Moments That Made The Year : Infected by mad cows and Europhobes

Blair has been canny, but the Tories dug themselves ever deeper into the mire, says Donald Macintyre

You are a Tory Cabinet minister. You are ambitious. You are spending Christmas at home thinking in deepest privacy of what 1997 will bring.

You look at the opinion polls. What does the phrase "election campaign" make you think about first? Is it (a), the gruelling prospect of three weeks stomping up and down Britain straining every fibre of your body to help secure your party a record fifth term in office against all the odds? Is it (b), a good job at Lazards or (c), something you would prefer not to think about at all? Or is it (d), another election altogether: the battle for the votes of the Tory party to succeed John Major and become its eighth leader since 1945?

If it's (b) or (c), you've probably got one of those marginal seats which look doomed. If it's (d), you're one of at least half a dozen senior members of the Cabinet, who thinks that he or she can be leading the party by the end of the year. If it's (a) you're probably John Major. That, in sum, is how bad 1996 was for the party which has governed Britain since 1979. It wasn't the crises themselves, though goodness knows there were enough of those. It was more that this was the year that the economic recovery was finally supposed to translate into votes and didn't.

It's why Tory MPs would discuss the prospect of electoral defeat with an openness, sometimes even with a relish, that has been unknown in any party since Labour was in its darkest days in the early 1980s. It is why some of the brightest stars on what was once thought to have been the left of the party, such as Stephen Dorrell and Malcolm Rifkind, started to court the neo-Thatcherite right wing which they believe will dominate the party after polling day. Perhaps the speech Mr Dorrell made back in May - not long after the Tories lost an awe-inspiring 567 seats in the local elections - will prove, in its own way, a turning point. In it, the Secretary of State for Health deftly became at once state-shrinker and Euro- sceptic in the same speech, bewilderingly proclaiming that Margaret Thatcher had really been a "one nation" Conservative. By that time of course, most people had already forgotten that in January she herself had witheringly dismissed the term in a speech of her own which derided the recent defection of Emma Nicholson to the Liberal Democrats, but which also managed to be notably unhelpful to Mr Major. Only Ken Clarke, and though he was less public about it, Michael Heseltine, stubbornly refused to trim like this.

More of that in a moment. Consider first the level of Tory indiscipline given that this was the last full year before an election. It was that on issues as disparate as divorce and the sale of MoD homes, large groups of rebellious backbenchers were prepared to flout the iron law that voters distrust divided parties. Against this background perhaps one Tory rebel qualifies as backbencher of the year for being - literally - on the side of virtue: it was Quentin Davies, who voted against the Government over the Scott arms-to-Iraq report.

And it was Mr Davies who helped Parliament to start cleaning up its act with a relentless cross-examination which exposed the untruth at the heart of the testimony by the minister David Willetts against charges that he had been tampering with a quasi-judicial inquiry into sleaze. Mr Davies got precious little thanks for it. But it was his colleagues who were doing the real damage: even as the country absorbed the shock of Dunblane, a majority of Tory MPs on the Home Affairs Select Committee set about trying to prove that the gun lobby needed appeasing more than the town's stricken parents. This was defiance of electoral gravity on a heroic scale.

But above all, of course, it was Europe that made the disintegration look terminal, that became for so many an issue bigger than party. The coalition of phobes, sceptics and those bullied by both, refused to give up, as Mr Clarke had predicted they would when he agreed in April - despite having seriously contemplated resignation - that any future decision to join EMU would be put to a referendum. In return he secured a deal written in blood that Major would not rule out joining EMU - a deal that the sceptics then set about trying to unravel in a campaign which still isn't over. What's more, the boundaries of the argument changed. Gradually, it became possible to talk about withdrawal from the EU. For this, the catalyst - even more than the fear inspired by Sir James Goldsmith's Referendum Party - was probably the crisis over BSE.

The BSE debacle became at once the most potent symbol of government incompetence and the crucible on which a muscular new anti- Europeanism was forged on the Tory right. The Government declared a war on Europe it couldn't win - with an Alice in Wonderland policy of non- cooperation which amounted only to vetoing those proposals which it would have previously have approved because they did no damage to Britain.

It is tempting simply to blame Mr Major for allowing all this to get out of control. But that fails to give enough credit to Tony Blair. True, Mr Blair had at times to do little more than watch the disintegration. True, also, that he wasn't trouble free in 1996. There were even some symmetries: as Lady Thatcher had undermined Mr Major in January - leaving until October her electoral endorsement of Mr Major - so Lord Callaghan in December gently sniped at the Labour leader in a recent interview in the New Statesman.

John Major had his own worst week (the most recent of many) in December which began when a ham-fisted attempt to re-open the EMU issue infuriated his Chancellor and ended when the MP John Gorst threatened to desert in defence of his local hospital. Tony Blair had his worst week back in January when Harriet Harman created an earthquake by sending her son to a grammar school. There are still after- tremors and more may follow in the election campaign.

But that doesn't alter the fact that throughout this year much of the Tory party has behaved as if it didn't expect to win for the very reason that Mr Blair had made Labour look convincingly electable again.

Ignoring the siren voices urging him to take more electoral risks - on Europe, on tax, and on spending - he has painstakingly reinforced the theme of the draft manifesto which he unveiled in July: that Labour will not promise more than it can deliver. He underlaid it, what's more, with a subliminal message that he will deliver more than he promises. This is no mean achievement.

The polls may, if not lie, exaggerate. The Tories will not waste the pounds 10m they intend to spend from the new year. Labour cannot yet be sure of winning. But the Tories ended the year no better than they began it. And that, they never expected.