Blair forges links with Clarke and Heseltine

Tony Blair's aides have established links with senior Tories Kenneth Clarke, Michael Heseltine and Lord Hurd to form a cross-party "Patriotic Alliance" to campaign for a single currency, it emerged last night.

The move is just the latest illustration of the Prime Minister's plan to break down political boundaries and to form closer relationships with like-minded politicians in both the Conservative and Liberal Democrat parties.

Already the Liberal Democrats have a seat on a Cabinet committee on constitutional reform, and although the Conservative Euro-positives have no intention of quitting their party they too may be keen to move closer to the Government.

Conservative and Labour politicians and businessmen have met on several occasions for dinner or drinks.

"Under the auspices of third parties there have been a number of meetings and contacts and they are starting to thicken up now," one source said.

"Good channels of communication have been opened up across the political divide, for everyone to let each other know broadly what they are doing."

The contacts, which have taken place between intermediaries so far, are aimed at setting up a co-ordinating group through which both Conservative and Labour enthusiasts can co-operate in a referendum.

Last month Mr Blair made a public appeal for such an alliance in a speech, which was greeted with caution by senior Conservative dissidents including Mr Clarke and Mr Heseltine.

Now aides to Mr Clarke, Mr Heseltine and Lord Hurd are believed to have met Government representatives to discuss the plans. The existing campaign group the European Movement has been suggested as a possible body to oversee the new links.

A cabinet-type committee had been suggested, but the Conservatives would have had political difficulties in joining such a group because it would have caused a row within their own party.

The revelation came as Euro-sceptic Conservatives seemed to be distancing themselves from reports that they, too, were setting up a cross-party campaign with the support of businessmen.

Former Prime Ministers Baroness Thatcher and John Major, Tory former leader of the Lords Lord Cranborne, former SDP leader Lord Owen, Labour former Minister Lord Shore and millionaire industrialist Lord Hanson were all named as likely participants.

But yesterday a spokesman for Lady Thatcher's office said she was not aware of any plan ready for take-off.

"If they are going to launch a group, I don't see her playing an active, organisational role or anything like that but, obviously, it is a subject she feels very strongly about," he said.

Asked if Lady Thatcher might play a figure-head role, the spokesman said: "At the moment I don't know. We would have to wait." Lord Shore was not willing to comment today, while Lord Cranborne was out of the country and a source close to John Major said he was not aware of such a plan.

Lord Owen said he would take an active role opposing a single currency, but gave no hint of joining any such campaign.

John Redwood, the Euro-Sceptic former Conservative Cabinet minister, said that instead of campaigning the Prime Minister should make his intentions clear on the single currency.

"Mr Blair leaves the country plunged in uncertainty. He won't tell us what his intentions are for the next election manifesto on this crucial subject" he said.

There were also reports last night that Norman Lamont, the former Chancellor, was expecting to enter the House of Lords this year as well as standing for a seat in the European Parliament.

Mr Lamont has also just taken on the chairmanship of Conservatives Against a Federal Europe.