Hague's first task: bringing the left back on board

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Seven years after her fall, the Tory party still couldn't manage to step out of Margaret Thatcher's long shadow. Nobody yet knows how many MPs were influenced by her belated, and famously reluctant, 11th-hour backing for the new leader. But either way, the party has done her bidding: it defeated, much more decisively than most MPs, let alone the pundits, expected, a proven world class politician on a unity ticket. It elected instead an untried 36-year-old who comes into office, as only the fourth Tory leader in over 30 years, with youth, intelligence, energy and lots of problems.

Whatever the result, Labour would probably have said it was the one it preferred. But it is almost certain that the party was more frightened, if that is a word appropriate to a government which so dominates the political landscape, of Ken Clarke than it is of William Hague. Hague now has five difficult years to prove it wrong. And no one should take away from him the fact that a party more ridden by factions than at any time since Robert Peel delivered him, in the end, a handsome victory.

The first of those problems is that from being a wet and disorganised bunch of polite moaners since the mid-Eighties, the pro-European left wing of the Tory party has been moulded by this extraordinary contest into a cohesive and determined force which did not vote for him and has a strong leader of its own. Hague's offer of "a senior shadow Cabinet post" was last night gracefully but swiftly declined and predictably so, given Hague's insistence on a loyalty test requiring all shadow ministers to adhere to his own decision to rule out a single currency for a decade. It was unimaginable that Clarke, for the sake of a mere shadow cabinet post, would abandon the principle for which he was prepared to risk his job of Chancellor of the Exchequer. Hague's first task will be to try and lure some of those left-wingers like Stephen Dorrell, former Secretary of State for Health, and self-confessed sceptic on the single currency, into his collective leadership. It will be necessary but very difficult to eliminate the chronic threat of a split with the left.

For the daunting and overdue task of overhauling the rickety and obsolescent party machine, Hague may prove to be the right man in the right place. There is a lot to do. Local parties, having already broadly shown that they are wiser than many of their MPs, now need to be given, as swiftly in possible, a say in future leadership contests. That will help to stabilise the existing leadership. Local parties favour the incumbent. But it is also, as Labour has shown, a vital step towards rebuilding the party's moribund and dwindling membership. Quite rightly people are no longer prepared to join a political party, much less knock on doors, stuff envelopes, and arrange coffee mornings unless they have some power as well.

There needs to be an electoral college in which power is shared between party members and MPs - Lord Archer has even suggested 50 per cent apiece. Hague should stand again for the leadership, as soon as the new system is in place, to demonstrate his popular support within the party to the numerous MPs who will not have accepted it. Hague at least has the advantage that though well behind Clarke in popularity among party activists, he came well out in front of all his rivals.

But there needs to be a quid pro quo for widening the franchise, also pioneered by Labour. The autonomy of local associations has run out of control. There has to be a filtering process that ensures, initially at the very least in by-elections, that Central Office can impose its own short list to ensure a higher quality of candidate. That means imposing a much more rigorous process for weeding out some of the dodgier names on the current list of approved candidates. The most vital requirement however is for candidates in such seats to make their minds up by mid- term: the Tories need to revolutionise their approach to general election campaigns by ruthless targeting of winnable seats as both the Labour Party and, with almost as stunning results, the Liberal Democrats have done. He should appoint without delay his ally Archie Norman, one of the few Tory MPs to have run a spectacularly successful business, to reorganise the party.

But more than just the party machine needs an overhaul. First the policy review which he orders, probably under a new senior shadow cabinet member such as David Willetts, will have to recognise at least as clearly as Brown and Blair did after Labour's 1992 defeat what needs to be done to win back the uncommitted centre ground of British politics. That will be difficult: Hague owes his victory in large part to a group who still, despite all the evidence to the contrary, believe that the European threat to British sovereignty is the one issue that galvanises the British electorate.

Hague is lucky that he will be able to promote to senior positions politicians like Francis Maude and John Maples, relatively untarnished by the past few years. This was not a good result for John Redwood after his pact with Clarke: but it could still be prudent for the sake of right-wing unity to give him a job. Peter Lilley may become shadow chancellor but Hague should be careful about promoting too many of the old, familiar, discredited faces. Youth and freshness are his biggest asset.

He has proved that the factional organising skills which served him so well as an undergraduate politician at Oxford have not deserted him. Labour would be most unwise to write him off or yield too quickly to the temptation to patronise him. He won against quite difficult odds. But factional organisation is not what the Tory party now needs. To eliminate triumphalism among his own supporters, let alone the bitterness within factions as well as between them, will require almost superhuman qualities. For British Conservatism now stands at a watershed. Hague could start the long march back to power by beginning to interest sections of the electorate, like women and the young, who so deserted his party on 1 May. Or he could yet find himself presiding over the disintegration of what was once the developed world's most successful political party.