Goldsmith's claim of 400 candidates alarms Tories

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Political Correspondent

Conservative election jitters increased yesterday as Sir James Goldsmith claimed to have chosen an army of 400 candidates ready to stand on a single- issue demand for a referendum on European Union membership.

The billionaire former entrepreneur has said he will pour pounds 20m into his Referendum Party, which yesterday hired former Tory party press officer Michael Gunton as its chief spokesman.

Senior Tories are alarmed that Sir James's party could seriously damage their prospects at the next election by taking votes from Conservative candidates in marginal seats. Mr Gunton - who resigned from the Tory party in protest at its European policy - said yesterday that the Labour Party "should also be worried", but election analysts agree that the Referendum Party poses a greater threat to the Tories.

Sir James has written to all main party candidates for the next election, including MPs, asking them if they support a referendum on the Maastricht treaty - a referendum on a single European currency is not enough. His party promises to put up a candidate in all constituencies where no major- party candidate who is "likely to win" answers satisfactorily.

Mr Gunton said there had been a "substantial number of replies", but the only public supporters of such a referendum so far are Teresa Gorman, the Tory MP for Billericay, and Gerald Howarth, the former MP and Tory candidate for Aldershot. Mr Howarth was a director of Taskforce, a public relations company that worked for Sir James.

Mr Gunton said yesterday that the 400 candidates, "from all walks of life", had attended seminars and had been selected through interviews. The only candidates declared so far are Sir Alan Walters - Lady Thatcher's economic adviser when she was prime minister - who intends to challenge Kenneth Clarke, the Chancellor of the Exchequer, in his Rushcliffe constituency in Nottinghamshire, and Sir James himself, who has not chosen a seat to fight yet. Sir James is already a Euro-MP, elected in France, and heads the 13-strong L'Autre Europe party, pledged to reverse the Maastricht treaty.

Mr Gunton denied a report in yesterday's Financial Times that John Major had approached Sir James through an unnamed intermediary to see if the electoral threat could be averted. He said: "I am very sure that such an intermediary does not exist. Sir James has not been in contact with Mr Major since they met at Margaret Thatcher's 70th birthday party last October."

A spokesman for the Conservative Party said: "We are not aware of any discussions. Minority parties never have a significant effect on the outcome of general elections."

But Colin Rallings, a politics academic at the University of Plymouth, calculates that if Sir James's party wins 1.5 per cent of the vote, taking two-thirds of votes from the Tories, it would cost Mr Major 11 or 12 seats.

In a rare television interview in December Sir James was asked if he really would spend pounds 20m. He said: "The money is irrelevant. It's irrelevant to me. I will put whatever it takes to give the chance for people to understand what the issue is, to have a full debate at the time of the general election."

And he promised: "I have never bluffed in my life. I didn't bluff in France. We got 13 per cent of the vote, and why should I bluff on this occasion? We will go through to the end, come what may. This is the single most important battle one can possibly have."