Germany which initiated the stability pact to ensure fiscal discipline was also swift to signal yesterday that it would oppose any renegotiation of the

Germany, which initiated the stability pact to ensure fiscal discipline, was also swift to signal yesterday that it would oppose any renegotiation of the rules, which might encourage a “soft euro”.But Germany’s own governing coalition was showing signs of drifting towards the rocks amid rumours that Chancellor Helmut Kohl had threatened to resign four times last week, during the bitter argument still raging in Germany about the means by which the country can meet the Maastricht criteria for monetary union. He argued that jobs should be given new priority “at a European and national level”.Dominique Strauss Kahn, the new French finance minister, reassured partners that Lionel Jospin, the new French Prime Minister, is committed to the EMU launch on time, insisting that there was no call for “drama” or market panic. He also said France accepted the principle of budgetary discipline.But the French government also wants to adjust the pact to allow the creation of a form of political “economic government” to act as a counter-weight to the monetary discipline to be imposed by the future European central bank.Theo Waigel, the German finance minister, made clear he would oppose any move which could threaten the independence of the European central bank. France called for a rewriting of the pact, with more emphasis on jobs and growth, rather than focusing exclusively on tight fiscal discipline.Gordon Brown, the Chancellor, presented a British employment initiative to the Luxembourg meeting of European finance ministers, which appeared to support the French aims. Under the pact, countries which failed to keep within strict financial guidelines would incur heavy penalties. The new French demands immediately fractured the increasingly fragile veneer of consensus between France and Germany about how the euro-zone should be governed, how “soft” or “hard” the new currency will be, and inevitably raised new questions about the timetable for monetary union – set to be launched in 1999.
The French move will cast a pall over next week’s Amsterdam summit, when signature of the so-called “stability pact” for economic and monetary union (EMU) was to have been hailed by heads of government as a key achievement. At a meeting of EU finance ministers in Luxembourg, France refused to sign up to a pact which sets out economic rules for running the euro zone.

Any gross disparity between that and today’s ballot could add to pressure for party members to get a vote – as could reports that a party chairman in Essex was refusing to pass on his constituency ballot because it supported Mr Clarke, which he did not.. Europe’s projected single currency, which has already torn apart the Conservative Party and riven Germany, faced a fresh threat yesterday – France’s new Socialist government. They included Alan Clark who is undeclared, and Eleanor Laing and David Tredinnick who have declared for Mr Hague. Claimed declarations from the different camps put Mr Clarke and Mr Hague on 33, Mr Howard on 25, Mr Lilley on 22 and Mr Redwood on 17. That left 35 undeclared.Mr Clarke would win if the ordinary voters had a say: an ICM poll in today’s Guardian gives him 31 per cent, well ahead of second-placed Mr Redwood and Mr Hague, each on 9 per cent, with Mr Howard on 7 per cent and Peter Lilley on 6 per cent.Today’s voting, which starts at 10am in a Commons Committee room, will be preceded by the results of an advisory ballot of constituency party chairmen and senior activists.

Whoever gets most votes from the right could still give Mr Clarke – or Mr Hague – a close run in the final ballot on 19 June.But last week’s confident assertion of Mr Howard’s supporters that he was running second to Mr Clarke was badly dented by the fact that as many as half a dozen claimed votes have since defected. The whole idea sounded to me like PC gone mad, and if they weren’t married in the eyes of the law, what was the point? Although I’m not especially religious myself, I couldn’t help thinking: if you’re going to take the plunge, there’s nothing quite like a traditional church wedding, with confetti, posh hats, saucy best man’s speeches and weeping aunties. The uncertainties are aggravated by the possibility that Mr Clarke could top today’s poll – and still not have enough steam to get him the required 83-vote minimum to win the second ballot.He needs more than 50 votes today to remain a credible contender for next week.The right-wing were jostling for a contender who could pick up the Thatcherite banner – with Michael Howard, Peter Lilley and John Redwood all in contention. But with three dozen of the 164 Conservative MPs remaining uncommitted, the race was still wide open and frantic last-minute efforts were being made to woo and seduce the hard-to-get waverers.
For an outright win a candidate requires at least 83 votes – a majority of Tory MPs – and a majority of at least 25 votes over the runner-up, a lead of 15 per cent of MPs.No one is expected to get over those hurdles, in which case a second ballot will be held next Tuesday in a race that will be open to new contenders – and the possible withdrawal of any candidate who does particularly badly when first-round results are declared before 6pm tonight. Kenneth Clarke and William Hague were last night running neck and neck for today’s first round of the Conservative leadership contest, with declared supporters putting them well ahead of the rest of the field.

Someone had hired three actors, dressed as Mexicans, in sombreros and flared trousers, to picket the Lilley party with a placard declaring: “Portillo 4 el Presidente.”Tory MPs may have looked bemused, but if they had been given the chance, el Presidente Portillo would have had a walkover today.. I am sticking to the orange juice as I have three more parties.”William Hague, the young pretender, held his party in the traditional Tory stronghold of the Carlton Club in Pall Mall. Nick St Aubyn, the new MP for Guildford, was also touring the parties and as he stepped into the Carlton for champagne and canapes in the coffee room with Mr Hague, one of Mr Hague’s supporters said: “He is not undecided – he has been in the Lilley camp all along.”Michael Howard was holding court with a champagne party at the Westminster home of Jonathan Aitken, the former minister, while Kenneth Clarke, keeping up his blokeish image, was entertaining any Tory MP who wished to turn up at the Royal Institute of Engineers.But the missing ingredient last night night was the spice that would have been provided by Michael Portillo, who lost his seat at the election. Elizabeth Buchanan, Lady Thatcher’s personal assistant, caused a stir when she arrived carrying a briefcase, with Lilley supporters wondering whether she had a message from the former leader.Lady Thatcher’s former political adviser, Tory MP John Whittingdale, another Lilley supporter, said: “I think most people have made up their minds, and Conservative MPs are not going to be swayed by a glass of champagne.”But those touring the parties included Michael Fabricant who said: “I am undecided and I might vote for someone different in the second round. “My opinion is for rent and my vote is for sale,” joked Peter Bottomley, whose wife, Virginia, was already at the Lilley party. It was going to be a long night.The floating voters had five parties in succession, to sample the drinks and nibbles – and to taste the opinions of each of the candidates standing in today’s election for a Tory leader – and they needed a clear head.After cream tea with John Redwood and his wife, Gail, MPs sauntered across Parliament Square to the St Stephen’s Constitutional club for Mr Lilley’s party, where they were welcomed with glasses of the house champagne, laid on at pounds 22.50 a bottle, with smoked salmon nibbles and the chance to hear from the former social security secretary his views on the euro.