Hurd leads backlash in battle over Chancellor

Douglas Hurd will issue a rallying call to One Nation Tories tomorrow to speak up for their brand of Conservatism against domination by Euro-sceptics in spite of the right-wing backlash over Kenneth Clarke's stand on the single European currency.

The former Foreign Secretary will use a conference of the Mainstream group of Tory MPs, led by David Hunt, a former Cabinet colleague, as a pre-emptive strike against the right wing before the Tory Party conference.

Coming after the former Foreign Secretary signed the grandees' letter to The Independent, it will confirm the determination of middle-ground Tories to fight the right wing. A string of ministers will share the Mainstream platform, including Nicholas Soames, defence minister, Robin Squire, Ian Taylor, and ex-minister Tim Yeo.

The readiness of the former wets to hit back at the Tory right - with Danny Finkelstein, head of the Conservative Party research department present - will highlight the threat of civil war breaking out in the party. But it is a mark of their renewed anxiety to fight back against the right wing dominating the agenda for the general election.

John Redwood will lead the calls at the conference for a more Euro-sceptic approach to reunite the party for the general election. He accused the Chancellor of letting down Britain at Dublin at the weekend by failing to oppose efforts by European partners to accelerate the move towards a new exchange rate mechanism.

Mr Redwood told The Independent: "We expected the Chancellor at Dublin to put the Government's view in order to influence the debate. It is a great pity that the Chancellor didn't warn of the dangers and the grave damage the ERM has done and could do in future.

"He should have reminded them it is British Government policy not to re-enter the ERM, and rightly so."

Mr Hurd will warn the party that it will risk losing the general election if it surrenders the centre ground to Labour under Tony Blair. He will tell the all-day conference tomorrow that the party has encountered turbulence, but One Nation Tories should be prepared to speak out to defend their brand of Conservativism.

However, Mr Redwood, the champion of the right wing, will point out in a fringe speech to the Conservative 2000 group at the annual party conference that the conference motions show there is massive support for Euro-sceptic policies.

He will tell the Tory fringe that a Euro-sceptic approach is adopted in 198 motions for the Europe debate, a further 38 motions for the agriculture debate, four in the defence debate, and seven in the debate on trade and industry. He will argue that the party is united behind a Euro-sceptic approach.

Mr Redwood's supporters said last night that Mr Major would like to adopt a Euro-sceptic tone for the general election. "He cannot because he is terrified of Kenneth Clarke," said one right-wing source.

Bill Cash, a leading backbench Euro-sceptic called on Mr Clarke to consider his position.

But Mr Clarke's supporters said last night he was not isolated. He had the support of Michael Heseltine, the deputy Prime Minister, in the Cabinet, and had made it clear to close friends that he believed he was entitled to defy the Euro-sceptics because he had charge of the economy.