MR JOHN MAJOR'S government was rocked last night by the resignation of Mr David Willetts, the Paymaster General after he was accused of "dissembling" before a key Commons committee.
And the Conservative ship of state was battered by further rows over Europe. The Chancellor, Mr Kenneth Clarke, was jeered by Tory Euro sceptics at the start of a two day Commons debate when he denied that Economic and Monetary Union would lead to a European superstate.
Meanwhile, the recently deselected Sir Nicholas Scott warned the Tories "could be out of power for a very long time" if they moved further to the right.
On the eve of the Barnsley East by election - which will leave the Conservatives without a Commons majority for the first time in 17 years Sir Nicholas also disclosed that he would like to see Mr Chris Patten, now Governor of Hong Kong, as prime minister and leader of the Conservative Party.
Labour's deputy leader, Mr John Prescott, said Mr Willetts's resignation was "another massive embarrassment for John Major - yet another - example of tee government disintegrating before our eyes".
While the government is not yet in an actual minority, senior Labour figures have revised their assessment of Mr Major's chances of staying on until May - with some members of the shadow cabinet predicting he will be forced to call a general election in March.
Mr Willetts resigned within minutes of the publication of a report by the Standards and Privileges Committee following accusations that he tried to interfere in an inquiry two years ago by the now defunct Members Interests Select Committee into the role of the former minister, Mr Neil Hamilton, in the "cash for questions" affair.
Mr Willetts, then barely an apprentice whip, wrote a now notorious memo to the committee chairman, Sir Geoffrey Johnson Smith, suggesting they might exploit "the good Tory majority" on the committee to conclude the inquiry as quickly as possible on terms favourable to the government.
The all party committee yesterday said the conversation between Mr Willetts and Sir Geoffrey went "beyond what should properly have taken place". But while stopping short of demanding Mr Willetts's suspension from the Commons, the committee offered a brutal assessment of his subsequent written and verbal evidence to the inquiry, saying: "We cannot accept much of the memorandum submitted to the committee by Mr Willetts, or much of his oral evidence, as being accurate."
The report continued: "We are very concerned that any Member should dissemble in his account to the committee, and believe that this response by Mr Willetts has substantially aggravated the original offence." It then reached the damning conclusion: "We have decided that, in any future investigation of matters of privilege or of complaints about the conduct of Members, it will be our normal practice to take evidence on oath."
In his resignation letter, Mr Willetts told Mr Major he was "very sorry" that his integrity had been called into question and insisted he had told the truth. However, he said: "In the light of their report, I believe the only honourable course is to resign."
A US Congressman is calling for an investigation to determine if the British intelligence agency, MI5, tried to discredit an aide to Mr George Mitchell, President Clinton's envoy on Northern Ireland.
Representative Peter King, a New York Republican, said he wants to find out if MI5 was behind stories in the British newspaper, The Mail on Sunday, on December 1st that alleged Ms Martha Pope, an aide to Mr Mitchell, had an affair with Mr Gerard Kelly of Sinn Fein.
Ms Pope said she never met Mr Kelly.
Mr King, in a letter he made public yesterday to the US Secretary of State, Mr Warren Christopher, said, "There is reason to believe the MI5 created this scandal in an effort to discredit Pope, and thereby Senator Mitchell, and in effect, derail the entire Irish peace process.
"I am calling on you to demand that the British government conduct a thorough investigation of this incident and determine if its intelligence agencies were involved," Mr King wrote to Mr Christopher.
Mr King is a frequent critic of the British government's policy on Northern Ireland.
"If MI5 was involved, the British government owes the American government a direct apology. If there was no MI5 involvement, the British government must state so unequivocally," he said.