The Conservative Party has no choice but to follow Michael Heseltine's advice

Among the shocked squeals of protest within the Westminster beltway at Lord Heseltine's stunning intervention in the debate on the Tory leadership, one in particular resounds, even among those who are uneasiest about the present incumbent. The Heseltine timing was bad, they say. The question won't be live again at least until the late spring. It will rebound by ensuring that even his opponents rally round the present leader. It won't help Ken Clarke, the chosen Heseltine champion. And so on.

This is surely to misunderstand the nature and urgency of the Heseltine message. For in reality the timing of his Independent interview could hardly have been better, if you look beyond the obsessive introspection of an Opposition apparatus marginalised to an extent unprecedented since Labour in 1981-3 and arguably for much longer than that. It's impossible to recall a period since 1997 when an Opposition leader who looked dangerous enough to form a government would have had a greater opportunity or fulfilled a more pressing need. And this isn't just because the latest revelations about the Cherie Blair entanglement with Peter Foster have suddenly given it just the substance it seemed to lack until the weekend, though that's certainly what they have done.

Let's, first of all, be as fair as we can to the right-wing faction which now dominates the Conservative Party. Iain Duncan Smith's dogged questioning of the Prime Minister on tuition fees has helped to heat up the row already simmering noisily within the Labour Party. Oliver Letwin has struck a tone at once civilised and mildly libertarian on many issues in home affairs.

Consider, however, a few of the handicaps under which the factional leadership continues to toil. Just as Labour in the mid-1980s, the Tory party remains in identity crisis over tax and spending. Its obsessive Europhobia has been concealed rather than eliminated by the decision to remain silent on the subject. It has largely failed to exploit the seething hostilities between Prime Minister and Chancellor, as Neil Kinnock was able to exploit the tensions between Margaret Thatcher and Nigel Lawson in 1988 and 1989.

But this isn't all. Not long after the 1997 election David Willetts, the party's social security spokesman, produced a short but richly lucid work of history which every Conservative should re-read this Christmas. It compared and contrasted the relative speed with which the party refitted itself for office after the 1945 Labour landslide with the blinkered period it spent out of office after its even heavier defeat by the Liberals in 1906, until Stanley Baldwin finally came along to reconnect the party 16 years later with mainstream Britain. This is more than a mere matter of tariff reform – irresistibly comparable to Europe now as the issue which hobbled the chance of real Tory unity. For, above all, Mr Willetts' message was that 1945 showed that to become electable once more, the party had ruthlessly to shed its recent past and adapt to new times.

Let's allow for a moment that the so-called modernisation project is a demonstration that Mr Duncan Smith at least half-understands that. If true, why did he allow himself to be persuaded to adopt a posture of empty authoritarianism towards some of the biggest beasts in the party, Michael Portillo and Mr Clarke among them, when they refused to vote against gay adoption? Why, as late as last weekend, did he seem to fudge Mr Letwin's endorsement of proposals for registration of gay partnerships? (It was after all easy for the sensible right; it means that such partnerships should enjoy legal status for those who can't marry but not for those who can.) And why, if Europe is no longer an obsession, is he still insisting, to take a symbolic but instructive example, on withdrawing British Tories from the centre right grouping in the European Parliament?

Each of these issues may seem trivial on its own, but they all illustrate how Kenneth Clarke would start reversing the Tory negatives. His attacks on Labour profligacy would carry a unique credibility because no one thinks he wants to abandon public services. He would also reflect a large section of public – and Tory – opinion by sounding a welcome note of caution on war on Iraq. He would bring a credibility and, yes, danger, to the job that IDS cannot hope to command.

The problem has been whether the party members who rejected him last year would have him now. To this Lord Heseltine proposed an elegant solution in his interview with Steve Richards yesterday. Which is for MPs to decide on Clarke as a leader of the parliamentary party.

Those who believe this is a violation of democracy as well as the means of getting around the rules are missing a rather important point which is that membership ballots would have worked a lot better in the glory days when parties counted their members in millions rather than thousands. MPs are at least more in touch with the voters than the elderly or sectarian members who run many of their local parties. A system of elector primaries might be ideal.

But the details matter less than Lord Heseltine's central message that Iain Duncan Smith stands no chance of winning the next election and that in Mr Clarke are vested their best hopes of recovery. A growing number of MPs, and perhaps party members, knows this. It may not be any fairer than it was for William Hague. But there is every sign that the British electorate has already made up its mind about it. Given that next year is heavy with the issue of Europe, from the Convention of the EU's constitution to a (highly) putative euro referendum, Mr Clarke is unlikely to want to make his third assault on the leadership without a clear sign that he would get it.

It isn't certain that the party membership, given that their chosen champion IDS has not delivered, would reject him. But it's a risk. Lord Heseltine has one solution. Another would be for all the potential candidates to lock themselves in a room and agree on Clarke. Yet another might be for the election to be fought normally within the parliamentary party but for whoever comes second to withdraw before the contest went to the country outside, a formula which would surely deliver Mr Clarke, just as the system would have done if it had been confined to MPs in 2001.

But either way, Lord Heseltine's call is timely. It's possible that after the local elections in May, even groups of party members may be echoing it. Maybe Downing Street will implode. But if not, and perhaps even if it does, it could be still more urgent for MPs. Opposition, as Labour found in the 1980s, is a little like long-term unemployment. In demand on television, with a voice, but little taxing responsibility, Opposition MPs can gradually lose their hunger for office. Sooner or later, however, complacency intersects with real fear, in this case fear of losing your seat to a Liberal Democrat. Against that potent threat, Clarke does indeed stand "head and shoulders" over his peers. Unless they see that, this is going to be 1906 rather than 1945.

d.macintyre@independent.co.uk