THE TORY LEADERSHIP 1: Will they both be dumped?

THEY clustered everywhere: in the lobbies, on the Terrace, in front of the cameras and even at the entrance to the car park. And in each place the campaigners gathered, confusion reigned. For the week in which the Prime Minister battled to save his job, the mood was perhaps summed up in the moment when Sir Patrick Mayhew, Secretary of State for Northern Ireland and ardent Major loyalist, visited the Prime Minister's campaign headquarters. As he marched into the Cowley Street offices to offer his support, it took a last-minute lunge by one of his aides to save the minister from barging into an adjacent Liberal Democrat office by mistake.

Few Tory MPs last week were any more capable of keeping their bearings as the tides of rumour swirled first one way then another. Complex questions beset them. Will the supporters of Michael Portillo oppose John Redwood for fear of boosting the rival right-winger? Will Michael Heseltine's backers support Mr Redwood to force a second ballot in which their candidate can come forward? Could tactical voting accidentally give Mr Redwood so much support that he will become unstoppable?

In a contest where the rules are complex and the electorate can pride itself on being the most duplicitous, if not sophisticated, in the world, the outcome remained as opaque as ever. At times, conversations were so coded and conspiratorial that communication broke down completely. On Wednesday one MP broke off a discussion with a journalist to ask a colleague urgently to secure him a place on "table number one" in the dining room. "Are you trying to tell me something?" came the response. "Yes," said the MP darkly, and then darted away leaving his colleague baffled. In fact it was neither a plot to install Mr Heseltine nor a secret conclave of Portillo supporters. The Prime Minister, it emerged, would be joining MPs on "table number one" and some thought it prudent to be there.

IT IS five years since Norman Tebbit cracked the best joke of the 1990 leadership campaign when he said the dream candidate was "my brain in Michael Heseltine's body". Last week he was back in the lobbies, as one bystander put it, "like a shark scenting blood". Since 1990 the centre of gravity of the Conservative Party has shifted dramatically in the direction he favours. The 1992 intake of new Conservative MPs was disproportionately Thatcherite, and events have combined to give the Eurosceptics disproportionate publicity and influence. The mood in Europe has changed, as the French and Danish referendums on Maastricht in 1992 showed. And a shining example of the electoral power of right-wing policies has come with the revival of the US Republicans under Newt Gingrich.

In this context, it was always likely that any challenge to Mr Major would come from the right, and the obvious man to make it was the former chancellor, Norman Lamont, who was sacked by Mr Major in 1993. So when Mr Major threw down the gauntlet 10 days ago, a media vigil began immediately outside Mr Lamont's home in Notting Hill, west London. The press's instinct was correct. Mr Lamont had for some time been expressing to friends his willingness to challenge the Prime Minister if no one else did, and he had planned speeches in the autumn intended to raise his profile ahead of a challenge in November. He was tempted when the contest was brought forward, but as it turned out, he was not the only one.

JOHN Redwood was never a member of the Major inner circle. Indeed, when the Prime Minister described three of his Cabinet colleagues as "bastards" there was little doubt that one was the Secretary of State for Wales. For some time, Mr Redwood had been nursing feelings of exclusion, and he was particularly annoyed by last year's decision to make European funding a vote of confidence, which resulted in eight Eurosceptic MPs being stripped of the whip. One Redwood backer said: "He had grounds to have resigned earlier ... I don't know when he decided. It is a possibility that had perhaps been growing in his mind for some long time."

There is no clearer example of the distance in the Major-Redwood relationship than the manner in which he heard of the Prime Minister's decision to call the leadership election. On Wednesday 21 June - the day before - Mr Redwood had gone to Downing Street to discuss ideas for fending off a challenge in the autumn and Mr Major had given no hint of the drastic course he planned. The Prime Minister never informed Mr Redwood, leaving that task to Michael Howard, who broke the news to him at the Commons the next day only an hour before it became public knowledge.

When Mr Redwood declined to produce anything but a limp statement of support for Mr Major on the Friday it was assumed that this was a sulk, rather than a threat. But there was more than one reason for the limpness.

For some time the three Cabinet "bastards" - Michael Portillo, Peter Lilley and Mr Redwood - have had a gentlemen's agreement about the single currency, under which they broadly stick to the government line. But every now and then Mr Portillo has overstepped the mark and in doing so has defined himself as the toughest of the three on Europe. Mr Portillo has emerged as the right's anointed favourite, and this has left Mr Redwood feeling outflanked. The idea of resigning from the Cabinet and challenging Mr Major now presented itself as a bold way of seizing the initiative on the right.

