The Labour Party in Blackpool: Labour leader wants discredited Lamont replaced

LABOUR'S conference yesterday unanimously demanded the replacement of Norman Lamont as John Smith said that the conduct of the Government and Britain's presidency of the community were 'descending into humiliation and chaos'.

The Labour leader demanded a full explanation of the Government's defence of sterling in the light of the Bundesbank's statements. Mr Lamont should go, Mr Smith said, but the issue now went beyond that 'to the heart of this Government', the Prime Minister's public backing for his Chancellor's actions.

Interviewed on BBC Radio, Mr Smith said the Chancellor was 'drained of any reserves of credibility he had' but the Prime Minister's real problem was that he 'could not have more firmly and clearly allied himself to his Chancellor'. He had told the Commons last week that he took full responsibility for his Chancellor's actions and policies, Mr Smith said, 'so this goes right to the heart of this government'.

Mr Major should 'detail point by point where the Bundesbank is wrong, if it is wrong'. If the Government had a defence it should produce it, because the questions 'go right to the heart of the credibility as well as the competence of his administration'. Mr Major's administration appeared to be 'completely losing sight of the national interest,' and instead of 'shilly-shallying' Mr Major should 'show some leadership at last'. He added: 'I believe we are seeing not only the conduct of British government, but the presidency of the Community descending into humiliation and chaos'.

Mr Smith's comments came before the conference unanimously passed a call for the 'discredited' Chancellor to be replaced and Mr Major to produce 'a full personal statement on the handling of this financial crisis'.

Gordon Brown, the shadow Chancellor, also demanded that Mr Lamont should go. The call came, he said, two weeks after the devaluation of sterling and Britain's withdrawal from the ERM, and after two weeks 'at the end of which there is no economic policy in place for now or the future, and no explanation for the failure of the policy of the past, and, shamefully, no apology either'.

The Prime Minister must immediately 'make a full and detailed statement in answer to the serious allegations that have been made about the conduct of economic policy, and about the events leading to the devaluation of the pound'.

When almost three million were unemployed, and when the week had seen some of the worst redundancies of the recession, with the fear of unemployment paralysing the economy, 'the action of any responsible Prime Minister would now be clear.

'He must at last face up to his duty, he must put the interest of Britain before the selfish interest of the Conservative Party. And for the good of our country, his Chancellor must go.'