KENNETH CLARKE has given his strongest hint yet that he will stand in the Conservative leadership contest, even though supporters believe that his chances of winning are slim.

The former Chancellor used a speech to the Tory Reform Group last night to say that the Conservatives can win the next election as long as they have a leader who can take on Gordon Brown.

“The more I consider my options, the prospect of my becoming a candidate by the autumn becomes more attractive,” he said. “I am listening to my parliamentary colleagues. Whatever I decide, I know this, that it would be a real privilege to be the person who could lead this party from Opposition to Government at the next election.”

The party must offer solid policies on the economy, health, education and pensions, Mr Clarke said, as well as choose a leader capable of challenging the Chancellor.

“He [Gordon Brown] is an experienced, formidable campaigner who will need to be challenged on his economic record as well as his broader domestic agenda if he is to be defeated in today’s presidential electoral politics,” he said.

It would be the third time that Mr Clarke, who is 65, has contested the leadership. He was defeated by Iain Duncan Smith in 2001 and by William Hague in 1997. Although he is liked by voters, his popularity with MPs and party activists has always been tempered by his pro-European views.

But the demise of the European Union constitution and diminishing prospects of Britain joining the euro mean that the EU is now less of an issue.

Mr Clarke’s supporters, though, are frustrated that he has not made more of an effort to build support among MPs before the summer recess, allowing David Davis, David Cameron and Liam Fox to secure important votes.

“He hasn’t been doing much to help himself but I believe, despite the odds, he will stand,” one supporter said yesterday.

The party has still not agreed how it will elect the next leader. MPs started voting yesterday by secret ballot on a deal that gives them back power over the leadership. That would replace the present system, which gives grassroots members the final say on a shortlist of two, decided by MPs.

Senior party figures said that it was “touch and go” whether the new proposals would get the required two-thirds majority, with a sizable minority of MPs determined to protect the voting rights of activists.

Michael Howard, the party leader, has made a last-minute plea to his MPs, asking them to back the deal and saying that although the terms are not his first choice it may be the “best and only” chance to change the rules.

Tory MPs have been warned that if they reject the deal they will have to fight the leadership under the existing system, which would mean a lengthy and costly campaign in the constituencies. If they back the changes they will go forward to the Constitutional College on September 27 for approval.

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