Major defiant as turmoil grows

PM scorns talk of leadership battle

John Major last night called on Tory MPs to unite ''in the national interest'' and defiantly dismissed claims that he was under threat as Ministers fought to contain the shock-waves of the Government's crushing Commons defeat.

The Prime Minister compared putative leadership challenges to ''Bunter's postal order - widely talked about but it never actually arrives.''

As Kenneth Clarke, the Chancellor, put the finishing touches to today's new fiscal package to make up the pounds 1bn shortfall left by the humiliating loss of the second stage increase in VAT on domestic fuel to 17.5 per cent, Mr Major told a meeting of business people in London that Tuesday night's Commons decision had been a ''mistaken vote''. Cabinet ministers - some of whom met last night to hear Mr Clarke's recommendations - expected the package to be a mix of indirect tax increases and cuts in capital spending.

Meanwhile Mr Clarke sanctioned a 1/2 per cent interest rate rise to calm the markets after to Tuesday night's defeat.

Mr Major told his City audience he knew of ''no tax that has been misrepresented in such lurid and emotional terms as the tax upon which we lost the vote last evening''.

In an interview with Channel 4 News last night Mr Major went farther than before in leaving the door open for a referendum on British membership of a European single currency - the demand of a growing chorus on the right of the party. Mr Major said it was far too early say if the 1996 conference on the EU's future would merit a referendum, but he acknowledged that the question - ''even further away'' - of a single currency was a ''very significant decision.'' He added: ''I haven't ruled out a referendum.''

But amid signs of Cabinet divisions over whether the rebel MPs who have lost the whip for revolting against the European Finance Bill should be reinstated, the Prime Minister was tough in warning that their return to the fold depended on their attitude to the ''votes that lie ahead''.

The Government accelerated the progress of the European Bill by offering Eurosceptics a modest concession, agreeing to strengthen the powers of the Public Accounts Committee to scrutinise EU spending in the UK. In an unexpected bonus for the Government, the Bill reached its Third Reading - earlier confirmed as a confidence issue - in the early hours of today, completing its Commons stages 24 hours ahead of schedule. With Labour expected to abstain, the Government was set to win the vote overwhelmingly.

Amid renewed rumblings about the leadership, some Tory MPs compared Tuesday's defeat to 1976, when Denis Healey, the Labour Chancellor, suffered five defeats on the Finance Bill. ''Major is a great survivor; he'll struggle on, but we may lose the election,'' said one minister.

Tory MPs were hoping the vote, halting the VAT rise, would bring relief in their constituencies. But the threat of renewed revolt was raised by Nicholas Winterton, the maverick Tory MP for Macclesfield, this time over the Chancellor's cut in protection for the mortgages of the unemployed. Mr Winterton said the party appeared to be in the grip of a ''death wish''. One senior member of the Tory backbench 1922 Committee said: ''We are heading for the rocks. We have got to change tack, and very fast.''

(Photograph omitted)

PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
music

News
Russell Brand at an anti-austerity march in June
peopleActor and comedian says 'there's no point doing it if you're not'
Arts and Entertainment
Banksy's 'The Girl with the Pierced Eardrum' in Bristol
art'Girl with the Pierced Eardrum' followed hoax reports artist had been arrested and unveiled
Voices
Oscar Pistorius is led out of court in Pretoria. Pistorius received a five-year prison sentence for culpable homicide by judge Thokozile Masipais for the killing of his girlfriend Reeva Steenkamp
voicesThokozile Masipa simply had no choice but to jail the athlete
Arts and Entertainment
Sister Cristina Scuccia sings 'Like a Virgin' in Venice
music

Like Madonna, Sister Cristina Scuccia's video is also set in Venice

News
i100
Arts and Entertainment
James Blunt's debut album Back to Bedlam shot him to fame in 2004
music

Singer says the track was 'force-fed down people's throats'

Life and Style
The Tinder app has around 10 million users worldwide

techThe original free dating app will remain the same, developers say

News
news

Endangered species spotted in a creek in the Qinling mountains

News
peopleJust weeks after he created dress for Alamuddin-Clooney wedding
Life and Style
A street vendor in Mexico City sells Dorilocos, which are topped with carrot, jimaca, cucumber, peanuts, pork rinds, spices and hot sauce
food + drink

Trend which requires crisps, a fork and a strong stomach is sweeping Mexico's streets

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

IT Security Advisor – Permanent – Surrey - £60k-£70k

£60000 - £70000 Per Annum plus excellent benefits: Clearwater People Solutions...

MI Analyst – Permanent – West Sussex – £25k-£35k

£25000 - £35000 Per Annum plus excellent benefits: Clearwater People Solutions...

English Teacher

£100 - £160 per day + Mileage and Expenses: Randstad Education Leeds: Temporar...

KS1 Supply Teacher

£80 - £110 per day: Randstad Education Bristol: We are currently recruiting fo...

Day In a Page

Two super-sized ships have cruised into British waters, but how big can these behemoths get?

Super-sized ships: How big can they get?

Two of the largest vessels in the world cruised into UK waters last week
British doctors on brink of 'cure' for paralysis with spinal cord treatment

British doctors on brink of cure for paralysis

Sufferers can now be offered the possibility of cure thanks to a revolutionary implant of regenerative cells
Let's talk about loss

We need to talk about loss

Secrecy and silence surround stillbirth
Will there be an all-female mission to Mars?

Will there be an all-female mission to Mars?

Women may be better suited to space travel than men are
Oscar Pistorius sentencing: The athlete's wealth and notoriety have provoked a long overdue debate on South African prisons

'They poured water on, then electrified me...'

If Oscar Pistorius is sent to jail, his experience will not be that of other inmates
James Wharton: The former Guard now fighting discrimination against gay soldiers

The former Guard now fighting discrimination against gay soldiers

Life after the Army has brought new battles for the LGBT activist James Wharton
Ebola in the US: Panic over the virus threatens to infect President Obama's midterms

Panic over Ebola threatens to infect the midterms

Just one person has died, yet November's elections may be affected by what Republicans call 'Obama's Katrina', says Rupert Cornwell
Premier League coaches join the RSC to swap the tricks of their trades

Darling, you were fabulous! But offside...

Premier League coaches are joining the RSC to learn acting skills, and in turn they will teach its actors to play football. Nick Clark finds out why
How to dress with authority: Kirsty Wark and Camila Batmanghelidjh discuss the changing role of fashion in women's workwear

How to dress with authority

Kirsty Wark and Camila Batmanghelidjh discuss the changing role of fashion in women's workwear
New book on Joy Division's Ian Curtis sheds new light on the life of the late singer

New book on Ian Curtis sheds fresh light on the life of the late singer

'Joy Division were making art... Ian was for real' says author Jon Savage
Sean Harris: A rare interview with British acting's secret weapon

Sean Harris: A rare interview with British acting's secret weapon

The Bafta-winner talks Hollywood, being branded a psycho, and how Barbra Streisand is his true inspiration
Tim Minchin, interview: The musician, comedian and world's favourite ginger is on scorching form

Tim Minchin interview

For a no-holds-barred comedian who is scathing about woolly thinking and oppressive religiosity, he is surprisingly gentle in person
Boris Johnson's boozing won't win the puritan vote

Boris's boozing won't win the puritan vote

Many of us Brits still disapprove of conspicuous consumption – it's the way we were raised, says DJ Taylor
Ash frontman Tim Wheeler reveals how he came to terms with his father's dementia

Tim Wheeler: Alzheimer's, memories and my dad

Wheeler's dad suffered from Alzheimer's for three years. When he died, there was only one way the Ash frontman knew how to respond: with a heartfelt solo album