All eyes on the prize fight: Heseltine is not fanning the flames himself, but is not actively dousing them either

WOULD-BE champions are weaving about and punching the air. Eventually, this year will either provoke a re-run of the cabinet revolt that destroyed Margaret Thatcher's premiership, or it will preserve John Major to preside over economic recovery and try for a second election victory.

For Mr Major this may be his last chance of self-preservation. For ministers who want his job, 1994 represents a last chance of glory. There have been rumbles from Michael Heseltine's camp. Other contenders, notably Kenneth Clarke, have a tactical dilemma: should they respond? Is a fight on the cards, boys, or not? Around Westminster the tipsters and departmental tacticians think it is.

Since even the limbering up of candidates as weighty as the Henley Hammer and the Midlands Marvel would destabilise the Tory party further, this is bad news for Mr Major. For the rest of us it will be a fascinating tactical dance to watch.

At first sight, Mr Major's position now looks nastily similar to Mrs Thatcher's in 1990 - the terrible polls, the deeply divided party, the almost impeccably loyal formulations of Mr Heseltine. For poll tax, read tax rises. Even the scale of backbench hostility is comparable to that, say, six months before Mrs Thatcher's fall. Just as in 1990, the sacked and the unpromoted make up a hard core of dissent, who can be finally destructive only if they win support from would-be loyal but panicking backbench colleagues, and then persuade ministers to resign or (less honourably) tacitly to support a contest while remaining inside the tent.

But there are big differences, too. First, there is the precedent, and a general sense that doing the same thing again might be chancing it once too often. Second, the electoral timing is better for Mr Major than it was for Mrs Thatcher in the last cycle of Tory hysteria. At the same stage of maximum danger, Mrs Thatcher was nearly a year closer to the final date for a general election.

She had also been in power for longer than any modern predecessor. Her cabinet, the promoted spawn of a younger generation, did not feel personally close to her. At a seminar this week held by the Institute of Historical Research, Nigel Lawson and Lord Armstrong, cabinet secretary under Mrs Thatcher, openly discussed how she had lost touch with her cabinet during her third administration. Lord Lawson spoke of a 'steadily widening gulf between her and her cabinet colleagues'. Lord Armstrong thought she had become out of touch with her ministers, backbenchers and the outside world, 'cocooned' by her office and its heavy security.

None of that applies to Mr Major. He is still relatively new, and keeps closely in touch with the key cabinet ministers. If anything, he isn't cocooned enough. And the divisive issues that shredded the bonds of trust between senior members of the Cabinet under Mrs Thatcher are not present to the same extent today.

During the past few days, for instance, there has been a series of tense private meetings to discuss Britain's policy on the row about qualified majority voting in the European Union, which is both hugely important and sensitive. The meetings involved Mr Major, Mr Clarke, Douglas Hurd (by phone), Mr Heseltine and Michael Howard - so both wings of the European debate were there. But they have been collegiate and consensual by comparison with the histrionics and brinkmanship of the European arguments in 1989-90.

So Mr Major has cause to believe that backbench unease will not combine explosively with detonations inside Cabinet, as happened then. And yet . . . for each leader, there are new threats, fresh dangers to think about. Mr Major frightens his colleagues not at all, as Mrs Thatcher did. Lacking any awe, today's potential contenders within government may be more willing to make their case semi-publicly for a change. Mr Heseltine has started the speculation again and, for him, it is this year or never. He is not fanning the flames himself, but is not actively dousing them either. And all the President's men have been seen scurrying round Westminster corners with jerrycans of petrol.

Mr Heseltine, unlike his main rival Mr Clarke, has the backing of some real Thatcherites, in the party and in the media. They see him as a pragmatic opportunist who, because of his age, would be a good stand-in until Michael Portillo comes of age. Better a few years of 'Hezza', in debt to the right, than a decade of bloody Clarke. This enthusiasm is not shared by the Baroness who, being only human, still sees him as a bad'un. It would not be surprising if friends of Portillo tried to persuade her to soften, or at least keep quiet, should some Faustian bargain be struck. It is a nice irony that the strength of Mr Heseltine's position may come to depend on strategic decisions by the Thatcherites.

This all gives the Clarke camp food for thought. The Chancellor is firmly against the kind of great philosophical speeches that would tell everyone a fight was on. He is against hysteria. His admirers think silence would be tactically wise, too, and that Mr Heseltine has done himself no good by moving so fast. Yet Mr Clarke cannot afford to let a Heseltine bandwagon get going. If it seems to be, he will have to respond.

It is already possible to discern the likely lines of attack of Heseltine on Clarke and vice-versa. Mr Clarke's people would attack the President as a destructive force, shamelessly using a period of passing unpopularity to destabilise another Conservative government. The Chancellor would be presented, by contrast, as a principled but pugnacious doer, a natural radical. He is still a keen privatiser, a knocker of vested interests and an ardent political centraliser. Watch for the phrase, 'Thatcherism with a human face'.

Heseltine's people, meanwhile, will portray him as a brilliant and sure-footed campaigner, a pragmatist on Europe, as against Clarke's Euro-mania, and a right-wing deregulator. The Chancellor is already blamed for admitting that higher Tory taxes are equivalent to a 7p in the pound hike in the basic rate of income tax. The anti-Clarke Tories are accusing the Treasury of letting the tax row run on for weeks, virtually unanswered. Is that the kind of gaffe Hezza would have made? Ho no, my lads . . .

Both men, in short, are weighing each other up. The fact that both are from the same wing of the party, and need to appeal to the right, would make it a dirty, bare- knuckle contest. So far, no blows have actually landed. Musculature is being assessed, their friends

are active, their skills are much compared.

Mr Major appears almost irrelevant to all this - indeed, his supporters will be pleased to see a certain amount of mud flying between the rival Presidential and Chancellorial camps. But if blows start to land between these two, then stand well back. The pent-up fear and frustration in the Tory party will echo round Westminster and a leadership contest will suddenly seem much, much more likely.