Duncan Smith puts money on Tories to win general election

Flushed with his party's best electoral performance under his leadership, Iain Duncan Smith was yesterday confident enough to place a bet on himself winning the next general election.

On a visit to celebrate his party's gains in Guildford, the Tory leader's stake was £100 when he took advantage of the generous 4-1 odds quoted by Coral's against him getting to Downing Street.

But, as he shrugged off the "irrelevant" close-of-poll attack on him by Crispin Blunt, it was far from clear whether Mr Duncan Smith's leadership was genuinely out of the woods or whether another, more deadly ambush lay in wait.

When he arrived at Conservative Central Office yesterday to cheers from party helpers, the Tory leader certainly at last had something to smile about. With nearly 700 net gains of seats, making his party the largest in local government for the first time since 1989, he declared 1 May a "spectacular" result and called on his colleagues to concentrate on fighting for further progress. Mr Duncan Smith said the party was "sick to the back teeth" of internal battles and "navel-gazing".

But several rebel backbenchers contacted by The Independent made clear that although Mr Blunt had perhaps mistimed his attack, the disillusionment at Westminster with the leadership was real.

"Iain has got over a big hurdle, there's no denying that," one MP said. "But it's not as if he's free with one bound. As leader, you've got to keep clearing the hurdles and there are plenty more to come."

The first such hurdle comes on 12 May when the party's ruling board meets to discuss the thorny issue of Barry Legg, Mr Duncan Smith's choice as combined chief of staff and chief executive.

Mr Blunt hinted at this yesterday when he referred to criticism of the leader by "senior members of the voluntary party". Several senior board members are determined to block Mr Legg's appointment as chief executive and it was claimed yesterday that his lawyers were trying to negotiate a severance package. The Tory leader surprised the board last weekend when he claimed it had confirmed Mr Legg's contract and suggested he would not be moved.

Although an apparently trivial matter, the issue could explode if the board sticks to its guns and defies Mr Duncan Smith's authority.

The next hurdle would be the party conference in October, when the leader's general election manifesto will, in effect, be launched with a whole lot of new policies.

However, many MPs said yesterday that they couldn't wait that long. Mr Duncan Smith's chances of surviving increased as each month went by, and, unless a challenge was launched before the summer, he could stay in post for the rest of this Parliament.

Part of the problem for Mr Blunt and those of similar mind is that, although there are embryonic leadership bids already formed, no one is ready to attack just yet.

Both Kenneth Clarke and Michael Portillo yesterday flew out of the country for family holidays. Mr Portillo told friends that Mr Blunt had made a major misjudgement in acting without knowing who he wanted as leader.

One frontbencher said that Mr Blunt had made it "marginally" more likely that the 24 names needed for a no-confidence vote could appear as early as next week. "When everyone comes back next week and the dust has settled down there may well be enough colleagues who feel that we still aren't making enough progress in the polls despite the council gains. There is a feeling that if we don't do something now, Iain may survive until the general election," he said.