Davis prepares to fight Rifkind

The "phantom" battle for the Tory leadership continued apace today as both David Davis and Sir Malcolm Rifkind began to build support.

The two men's status as early frontrunners was confirmed when MPs from different wings of the party suggested both would be best placed to succeed Michael Howard.

Mr Davis, the bookmakers' favourite, was being touted as the "unity candidate" after a leading ally of Kenneth Clarke said the shadow home secretary could win substantial support if he endorsed a centrist agenda. But Sir Malcolm, a former foreign secretary, appeared to be winning backing from key modernisers such as Oliver Letwin, David Cameron and George Osborne.

Shadow environment secretary Tim Yeo today quit the shadow cabinet in order to speak freely about the need for a modernising agenda.

Mr Yeo, who has been seen as leadership contender himself, said he wanted to use the period before any leadership contest to focus the debate on policies over personalities.

Other leading modernisers - including David Willetts, Damian Green and Francis Maude - called for the party to recognise that a fundamental policy rethink was needed instead of "one more heave" for power.

The Davis camp has been studiously disciplined in recent days as their man does not want to be seen to be exploiting the possible chaos caused by Mr Howard's announcement. But they were today delighted by the endorsement of Ian Taylor, one of Mr Clarke's closest allies and a leading pro-European.

Mr Taylor said: "David is a real politician. If he reaches out and can convince onenation Conservatives, then maybe he's got a chance."

The Right of the party is furious at suggestions that members could be stripped of their power to decide their leader.

William Hague, the man who put in place the current system of choosing a leader, said it was time to change the rules that allow a leader to be chosen even if he lacks the backing of a majority of MPs.

But Right-wingers, furious at Mr Howard's expulsion of Howard Flight on the eve of the election, believe local associations will be reluctant to give up their say over who the leader should be.