Trouble for Tory chairman as rival turns loyal defender of Duncan Smith's reforms

Speculation about the future of Theresa May, the Tory chairman, intensified yesterday after a leading frontbencher warned that the party was in danger of becoming "complacent".

Tim Yeo, the shadow Trade and Industry Secretary, also claimed that Iain Duncan Smith's attempts to reshape the party were being "blocked" by elements within Conservative Central Office.

Mr Yeo's critics accused him of seeking to replace Mrs May with "a job application in all but name". Modernisers accused him of betraying Mrs May, while traditionalists claimed he was trying in vain to make up for being less than loyal earlier this year.

The Liberal Democrats ridiculed the latest round of infighting as summer "madness" which proved the Tories were still failing to make real headway in the polls.

Lord Bell, one of Mr Duncan Smith's advisers, recently accused Mrs May of "damaging" the Tories by describing them as the "nasty party" in her conference speech last year.

Mr Yeo appeared to add to her troubles when he said: "The party needs to let Iain Duncan Smith lead in the way that previous leaders have.

"At the moment there are too many elements in the organisation which act as blocks against what he is trying to do."

He also warned Conservatives against "complacency" after their recent upturn in the polls. The Government's difficulties did not mean voters would automatically turn to the Tories. Mr Yeo said, and Conservative Central Office should focus resources with "laser-like intensity" on target seats.

"In the end that's where votes are needed," he said.

"We have to be disciplined in saying that's where the resources will be concentrated, where members of the Shadow Cabinet will spend their time, where professional staff will spend their time, where money is directed."

Mr Yeo warned eight months ago that 2003 would be a "make or break" year for Mr Duncan Smith. Yesterday he said the Tory leader had passed the local-elections test with "room to spare" and could now claim the party's "unstinting support" through to the next election.

Mr Yeo said the results in May had raised Tory sights from the 100 seats generally regarded as a "great result" at the next election. "Our expectations have been greatly raised," he said. "The post-Blair era is coming over the horizon."

One leading modernising MP said Mr Yeo's criticism should be directed at hardliners in Central Office, not at Mrs May. A traditionalist was equally scathing: "It was so obviously a job application. Sadly for Tim, the damage was done earlier this year."

Mark Oaten, chairman of the Liberal Democrat parliamentary party, said: "May may stay, or May may go, but the simple fact is that the Tories are unwilling and incapable of being led as a party whoever becomes leader and whoever chairs the party."