Election '97: Tory high command might think it makes Blair sweat

After Tony Blair had left the podium at his manifesto launch, set - inevitably for his New Labour Party - against a Union Jack back- drop, a bizarre telephone conversation took place.

His press secretary, Alastair Campbell, was overheard talking to Alan Clark, the maverick Conservative ex-minister who is a long-time friend. To the surprise of onlookers the phone was handed to the Labour leader. Pleasantries were exchanged.

Somehow, despite the launch of the three party manifestos and a fair bit of mud-slinging, battle has not yet been properly joined. Sleaze was left temporarily behind and issues did get more of a look in, yet a sense of unreality reigned. Thus Conservative Central Office devoted several hours to inspecting a video tape of Labour's manifesto launch to try to establish whether Mr Blair had been wearing an earpiece to aid his question and answer session. The Tories' best brains concluded reluctantly that the Labour leader simply has shiny ears.

The unexpected star of the election was a man dressed in a chicken costume hired by Central Office to highlight Mr Blair's reluctance to take part in a television debate. The chicken ended up in an unseemly wrestling match with a rival from the Mirror but even Labour spin doctors conceded that the pantomime animal had "connected with the voters".

In the bubble of London campaigning it has been a rather better week for the Conservatives. That is not saying much after the resignation of three Tory politicians the previous week. For a time, at least, the manifesto launches focused attention on tax and spending, traditionally a successful platform for Conservatives. The party's attack on that front was slightly blunted, however, by its manifesto commitment, unveiled on Wednesday, for transferable tax allowances between married couples where one stays at home as a carer. The policy may be popular with some two million married couples but Kenneth Clarke, the Chancellor, was unable to explain how it would be funded or convince everyone of the accuracy of the estimated cost of pounds 1.2bn.

That did not prevent him from turning his guns on Labour over what he claimed was a pounds 12bn "black hole" in its spending plans. The Shadow Chancellor, Gordon Brown, has promised to stick to Mr Clarke's Treasury projections and the Tories went about picking holes in a flank which Labour has spent years trying to defend. There were several prongs to the attack but the most effective was the money factored in to the Tory plans for pounds 1.5bn privatisation receipts in 1989-9 which, the Tories argued, Labour would have to find elsewhere. Mr Brown promised to consider Tory plans to privatise the national air traffic control system, only to have the words of Andrew Smith, Labour's transport spokesman, thrown back at him. In last year's party conference Mr Smith had argued: "Labour will do everything it can to block this sell-off. Our air is not for sale."

That Labour could counter with the charge that the Tories have an uncosted tax pledge showed the party was in a far better position than in 1992. But the Tories are probably right when they say that their focus groups show that, despite voters' anger with the Government, they ultimately believe "the Labour Party will end up taxing and spending more".

However, even if the Tories won narrowly on the issue, the debate may be as relevant as the chicken. The consensus among economists is that whoever wins the election will be putting taxes up, rather than lowering them. Indeed Mr Clarke's Treasury projections show the tax take rising from pounds 36bn in 1996-7 by one quarter of a billion pounds in each of the subsequent years.

On devolution the Tories also managed a hit, with what they claimed was a gaffe by Mr Blair, comparing the tax-raising powers of his proposed Scottish parliament to a parish council. Although it caused a rumpus in Scotland the comments were projected by the modernisers as a message of reassurance for southern voters and for Scots who fear paying more tax. In any event today's MORI poll casts doubt on the salience of the devolution issue to voters.

It was surely more than a Freudian slip that the Deputy Prime Minister, Michael Heseltine, referred to last week as the "first week of the campaign". Central Office now has Mr Blair in its sights. One source claimed Mr Blair had been unsettled during his manifesto press conference and had been "perspiring profusely". The accusation is that the Labour leader "requires two hours' briefing before he does an interview", and that before speaking to the BBC and ITN last week he was seen "shaking".

Labour dismisses that as black propaganda, but Mr Blair's minders believe that anyway Tory concentration on the Labour leader will rebound to their credit. He is, after all, probably Labour's best asset. As one source put it: "The biggest group up for grabs are wavering Tories who have not made up their minds about us. The more they see of Tony the less they believe what the Tories say about him. And they are going to see him wall- to-wall".

The Conservatives have gained from two other factors, though: some of the traditional Conservative papers - the Daily Telegraph and, to an extent, the Daily Mail - are being more supportive. They have been helped too by the Liberal Democrats' plan in their manifesto to raise 1p in the pound of income tax to pay for education. As one minister put it: "We have gained from Labour and the Liberal Democrats sniping at each other. Labour is saying the Liberal Democrats are irresponsible. The Libs are saying Labour's sums don't add up. Both reinforce our argument."

Labour is suffering from "reverse incumbency factor", having difficulty conjuring up alarm about a fifth Tory term because most people simply believe it is an impossibility. And, as one Labour source put it, "the trouble with the media is that it seems to regard John Major as some sort of cripple. So if he walks down the street without falling over, that counts as a success."

Yet the evidence from the polls is that Mr Major's chances have stubbornly refused to shift. Labour now has a sizeable lead on economic competence, for example.

Perhaps that is because the intricacies of the Westminster briefing war have not impinged on large chunks of the public. Many of the landmarks of an election - canvassing, posters in windows, Election Call - have just started to appear. Politicians on tour have had enthusiastic receptions but the campaign itself has not captured the public imagination yet. The BBC Nine O'clock News, now extended to one hour, has lost a big chunk of its audience. As one Conservative worker put it: "The chicken summed it all up for me. It's staggering but I don't think people realise we are in a campaign. Perhaps it's because it's been going on unofficially for so long."

One minister asked his doctor for foot-powder last week, saying he would be doing a lot of walking in the next few weeks. "Oh," came the reply, "are you going on holiday?"