Finance Minister Paul Martin threatened to quit on Friday after Prime Minister Jean Chretien threw down the gauntlet and warned he would fire ministers who don't end their unofficial leadership campaigns.

But, at a press gallery dinner in Ottawa Saturday evening, the prime minister showed few signs he's worried. Chretien made only passing reference to the Liberals' troubles.

"I can't think of any other place I would rather be ... That is why I turned down an invitation to a meeting in Kabul, Afghanistan tonight and late last night I asked Paul Martin to go in my place," joked Chretien.

Martin, considered the front-runner to succeed Chretien, told reporters at a party fundraiser Friday that he was going to "reflect" on his options.

"I have to reflect given the events of the last few days on my capacity now as a member of the cabinet, as a member of the government, to have an impact on matters I feel very strongly about," Martin said.

"The question is, will my continuation in the cabinet . . . permit me to exercise the kind of responsibility and influence that I believe a minister of finance must."

Those surprise statements kicked off a wave speculation about not if but when Martin would quit.

John McKay, chairman of the Ontario Liberal caucus, predicted Martin will resign and challenge Chretien for the party's leadership at the Liberal convention next February.

CTV's Ottawa bureau chief Craig Oliver said Martin's surprise announcement will surely mark the end of his tenure in cabinet.

"I think Mr. Martin has written himself a one-way ticket right out of the Chretien government," said Oliver. "I think it is obvious that he'll be gone by Monday or Tuesday, if not sooner."

On Saturday, Tory leader Joe Clark said it was time for Martin to "grow up" and end his squable with the prime minister because it's affecting the country.

"The world doesn't care about the internal conflicts in the Liberal party. But the world does car very much about the financial stability of this country," Clark told reporters in Ottawa.

Clark said he doesn't care whether Chretien or Martin makes the first move but someone has to put an end to "the chaos."

On Friday, a feisty Chretien threatened to dump any leadership hopeful from cabinet who continued to organize a campaign. Chretien said the public competition for his job is distracting MPs from their duties.

"They will have plenty of time to organize because they will not be ministers anymore," Chretien threatened.

Asked if he fears being pushed out as leader by a revolt within his caucus, Chretien replied: "They can try. For 39 years I never ran away from a fight, so I'm not about to start at my age."

Chretien also demanded the support and loyalty of all his cabinet, staring at Martin as he did so, a senior Liberal source told CTV News.

Earlier, Chretien confirmed he will remain as party leader until the end of his current term and then decide if he has the "energy" to seek a fourth mandate.

"When my term comes to an end I will decide whether to go home or stay on," said Chretien.

However, a poll released late Friday indicated 68 per cent of Canadians believe Chretien should step aside before the next federal election.

The Ipsos-Reid poll, conducted for CTV and The Globe and Mail, also suggested 58 per cent of Liberal supporters want Chretien to let someone else lead the party into the next election.

The poll of 2,000 adults was conducted between May 22 and 30 is considered accurate with plus or minus 2.2 percentage points 19 times out of 20.

Much of the animosity within Liberal ranks has been sparked by reports of unethical conduct by several Liberal ministers. At least one such incident is the focus of a RCMP criminal probe into multi-million-dollar advertising contracts awarded to a financial supporter of the Liberal party.

Chretien's anger has been further fueled by a flurry of media leaks within his own cabinet, some of which are suspected of coming from leadership rivals.

On Friday in the House of Commons, Deputy Prime Minister John Manley took the brunt of opposition attacks over Chretien's comments about cabinet leaks and the possibility that millions of sponsorship dollars directed at Quebec may have gone missing.

The Canadian Alliance accused the government of threatening senior civil servants and politicians who expose government mismanagement.

The latest controversy to hit the Liberals arose Friday concerning a $2.3 million contract given to Compass Communications, a Halifax-based company. The money was used to provide signs and a pavilion at the 1999 Pan-Am Games in Winnipeg. The company's president is a former Liberal election strategist.

Compass spokesperson Dana Dorion said the contract was in no way connected to the company's Liberal ties.

"I'm not saying that there is no political interest here among employees," he said. "We are interested in politics . . . but there's no connection between the politics of the individuals of this company and the work we get."