Tuesday, June 15, 1999 Published at 11:42 GMT 12:42 UK
Lilley: The fall guy
Peter Lilley: Former Cabinet minister
Deputy Conservative leader Peter Lilley's future had been in doubt since April.
Mr Lilley's demotion is the price for a divisive row prior to May's elections in which Mr Lilley was accused of attempting to bounce the shadow cabinet into abandoning Thatcherism.
He has also been blamed by some MPs for lack of progress with the policy review which will set the agenda for the next general election.
But it was his Rab Butler Memorial "limits to the market" speech which paved the way for his demotion.
In it, he said: "We will only [renew public confidence] if we openly and emphatically accept that the free market has only a limited role in improving public services like health, education and welfare."
It was probably his most high profile performance since he sang a critique of new Labour at last year's party conference to the tune of Land of Hope and Glory.
The speech led to accusations from some Tory MPs that the party was betraying Baroness Thatcher by appearing to distance itself from her free market ideology.
Tory leader William Hague was forced to make an unscheduled address to the 1922 Committee in an attempt to put a lid on the affair after being attacked by the likes of Ann Widdecombe and Michael Howard.
Ironically, the speech coincided with celebrations to mark 20th anniversary of Baroness Thatcher's election victory.
And it had been delivered by one of the Tories' leading monetarists.
Mr Lilley is an economist by profession, who made his reputation combating fraud in the social services, with a series of measures to restrict benefits only to those entitled to them.
He was elected MP for St Albans in 1983 after a position as research director at Tory Central Office, although at the last election, he fought the Hitchin and Harpenden seat.
Within a year of coming to Westminster, he was made parliamentary private secretary to Nigel Lawson and survived at the Treasury, where he was promoted to financial secretary, until 1990.
That year he was appointed secretary of state for trade and industry and in 1992, until the Tories lost power, he held the position of social security secretary.
His promotion to the Cabinet was over the heads of several longer-serving ministers, and it was suggested at the time that that was because he was a hardliner with views similar to those held by Baroness Thatcher.
On the Conservative frontbenches he launched attacks on single mothers who "get pregnant just to jump the housing list", on "benefit tourists" coming to the UK armed with a spongers' phrasebook to claim the dole, and on the EU's scope to force "policies made by foreigners, for foreigners, which only foreigners can change" on the UK
But Mr Lilley was retained by Mr Hague as shadow chancellor until last year when the Tory leader promoted him to the position of deputy leader, a post which had been in abeyance since Willie Whitelaw held it in the 1970s.
If April's speech is the reason by his current popularity, it could be of some comfort to him that this is not the first time Mr Lilley has been out of favour with his party leader.
He was one of the ministers John Major was referring to in the infamous "Bastardgate" episode.
In comments intended as private but which ended up on the front pages, the then-prime minister described how a number of his colleagues of dubious parentage and Eurosceptic bent were best kept in the Cabinet tent rather than let loose outside it.
"I was one of the bastards, allegedly," Mr Lilley told BBC News Online earlier this year.
"It was one of those things that was said at the end of a long day and without realising that the microphone was still on. And it's certainly never caused any friction between him and me."
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