Sources close to the Prime Minister believe that the Conservatives have turned a corner, and that, now the party has regained its grip on old- fashioned party loyalty, they are in with a chance at the next election.
Delighted by Mr Clarke's performance, the party conference gave him an ovation of more than four minutes - prolonged by Mr Major joining him in a victory handshake for a fighting performance.
But the fragility of the truce was shown by an early-morning attack from the Chancellor on "schizophrenic" Conservative Central Office workers who were publicly "knocking" party members - including himself.
From the other side of the party divide, Julian Lewis, deputy director of the Conservative Research Department at Central Office , deplored the gagging of conference debate on the single currency.
He told the BBC's Conference Live 96: "It's quite understandable that they don't want to have a huge and divisive debate, but it's sad that both parties feel they have to avoid debate in this way."
Closing yesterday's economic debate, Mr Clarke told representatives that the single currency policy had been agreed: "At every stage, we have the right to say, 'No'." The Prime Minister and Foreign Secretary had repeated it on Wednesday; he was repeating it again yesterday.
"So let us spend the next six months - and the election - uniting behind that policy, attacking the Labour Party, talking about the economy, and winning the election." The ovation for Mr Clarke, favourite bogeyman of the Tory Right, was the more remarkable because he signally refused to deliver any hint of the big tax cuts they have been demanding for next month's Budget.
But the unity tune became a common Cabinet refrain through the day. The Defence Secretary, Michael Portillo, said that the party needed three extra policies - "unity, unity and unity". The Deputy Prime Minister, Michael Heseltine, said with feeling that those who fed the media with harmful headlines deserved the party's "utter contempt" - and could help send the party into the wilderness for 17 years.
He also became the first Cabinet member to confront the challenge of Sir James Goldsmith's Referendum Party, which is staging a one-day conference in Brighton next Saturday. Although some senior Cabinet colleagues believe that Sir James will get only 6 or 7 per cent of the vote, at most, they argue that those dissident Tory votes could otherwise have gone to Labour, and the damage will be limited.
But Mr Heseltine asked Sir James what he thought he would gain by putting up candidates "where it will hurt the Conservative most" - and letting Labour in.
The establishment of unity will allow the Prime Minister to go on to the policy and political offensive when he addresses the conference in his formal leader's speech this morning.
But there were continuing indications of underlying party tensions in Bournemouth yesterday. At a lunchtime fringe meeting, William Waldegrave, Chief Secretary to the Treasury, said the party had to be ambitious in its pursuit of spending cuts. Once the Treasury had hit its present target of reducing spending below 40 per cent of national income, GDP, he said, "in due course, we should look further at a lower target."
Conference reports, pages 6,7
Polly Toynbee, page 18
Inflation figures, page 21Reuse content