Clarke-Redwood alliance

Redwood: Declares for Clarke

Reversal of Fortunes in Leadership Race

As the battle for the Tory leadership reaches its climax, the party's arch Euro-sceptic has urged his supporters to hand the crown to its most prominent pro-European.

John Redwood, knocked out of the contest on Tuesday, has thrown his weight behind his one-time rival Kenneth Clarke, and urged William Hague to withdraw. At a joint press conference the two men even released a mission statement, outlining their common vision. Mr Clarke insisted it was an agreement built to endure through the next five years of opposition and into a Conservative government.

Later Mr Clarke revealed that he had agreed to make Mr Redwood his shadow chancellor as part of the deal to secure his support.

Hague wants a "fresh start"

... and not a deal of opposites.

Hague Against "an Agreement to Differ"

The second leadership contender, William Hague, dismissed the Redwood-Clarke alliance as "a deal not a solution". He said the Conservative party was crying out for unity, "but real unity requires a clear position around which to be united, not agreement to differ".

Mr Hague said a party could not win elections without "singing from the same hymn sheet" - and he acknowledged that the discipline of Tony Blair's Labour party during opposition would be his model for a "fresh start" for the Conservatives.

Shortly after the setback of the Redwood announcement, there was a further extraordinary twist in a contest full of surprises, when the former prime minister, Margaret Thatcher, endorsed Mr Hague.

"Had I a vote, I would be supporting William Hague in this leadership election," she said in a statement. She denounced the surprise pact between Mr Clarke and Mr Redwood as "an incredible alliance of opposites".

The race for the leadership has turned into a political soap opera, providing an almost daily diet of drama complete with betrayals, subterfuge and sudden reversals of fortune.

These dramatic developments set up an nail-bitingly close finish for the Thursday's third and final ballot of the 164 Tory MPs, with Mr Clarke as the favourite.

Europe has been the issue splitting the Tory party, and the Redwood camp had been profoundly Euro-sceptic. Mr Redwood was the only leadership candidate to say he would "never" take Britain into a single European currency.

It is this clash of ideals with Euro-phile Kenneth Clarke that makes the resolution of their differences that much more remarkable. But today Mr Clarke and Mr Redwood presented their new alliance at a joint news conference under the slogan "Uniting to Win."

Their message was that this was not a marriage of convenience, but a response to what Mr Clarke called "the very heavy duty to unite the party". They insisted there was no sacrifice of principle on either side, saying they agreed on almost every issue, except a single European currency.

However it was unclear just how many of his 37 votes in the second ballot Mr Redwood will be able to deliver to his new ally. One Redwood supporter, John Townend, the chairman of the influential 92 Group of right wingers, bitterly accused him of delivering the party into the hands of the left.

Mr Clarke needs another 19 votes to add to his second round total to guarantee final victory.

Mr Hague himself insisted that he could win over enough former Redwood voters to give him victory. "They are all individuals. Many of them have declared their support for me. Some haven't but I certainly hope to win over the majority of them," he said.

Lilley: "unnatural alliance"

The Tory former Social Security Secretary, Peter Lilley, a prominent Hague supporter since dropping out of the contest after the first round, called Redwood's support for the former Chancellor "a rather unnatural alliance" would not "really match the broad spectrum of support that William has assembled, including people like Michael Ancram, Michael Howard, Gillian Shephard and myself".

The former Chancellor holds "big-hitter" advantage with MPs who want a leader to frighten Labour. On the other hand Mr Hague is campaigning as a unity candidate who is young enough, at 36, to give the party a fresh start.

The Second Round Results

Mr Clarke emerged victorious in the second ballot, but with only a narrow lead over Mr Hague.

In the second round ballot, the results were as follows:

• Kenneth Clarke 64
• William Hague 62
• John Redwood 38

Mr Clarke is also favourite with the bookies, at one to three, while the odds on Mr Hague are two to one against.