The first reaction of the Secretary of State for Wales on hearing the news of Mr Major's decision was to ring his wife Gail and tell her something big was happening. Part of that Friday was spent at Lord's with Mr Redwood's former parliamentary aide, David Evans. By one account, the former professional footballer told the Fellow of All Souls: "Here is what you've got to do, my son. You've gotta resign from the Cabinet and stand against Major. It's your one chance: Hezza will bottle out. If you stand you'll have a clear run."

Christopher Gill, MP for Ludlow and one of the nine MPs who lost or resigned the whip over Europe, "woke up that Satur- day morning thinking 'it's time I spoke to a few of my col-leagues' ". The people he spoke to became the core of the Redwood campaign team. Their plotting was done on the telephone, according to one insider, "courtesy of those phone numbers that very few people have". Cabinet colleagues in Mr Major's team, it seems, did not have these numbers, for they were unable to reach Mr Redwood. Norman Lamont, by contrast, was able to talk to him both on the Saturday and on the Sunday.

Mr Gill says that Saturday Mr Redwood's demeanour was "cool - by that I mean calm and collected". The plotters talkedthrough the weekend, and then met at the office of one of the MPs in Westminster. There were 10 present - all of those who subsequently emerged as Redwood standard bearers except Edward Leigh, plus Mr Redwood himself. The meeting was business- like and ended after half an hour with the decision to go ahead. Mr Gill said: "The feeling was that we were glad that somebody was going for it, and we were going to have a proper contest - not just a fudge."

Although, by Sunday evening, it was pretty clear to Mr Lamont that a Redwood challenge was on, he waited until Monday morning, and a face-to- face meeting in the Commons, before formally agreeing not to throw his own hat in the ring.

SO FAR so good, but on Monday morning the logistics of mounting a campaign at short notice began to get the better of the challenger and his team. Tony Marlow and Teresa Gorman were not at the critical Monday morning gathering, but managed to insert themselves into the overcrowded press briefing called to launch the Redwood challenge. Because of the media scrum, Mr Redwood sat in the wrong place, in front of the once whipless Tory MPs - dubbed by the Major campaign as the "Broadmoor Eight" - Mr Marlow with his loud striped blazer and Mrs Gorman in her flourescent green dress. This gift to the photographers, aides admit, was a mistake. One senior member of the 1922 executive said the campaign "was destroyed in the minds of a lot of people by the picture on the front page of the Times, with Marlow and Gorman standing behind him. That silly blazer! That green frock!"

Fashion problems apart, the first press conference went well, with Mr Redwood attempting to shed his Vulcan image with a couple of jokes. The press was good, although the Sun did subsequently print a set of cut-out- and-keep Spock ears.

Things deteriorated with Tuesday's detailed list of policy initiatives. Its populist mix - capital punishment, saving the royal yacht and keeping the regiments - owed more to Mr Evans, the campaign manager, than to Mr Redwood's Oxford past. A pledge to cut pounds 5bn off public spending provoked offers from the Major team to show Redwood letters pleading for more money for the Welsh Office. Endorsements from outside the right were few and far between. By Thursday, when the Redwood roadshow moved to Church House for its daily press conference, the same old faces kept on showing up. In the middle of the week Mr Redwood received aboost in the form of Robin Harris, a key member of Baroness Thatcher's staff, who put some backbone into the campaign. But, as one neutral Tory MP put it, the result was "surprisingly unimpressive in presentation, ideas and endorsements".

Nor were things too rosy back at campaign headquarters in Ashley Gardens. On Tuesday morning it had only one proper telephone line and, when Mr Redwood read out the number at the end of his press conference, it became public knowledge courtesy of Sky Television. For hours it was jammed by members of the public wanting pledges on obscure items of policy. Mr Harris and one or two others excepted, the team seemed low-grade; as one insider put it, they were "a lot of rejects from the Federation of Conservative Students circa 1985". By Wednesday there was still no working word processor and volunteers took Redwood speeches back to their offices to get them typed up. On Wednesday, too, a photocopier arrived but was too large to fit through the door. Finally, residents of Ashley Gardens rose up to complain about the disturbance, forcing a partial retreat to other premises in Buckingham Gate.

IT WAS fear of just such difficulties that prompted a blunder from Michael Portillo. Suspicions were raised when a British Telecom technician turned up at Mr Major's Cowley Street headquarters to be told that things were too busy to be disrupted. Fine, he said, he had another job just over the road.

