Leading Article: Mr Major's authority at stake

WHEN he wakes up in the morning, John Major must sometimes wish the mantle of leadership had not fallen upon his shoulders. The past 10 days have been dreadful. His economic and European policies have been undermined. His party's divisions have been exacerbated. One of his closest friends in the Cabinet has had to resign. On the same day, the Prime Minister was comfortably beaten on points in an emergency debate in the Commons by John Smith, the new leader of the Labour Party. To cap it all, Labour - so recently demoralised by its fourth consecutive defeat - will go to its party conference on Monday much cheered by the dramas of the past fortnight. Mr Major will need political skills of a high order to rally morale and foster unity at the Conservatives' own annual gathering in Brighton a week later.

Few things can be more depressing for a prime minister than to seem the victim of events. Mr Major had vowed that the pound would not be devalued. It was sunk by the speculators. He was committed to keeping Britain, politically speaking, at the heart of Europe. It is now in danger of being returned by the original Six (less Italy) to the periphery in a two-tier Europe. He stood by David Mellor even while the tide of opinion in the party was turning against his friend. Mr Mellor was forced to resign. It is thus from a very weakened position that the hero of the April election has to reassert himself.

Leadership is easily called for, less easily manifested. Mr Major does not have the natural authority that Michael Heseltine, for example, emanates. He comes across as decent, honest and intelligent, but the banality of his speaking style is a handicap. He would not be where he is, however, unless he had a core of toughness. That is what he now needs to show. When he has just been forced by events to break his most powerfully expressed commitment - no devaluation - it will take time and skill to rebuild his credibility. Little progress has so far been made: Norman Lamont has, against the odds, done better.

Against this backcloth, Mr Major's speech to the party in Brighton acquires a daunting importance. He must remember that it is difficult to assert authority while trying to face in several directions. He cannot credibly and at the same time placate Tory Europhobes, reconstruct his European policy and fulfil his responsibilities as president of the EC Council of Ministers.

Disagreeably perhaps for a natural conciliator, he must show where he stands and see off the motley gang that has been unable to support government policy - and has failed even to realise the extent to which Maastricht pushed the EC closer to their anti-Brussels conceptions. He must spell out the extent to which these people are fantasists without any serious agenda. His principal target will be those of no fixed intellectual abode who believed that progress towards European integration was inevitable - and now think the opposite. Mr Major must show these 'inevitabilists' just how intellectually bankrupt the Europhobes are.

Labour's best tactic, as its leadership has realised, is to point up the Conservatives' divisions by emphasising its own European credentials. To go back on the party's conversion to Europe for the sake of a short-term victory on the Maastricht treaty would set back the whole modernisation process. Apart from a small reduction in the power of the block vote, constitutional change is not on the agenda this year at Blackpool. But the modernisation process must go on, however tempting it may be to concentrate on rejoicing over the Tories' difficulties.

It is true that Labour is also divided over Maastricht. But the divisions are of a different nature. A tiny minority is, like the Tory and Unionist dissidents, fixated about sovereignty. A younger and larger group sees Maastricht as an unduly deflationary central bankers' treaty, and wants something more people-oriented. And then there is the very vocal Bryan Gould, New Zealand-born and long hostile to the EC in all its forms. His position in the Shadow Cabinet has surely become untenable: the back benches are the natural habitat for those who actively undermine the leadership's policies.

In the present circumstances, Labour does not really need its own detailed economic policy. It cannot be seen to dilute its recent conversion to anti-inflationary policy. All it need proclaim is that it would bring greater competence to its execution than the Government. Empty though that claim may be, a great many more people will be inclined to believe it now than before the events of the past two weeks.