Britain's Conservatives Move to Beat Back Labour Gains

WITH another crushing by-election victory to its credit, Britain's opposition Labour Party has launched a long-range strategy to hold the political initiative until the ruling Conservatives are forced to call a general election. But within 24 hours of Neil Kinnock, the Labour leader, telling a conference of party stalwarts in Wales last Friday that the government was "rattled" and "out of touch with the people," Prime Minister John Major struck back with a determined counteroffensive.

In a speech to a private meeting of party members in Lincolnshire on Saturday, which Conservative officials said signaled an important switch of approach, Mr. Major claimed that with inflation having just fallen last week to 6.4 percent, the government was getting a grip on the ailing British economy.

He went on to argue that reforms of the National Health Service (NHS), aimed at loosening the public service grip on hospitals and edging them toward the private sector, would benefit all of Britain's 35 million voters by making health care more efficient.

He vigorously rebutted Labour claims that the government planned to allow hospitals throughout Britain to opt out of the NHS and become privately owned.

Since he took over as prime minister from Margaret Thatcher seven months ago, Major has been hoping that falling rates of inflation would help to put the economy back on an even keel. Only a couple of weeks ago, senior Conservative officials were saying Major was confident that a "feel-good factor" would begin working to the government's advantage well before the end of the year.

Now, however, the mood at Conservative Central Office has changed. Chris Patten, the party chairman, is said to have warned Major that, against the background of a deep recession, the government had to do more than wait for better days: It had to go onto the attack.

The weekend attempt by Major to pump new vigor into his party with a pugnacious speech was welcomed by political supporters worried about Mr. Kinnock's success in fostering the impression that after 12 years in power the government has run out of energy and ideas.

In an electoral contest in Wales last Thursday, the opposition candidate turned a Conservative majority of 9,000 into a Labour win by more than 2,500 votes. The Monmouth result gave Kinnock a hook on which to hang renewed Labour demands that the prime minister should resign, call a general election, and let the people decide.

UNDERLYING the Labour leader's energetic efforts to retain the initiative in the political struggle are his fears that falling inflation and anticipated cuts in interest levels will eventually undermine his claims that the economic recession is out of control.

The Kinnock strategy, urged on him by John Cunningham, the party's campaign coordinator, and John Underwood, head of communications, includes broadening the attack on the government by exploiting sensitive social themes in coming months.

Among such themes, the future of the NHS looks as though it will become an issue that could help to decide the general election that Major must call no later than mid-1992. An opinion poll last weekend showed that concern about the NHS had displaced dislike of the poll tax as a top political issue for voters.

The poll also showed Labour running four points ahead of the Conservatives.

In the Monmouth contest, Labour provoked Conservative wrath by claiming that the government's policy of allowing public hospitals to be run by self-governing trusts amounted to an attempt to wreck the NHS.

The health issue is ultra-sensitive. The NHS has been in existence for more than 40 years and is seen by large numbers of voters as an essential part of the British welfare scene.

Anthony Howard, a leading independent political commentator, believes the prime minister must soon make a decision about when a general election should be held.

"From his standpoint, he has to be seen as cool and decisive. He must either decide to go to the country in the fall, or firmly rule out a general election until next year," Howard said. "What he can't afford to do is leave the question open for much longer."