On Wednesday four new lines were installed in 11 Lord North Street, just around the corner from Cowley Street. The night before, two MPs had been seen entering the house: John Whittingdale, a former political secretary to Mrs Thatcher, and Eric Forth, an education minister and member of the Thatcherite No Turning Back group. Both men are allies of Mr Portillo and are said to be potential campaign leaders. Two and two were swiftly put together and an embarrassed Mr Portillo found himself squirming on radio when asked whether 11 Lord North Street was likely to be his campaign base in a second round. He could neither confirm nor deny the rumours, he said.

Mr Portillo finds himself in a difficult predicament, his thunder as leader of the right having been stolen so spectacularly by Mr Redwood. The two men met on Monday and agreed a "non-aggression" pact. But there is anger on the right at Mr Portillo's wait-and-see attitude, "swanning around cocktail parties rather than getting stuck in", according to one right-winger. As a Redwood supporter put it: "A lot of people on the right are very disappointed with Michael. He has been devious. He has also had no balls."

That may explain a rash of mid-week newspaper stories quoting friends of Mr Portillo arguing that their man was preparing to stand in a second ballot. It is highly unlikely that these comments were unauthorised since Mr Portillo himself phoned at least one newspaper editor with a very similar message.

But, while he must guard his flank against Mr Redwood, Mr Portillo is showing a growing confidence that this could just be his year. Most MPs believe that, in a straight fight between Mr Portillo and Mr Heseltine, the later would win, but only narrowly. One figure on the centre-left conceded: "The precedent is Thatcher. The party likes rallying behind a strong leader. If Portillo put out two messages: tax cuts and no single currency within the next five years - straight down the line - a lot of people in the centre of the party would say, 'Oh go on, give it a try. At least it has clarity'."

A senior party figure added: "Portillo has mellowed. He rose very fast and that went to his head and he made several mistakes. But he has rowed a long way back in the last year."

The skeleton team is already drawing up tactics. In 1990 a number of Mr Heseltine's backers - such as Edward Leigh and Michael Brown - were from the right. A Portillo campaign against Mr Heseltine would challenge this support by concentrating on Europe, the issue on which Mr Heseltine is most vulnerable.

Yet the argument deployed by the Major camp against a Portillo challenge has some logic. As things stand, they say, if Mr Major stays and wins the election, Mr Portillo will be given a great office of state and inherit the leadership after three or four years. If the Tories lose, he will be the natural leader of the Opposition. But Mr Heseltine would spoil all that, so only now, by precipitating a Heseltine premiership, can Mr Portillo possibly deprive himself of the leadership of the party. Several prominent right-wingers, such as Michael Forsyth and James Cran, have stuck with Mr Major. Many believe Mr Portillo thinks the time is not right for a full-blown contest.

So Mr Portillo's backers have to decide: should their man bide his time, stick with Mr Major and risk becoming leader of a party heavily defeated at the next election? This might mean spending two terms out of office. Or should he go for broke now, even if he risks handing the crown to Mr Heseltine?

FOR THE President of the Board of Trade things are easier. He cannot afford to look disloyal, having been Mrs Thatcher's executioner in 1990. He simply has to wait to see if the prize is given to him by MPs scared of losing their seats. Even right-wingers concede that a Heseltine premiership would "avoid an innings defeat" for which the party is currently heading. He does not even need to think about assembling a campaign team since the bones of one survive from five years ago. Michael Mates, Keith Hampson and Peter Temple-Morris are keeping their heads down now, but nobody supposes that they have thrown away their lists of supportive MPs.

Mr Major's campaign team has done its best to court Heseltine supporters and dissuade them from abstaining this week in the hope of a second ballot. They cite 1975, when the left thought they could abstain and get Willie Whitelaw. Instead they got Mrs Thatcher.

But this is making little headway. "Heselteenies" believe things are going emphatically their way. One said last week: "We haven't met yet. We're not doing anything until the second ballot but it's looking very bad for poor old Major. I think he's had enough. He seems to be saying: if you don't want me then that's fine."

If Mr Heseltine wins in a second ballot, or a separate contest, they will, they concede, have to deal "fairly" with the Eurosceptic right; Euro-enthusiasm will have to be tempered. But this will only be done after a leadership election. And, as one left-winger put it, after last week Mr Portillo's position looks far from invulnerable given the right's split: "His chaps seem rather young and inexperienced, going round saying he will stand in the second round. It looks very bad. But it may not be Portillo we have to deal with - it could be the Vulcan."

At the Major team's base at 13 Cowley Street, things have been looking up somewhat. They now have 12 phone lines, a new fridge which dispenses ice-cream, cable TV and "alfresco" supper. Dress, said one Cabinet minister intriguingly, is "optional". The campaign has emerged from a bruising week. The Redwood candidacy shocked Westminster and Mr Major's absence at the Cannes summit handed the initiative to the challenger.

