Tories claim 'Whitehall farce' is all media's fault: Cabinet defence of 'back to basics' adds to confusion as Major prepares for Scott inquiry

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CABINET MINISTERS, reeling under fresh blows to the Tories' battered authority, yesterday accused critics in the media of turning John Major's government and the 'back to basics' campaign into a Whitehall farce.

The Prime Minister, angered by press allegations that he threatened to crucify the Tory right-wing for undermining his campaign, was preparing to face a further challenge today when he is questioned by the Scott inquiry on the arms-to-Iraq affair.

William Waldegrave, Chancellor of the Duchy of Lancaster, said yesterday he would resign if the inquiry found he had acted improperly, the third Cabinet minister in four days to say so.

John Smith said Mr Major would have to explain why changes in the export rules to Iraq were concealed from Parliament. Rejecting the government counterattack, the Labour leader, interviewed on BBC 1's Breakfast with Frost, said: 'Why don't they understand that cynicism arises from the Government, not some mysterious elite? When we see a ruthless, arrogant, hypocritical and deceitful government in operation, that is where the cynicism arises.'

Sir Marcus Fox, chairman of the Tory backbench 1922 Committee, who privately urged Mr Major last week to get a grip on his government, led the counterattack by accusing the press of attempting to provoke a general election.

That will be seen as an empty charge following confirmation at the weekend that Mr Major told journalists at a private dinner at Downing Street that he did not intend to go to the country until October 1996 at the earliest, and more likely the following April.

Reinforcing the attack on the press, David Hunt, Secretary of State for Employment, said: 'Some elements of the media have tried to reduce the whole thing to the level of a Whitehall farce, but it's not about flapping nightshirts. We've been hearing all sorts of nonsense. Let's get away from that.'

However, there was renewed Cabinet confusion over 'back to basics'. Mr Hunt denied it was a moral crusade, but Mr Waldegrave, speaking on ITV's Walden programme, broke from that line by saying the Government had 'got into this territory' because 'there was a need for greater moral clarity'.

Tory morality was further questioned by allegations that gerrymandering in Westminster City Council extended to neighbouring Wandsworth, another showpiece Conservative authority, featured in Tory political broadcasts. Peter Hain, Labour MP for Neath, will call in the Commons today for an investigation by the District Auditor.

Labour sources studying the District Auditor's report on Westminster said they found evidence that the Government was aware of the policy of selling homes to likely Tory voters. Those invited to strategy meetings included Bryan Griffiths, former head of the Downing Street policy unit.

Paddy Ashdown, the Liberal Democrat leader, said on BBC radio: 'What has happened over the last week has done terrible damage to the Conservative Party but we may have ignored that it has done terrible damage to the political system and the political class itself.

'We have a government that is failing and a prime minister who cannot lead. We have a Conservative Party that has been in power for 14 years . . . and has run out of energy . . . but opposition parties have failed properly to assemble an alternative which Britain can feel confident with.'

The Prime Minister's supporters urged him to stick with the 'back to basics' campaign. 'He has to get on with the job. The whole thing will calm down. It is froth that will blow away,' said one minister.

Mr Major's right-wing critics believe he is unlikely to last until the next election. The Thatcherite 92 Group may postpone a strategy meeting planned for next month to avoid destabilising Mr Major, said one leading right-winger. 'I feel desperately sorry for Major. I voted for him and in politics one needs the element of luck - Margaret Thatcher made her own - but I don't think he will last.'