Thatcher Ouster Deepens Crisis Among British Conservatives

THREE candidates are battling to become Britain's next prime minister, following the resignation of Margaret Thatcher after a Cabinet revolt last Thursday. Michael Heseltine, whose strong showing in a leadership ballot last week dealt what proved to be a fatal blow to the woman who has led Britain for the past 11 years, is the frontrunner for a second ballot tomorrow.

The other candidates - Foreign Secretary Douglas Hurd and Chancellor of the Exchequer John Major - hope to head off the dynamic former defense minister, who has worked for nearly five years to become leader of the ruling Conservative Party.

By the weekend, Mr. Hurd and Mr. Major each had won the support of half a dozen Cabinet ministers, but yesterday Mr. Heseltine's challenge was endorsed by some of the ``big guns'' of the Conservative Party establishment.

Sir Geoffrey Howe, the former deputy prime minister, Nigel Lawson, the former chancellor, and Lord Carrington, a former foreign secretary and NATO secretary general, said they favored Heseltine to become party leader and prime minister. But it will be 372 Conservative members of Parliament voting in secret ballot who will determine the outcome.

Perceived ability to appeal to the British electorate promises to be the decisive factor in what on the surface is a gentlemanly campaign but which is stirring powerful political feelings.

``It is not their philosophies that will decide the outcome - it is their ability to lead their party to victory over Labour at the next general election,'' a senior Conservative backbencher said. ``They must be vote winners, not only at Westminster but across the country.'' He had voted for Mrs. Thatcher in the first ballot last Tuesday.

Hurd and Major threw their hats into the ring minutes after Thatcher's sudden resignation last Thursday. If there is no clear result tomorrow there will be a decisive third round two days later.

Last weekend, as the three candidates plunged into a round of nationwide television interviews, Conservative Party sources said as many as 100 MPs were still undecided.

Heseltine is holding to his promise to reform the unpopular poll tax. Last Friday Hurd and Major fell into line and made similar promises. Both said they were well placed to ``heal the wounds'' of the party.

Sir Geoffrey's support for Heseltine was seen by Heseltine supporters as a possibly decisive factor in swinging votes toward him. It was Sir Geoffrey's resignation as deputy prime minister earlier this month that precipitated the crisis which ended in Thatcher's humiliating resignation.

Public opinion polls showed Heseltine and Major slightly ahead of Hurd. But Richard Ryder, a Major strategist, said: ``We have got to look ahead to the 1990s. John is a young man. He appeals very much to people from all walks of life, especially the young.''

Major, at 47, is the youngest candidate. Hurd is 60 and Heseltine 57 years old.

At a news conference on Friday Major drew attention to his humble origins as the son of an unemployed circus performer. The other two candidates have an ``Oxbridge'' background. Major pledged to work to turn Britain into a ``classless society.''

At the weekend, he was drawing support from the right wing of the Conservative Party. Norman Tebbit, a former party chairman who had strongly supported the reelection of Thatcher, said he was backing Major as ``the man most likely to continue the Thatcher revolution.''

But Hurd, who has drawn attention to his role in the confrontation with Iraq, claimed that a lot of undeclared support would eventually swing his way.

Chris Patten, the environment secretary, who nominated Hurd, said: ``I think his experience, his wisdom, his calm authority are very important, and they are attracting increasing support. He has shown he is a good man in a crisis.''

Thatcher's resignation has intensified the crisis in the Conservative Party. That crisis was already serious before she returned from the European security conference in Paris, to be told by two-thirds of her Cabinet that she could not hope to beat Heseltine in the second leadership ballot.

The Conservatives are facing high inflation, rising unemployment, and a general public sense that the government has lost its way. That feeling is reflected in opinion polls which show the Conservatives trailing Labour by as much as 20 points.

Heseltine admitted Saturday that his support dipped when Hurd and Major entered the race, but that it had climbed beyond the 152 votes he gained in the first round. Most public opinion polls show that if Heseltine were to become prime minister the public mood would shift away from Labour, giving the Conservatives a lead over the opposition. Neither Hurd nor Major can make that claim.

Heseltine has also underlined the fact that for nearly five years he has held no Cabinet post, and cannot be associated with the policies that have brought the Conservatives so low.

On European policy, little divides the candidates, although Major tends to be more sceptical about economic and monetary integration than his two rivals.

Meanwhile, there was widespread admiration for Thatcher who six hours after her resignation appeared in the House of Commons and, in a censure debate sought by Labour, gave what was seen as one of the best parliamentary displays of her career.

Under the arcane voting system that will determine the result, a successful candidate needs at least 187 votes to win. If no one achieves that, the third round will enable MPs to register first and second preferences.

Supporters of Hurd and Major privately acknowledged yesterday that Heseltine was probably leading, but hinted that in a runoff they would combine against him. Heseltine was hoping that his campaign had achieved sufficient momentum to prevent his opponents' strategy from being effective.

One of Heseltine's backers said: ``At least one of the three isn't telling the truth about the support he has. If all the claims of support were added together, there would be about 500 Conservative MPs, instead of the 372 who will actually be voting.''

Mr. Lawson, as a former highly respected chancellor of the exchequer, seemed likely to swing votes to Heseltine. ``My interest is in deciding what is most likely to bring about a fourth successive Conservative general election victory,'' he said. ``I believe Mr. Heseltine has the best chance of achieving that.''