The media has been hostile. A senior member of the team said last week: "Rupert Murdoch has decided that he does not want Mr Major as prime minister and would prefer Michael Portillo." Mr Murdoch increased the paranoia by being spotted chatting to Mr Lamont at a party on Monday. So defensive is the Major team that it planned no media campaigning yesterday since it was convinced it would make no difference to the hostility of Conservative- supporting Sunday papers.

After his slow start, Mr Major has fought back. Once back in the country he lost no time in courting MPs. On Wednesday night he dined with one group and on Thursday he chatted with others on the Terrace; in between he is granting 10-minute audiences in his office. "He is listening," said one MP.

His team meets twice a day, at 8am in the panelled dining-room of Alastair Goodlad's home in Lord North Street, then in the evening at the Commons, usually in Michael Howard's room. Cabinet ministers come and go from the Cowley Street headquarters, although neither Mr Heseltine nor Mr Portillo has yet found the time.

Last Thursday brought a boost at Question Time when Mr Major performed above himself, ridiculing Mr Redwood and out-arguing Tony Blair. Then in the evening the Positive Europeans were wooed. By Friday loyalists were feeling better. One boasted: "The fight is o'er, the battle done." A veteran Tory backbencher, one of the signatories of John Major's nomination papers, added: "Redwood got off the ground, but not into the stratosphere." With this momentum behind them, the campaign team has redoubled its efforts, urging wavering MPs to back the likely winner, especially if they hope for preferment. As one right-winger put it: "All the toadies are turning to him. It's a job-seekers' charter."

ON Tuesday polling will close an hour earlier than in the 1990 Tory leadership election to allow the result to be carried in full on the early evening television news. The result will be announced in Room 14 in the Committee Corridor of the Commons by the returning officer, Sir Marcus Fox, chairman of the 1922 Committee. He will disclose the number of votes cast for each candidate, but not the number of abstentions - which could be critical to the Prime Minister's hopes. How will we know whether Mr Major has won enough votes?

The facts, as much as they are known, seem to be these: this is the Conservative Party's last chance to change the prime minister before the next general election. It is up to 40 points behind in the polls and yet Mr Major is still in with a chance. There are 329 Tory MPs and to win on the first ballot he needs a majority - 165 votes. He must also win by a margin of 15 per cent of the parliamentary party. If a second ballot is required it will be on 11 July, when a simple majority will suffice. However, were Mr Major to win narrowly and step down, a new contest would begin from round one.

By common consent, there is a point at which a first-round result that is technically a victory for Mr Major becomes politically insufficient for him to carry on. Where that point is we can not tell, for Mr Major could prove stubborn. If he polls fewer than 200 votes on Tuesday, he can claim to have a greater number of supporters than when he won in 1990. He would then try to secure his position by changing the rules so that no further contest would be permitted. His internal opponents would then have no sanction against him, save voting against the Government on a confidence motion and causing a kamikaze election. Yet few doubt that any more than 100 votes against or abstentions would sap his authority, potentially fatally.

The figures so far seem to point to around 170 pledges for the Prime Minister, although some raise that to over 230. The Redwood camp appears to have about 55 backers, with a possible 20 more. This picture may suit the challenger, for the weaker Mr Redwood's perceived position, the safer many MPs will feel about backing him.

Mr Major's figures, moreover, are subject to the lie-factor; it is, after all, a secret ballot. One MP, who is counted by the Prime Minister as a firm supporter, said: "There are a number of people, like me, who are broadly supportive of John Major's policies but are worried about the prospects for the next election, who will be tempted to abstain in the hope of getting Heseltine." Whatever they say now, many MPs will vote to save their seats. Hence the Redwood campaign jibe that Majorite MPs should "go back to your constituencies and prepare for unemployment".

The Prime Minister's fate effectively lies in the hands of those who would prefer either Mr Heseltine or Mr Portillo to take over. Neither minister has complete power over the votes of a large number of MPs but if, as one MP put it, sympathetic MPs decide to vote in a certain way "word gets about".

And, even if Mr Major avoids the second ballot, he can have little hope of emerging with more than two-thirds of his party behind him. A leading right-wing MP said Mr Major "might well stay" if he wins only a bare majority, "but he will be critically damaged. The Labour Party would make hay".

Many believe the Prime Minister's tactics have come badly unstuck. As one ex-Cabinet minister put it: "You do not unite your party by declaring war on one-third of it. He has brought Bosnia to Blighty."