So how will Mr Hague deal with his new rival?

'Portillo will be an undoubted star in a shadow cabinet short on brilliance and weight'
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The Independent Culture
THERE IS one slightly odd aspect to the way Michael Portillo's defeat in the early hours of 2 May 1997 took on mythic status, literally overnight. It was certainly the only individual result that did. Among the liberal left it was an allegorical fall, a triumph for the vanquishing party that eclipsed every other. And yet what those who savour the memory so frequently overlook was what happened immediately after the count.

Portillo turned out to be a good loser, - at least in public. The myth would have been all the richer had he turned, enraged and snarling, on his opponents. Instead he made a speech of congratulation to his successor, Stephen Twigg, which by the normal standards of these events was outstandingly graceful, humble even.

Perhaps Portillo was simply being far-sighted, and began his self-rehabilitation at the very moment of greatest adversity. But that's not the point. For it shows that Portillo is a subtler and perhaps even more ambitious politician than the knee-jerk reaction of Labour to his selection as the candidate in Kensington and Chelsea suggests. It may well, in the long run, be true that Portillo's return is of a piece with the famous "lurch to the right" in the party. But that isn't, mainly, what got him selected at Kensington and Chelsea. If it were, why should his predecessor, the leftish Sir Nicholas Scott, pay such unexpectedly lavish compliments to his star qualities? And why did several members present at the selection meeting think Portillo made "the least right-wing" speech of the four short-listed candidates?

We'll come to the implications of this in a moment. First, there is the little question of what William Hague does with him. In the short term, Portillo's return no longer need be a problem. First, he will be an undoubted star - not to mention a thinker - in a Shadow Cabinet short on brilliance and weight. Secondly, Hague has consolidated his own position, at least until the election. Lord Tebbit, having delivered a menacing critique of Mr Portillo's confession to a homosexual past, has pronounced, on behalf of the hard right, that Mr Hague is one of us. Mr Hague pre-empted Portillo's return by successfully courting the nationalistic right in his conference speech. With creditable local and Euro-election performances behind him, he is continuing to be rather more formidable in the Commons than anyone imagined two years ago.

True, no possibility is free of difficulties. The talk of a probationary period on the back benches is laughable. But it may well be in the interests of Portillo to seek a short period acclimatising to an unfamiliar House of Commons and getting used to the gibes of the massed ranks of Labour MPs from the back benches rather than from the dispatch box. But then what?

To make him shadow Foreign Secretary or shadow Chancellor would be to invite a minute and chronic examination of every nuance that could suggest a difference between the two men on Europe. To make him shadow Leader of the House instead of Sir George Young would be crazily to remove the Shadow Cabinet's most notable guardian of old-fashioned mainstream Tory values. The neat replacement of one Portillista, Ian Duncan Smith, in the middle-rank Defence post with Portillo himself, would at the very least now require Portillo to renounce his previous opposition to gays in the military - and would probably waste his talents.

And even to make him party chairman might not be as effective a means of neutralising him as a post-election leadership contender as it was when Margaret Thatcher made Ken Baker chairman in 1989. Hague does not overshadow Portillo in the same way that Margaret Thatcher overshadowed Baker. But it is hard to imagine any better means of tying him to the leader's own fortunes - by making it Portillo's responsibility to deliver the very advances that would help to protect Hague's leadership once the election is over. For it's not until then that Portillo's leadership prospects really become an issue.

Let's leave aside the dispiriting frequency with which MPs outside the still impressively robust ranks of the Portillistas return to the subject of his youthful gay past in talking down his prospects. Let's also ignore, for the purposes of argument, the possibility that Hague fails to make the minimum electoral recovery to keep his job. What happens if - say - some time after that, Tony Blair holds a referendum on EMU and wins it, precipitating the demise of Hague, a twice-defeated leader, but also rendering the most vicious and long-standing argument within the Tory party suddenly obsolete?

And here there are at least two theories swirling within the higher ranks of the Tory Party. One is the counter-intuitive view that Portillo - on a variant of the old Nixon-recognises-Red-China principle - is just the man to lead the Tory Party back into the centrist mainstream? That such a move will have to be led by a man of the right, and that in any case Mr Portillo's careful softening towards "cuddly Conservatism", notably in his famous 1997 fringe speech at the Tory conference, has been an excellent preparation for doing just that.

The contrary view is that Portillo, through a mixture of conviction and image, indelibly planted in the psyche of the electorate, is incapable of performing that kind of handbrake turn. Critics on the Tory left argue that he is most passionate when he talks tough and right-wing on Europe and social policy, and simply disingenuous when he appears to renounce Thatcherism.

Portillo remains deeply Thatcherite, they go on, a fact shown by his loyalty to his leader when she fell, even though the British people will never again vote for Mrs Thatcher or her heirs. If re-elected next time, Malcolm Rifkind would be a more plausible centre-right candidate.

A parallel criticism from Portillo's opponents on the right is that every time he strays from the true faith, he shows that he is just another politician, rather than one driven by real conviction. And both groups of critics purport to marvel at the ease with which in 1997 he appeared to disavow policies with which he, more than most of colleagues, was firmly associated in government.

Electability, under the new system introduced by Hague, is by no means the only criterion for choosing a Tory leader. An alternative to Portillo could be the surely unelectable Ann Widdecombe. But if Portillo - whom the polls currently show as no more popular in the country than Hague, and less so than Ken Clarke - were to become popular in the country, it might make him invincible in a Tory contest.

And on this, the question of whether Portillo can reinvent himself in the minds of the British people, I confess to being an agnostic-to-sceptic. The negative view, namely that he cannot lead the Tory party back to recovery of the centre ground, still looks much the more persuasive, not least because of the familiar riddle on the right: how to be right-wing enough to win the party and centrist enough to win the country?

Labour, more worried than it admits, will do its utmost to paint him into the Thatcherite corner. But whether Portillo has any answer to that riddle, now becomes one of the most interesting questions in British politics.