MONCTON, N.B. - Stephen Harper tried turning a caucus scrap over his Tory predecessor from a liability to a political advantage for his Conservatives on Wednesday.

The prime minister argued that his rocky relationship with Brian Mulroney proves he values ethical government -- and the Liberals don't.

The comments came after a raucous Conservative caucus meeting in which several of Harper's own MPs decried what they felt was mean-spirited treatment of a former leader.

"Mr. Ignatieff and the Liberal party, when the matter first broke, were practically demanding that I throw Mr. Mulroney in prison without a trial," Harper said in response to a reporter's question.

"Now they're out there pretending that somehow they're his best friends and they don't agree with any of this."

Harper contrasted his approach to Mulroney with a principled defence of his decision to call an inquiry into the business relationship between the former prime minister and arms dealer Karlheinz Schreiber.

"Canadians will remember this government had a difficult issue and I think this government handled it in a responsible way," he said.

Harper noted the inquiry's terms of reference were drawn up by an independent third party.

"This is not an easy matter," he said. "But I think Canadians understand that the government has taken a matter that is very difficult for ourselves, for our party, and handled it responsibly."

By attacking Ignatieff on the issue, Harper portrayed himself as the leader who will investigate allegations of corruption.

Ignatieff reportedly telephoned Mulroney on his birthday last month and has criticized Harper this week for showing Mulroney disrespect.

But Harper defended the way he has handled the situation while questioning Ignatieff's ethics.

"I think what Canadians will see when it comes to a very difficult issue of government conduct and government ethics, this government has behaved responsibly and the other party, the other leader, has absolutely no moral compass."

A spokeswoman for Ignatieff accused Harper of trying to shift the focus away from his problems in caucus.

"It is disappointing that the prime minister, who is clearly having difficulties with his caucus, would lash out at the Opposition leader for a courtesy birthday call to former prime minister Mulroney," Jill Fairbrother said in an email. "The Liberal party fully supports the inquiry. Our position on this has not changed."

A former chief of staff to Mulroney says Harper's strategy could work if the inquiry by Manitoba Justice Jeffrey Oliphant unearths embarrassing accusations against the Liberals from the purchase by Air Canada of Airbus planes from the 1980s.

"As the Oliphant Commission continues its work, it may provide an interesting opening that Mr. Harper may just be able to exploit in an election campaign," Norman Spector wrote this week in the Globe and Mail.

Harper did not directly answer a reporter's question on whether there is a split in his caucus, nor could he clear up confusion over whether Mulroney is still a member of the party.