New Clause IV divides Tories

Conservatives appeared divided yesterday in their response to the rewriting of Labour's Clause IV, while John Prescott was greeted by Labour cheers as he quoted from the rewritten version in the Commons for the first time.

In the past few days, Douglas Hurd, the Foreign Secretary, and Michael Portillo, Secretary of State for Employment, have struck sharply different attitudes to Labour's change.

On Monday, Mr Portillo described the new clause as "400 words of waffle" - before he had seen it - and said: "Weasel words will not disguise the clear truth. Labour's socialist instincts remain. They want higher taxes, more spending, and they want to extend state control."

But on Friday, Mr Hurd had warned the Conservatives to be ready to repel boarders: "Mr Blair is trying to board the Conservative ship and run up his own flag on our masthead." He urged the party to stand its ground, and in effect compete with Mr Blair as the genuine Conservative article - an approach known in Central Office as the "real thing" or "Coke" strategy.

When Mr Prescott in the Commons contrasted Conservative tolerance of "boardroom greed" with Labour's desire to see wealth "in the hands of the many not the few" - a phrase from the new clause - Conservative backbenchers again attacked from two different directions.

Jacqui Lait (Hastings and Rye) repeated Mr Portillo's description of the new Clause IV as "400 words of waffle", while Harold Elletson (Blackpool North) invited Tony Newton, standing in for the Prime Minister, to "speculate on the possible reasons why the historic commitment to full employment, endorsed by generations of Labour Party members, has now been abandoned by Tony Blair".

Mr Newton, the Leader of the House, said: "What is absolutely clear is that it takes us no nearer at all to what we really need, which is some clarification of Labour's policies."

Meanwhile, there are signs that the battle in the Labour Party over its direction is moving on to new territory. The giant public services union Unison yesterday signalled the beginnings of a revolt against the Labour leadership's refusal to set a level for a minimum wage, an issue likely to dominate October's annual party conference in Brighton.

A spokeswoman for the union rejected the idea discreetly floated by Mr Blair two weeks ago that Labour would not even set the level in its election manifesto, but only when it was in government.

"It is important that a figure should be put before the British people at the next election," she said. At the Scottish Labour conference in Inverness over the weekend, a Unison motion demanding a minimum wage of £4.15 an hour was carried unanimously.