Tory leaders bury the hatchet. Thatcher and party chief move to patch up their differences

Before heading for her August vacation, British Prime Minister Margaret Thatcher made it clear that she was determined to ensure that her ruling Conservative Party fights the next general election with a united leadership. She moved to close the breach between herself and the party chairman, Norman Tebbit. Less than a year ago such a move would have been unnecessary. Mrs. Thatcher and Mr. Tebbit were on the same wavelength as radical, right wing Tories, committed to monetarism and to dismantling state and trade union power. Tebbit was widely regarded as Thatcher's natural successor for the Tory leadership. But in recent months their relationship has been under increasing strain.

The Tory chairman's main job is to give the party confident leadership at the constituency level and to ensure that policies are in tune with the political mood of the country. Tebbit, a tireless worker and fluent, if acerbic, orator seemed well-suited to the task -- and Thatcher seemed happy with him. But at the beginning of this year problems began to arise:

The Tories continued to lose important by-elections, sometimes running third after Labour and the Social Democratic-Liberal Alliance.

Public opinion polls showed the Tories dragging badly behind their opponents.

Thatcher and Tebbit began drifting apart on important policy issues.

In part, the difficulties between the two could be explained by the fact that the second Thatcher government was at midterm -- a notoriously hard time to project an image of unity and confidence. But senior party figures noted deeper sources of worry.

When a crisis blew up this year over the financial future of Westland helicopters, Tebbit appeared to distance himself from the Prime Minister as two senior cabinet members resigned.

Later, when American automaker General Motors attempted to take over the Land-Rover Company, the party chairman was said to offer little support to Thatcher.

And when Thatcher threw her support behind President Ronald Reagan over the bombing of Libya last April, Tebbit made it clear that he thought her policy was wrong.

These three issues helped to pull the two leaders apart. But it was Tebbit's management of Tory party publicity that set up the greatest strains of all.

Thatcher told the party chairman that she had been impressed by the marketing approach of the American advertising agency Young and Rubicam. But Tebbit insisted that the British-based Saatchi and Saatchi -- the agency that helped the Tories win the 1983 election by a landslide -- should keep the account. Their differences on this question stimulated reports that Tebbit was about to resign his chairman's post.

Disturbed by such reports, senior Tory figures urged the two leaders to settle their differences. They reminded them that a general election must be held by 1988 at the latest, and that the party's disarray at the top was helping to depress its fortunes at by-elections and in the opinion polls.

So soon after Parliament rose for its August break, Thatcher made a highly-publicized telephone call to Tebbit. Afterwards, her officials declared that there was total unity between 10 Downing Street and Tory party headquarters.

Thatcher's Labour and Alliance opponents responded with charges that the healing process between the two was only cosmetic. They pointed out that Tebbit had been under heavy physical and psychological strain ever since he received severe injuries in 1984, when terrorists bombed the Brighton hotel where the Tories were holding their annual conference.

Tory party officials privately concede that this may have been a factor in the awkward relationship between Thatcher and Tebbit. But they insist that the difficulties are over, and that the two are determined to work together for a Tory political victory. But Tebbit, significantly, is no longer seen in the upper levels of the Tory party as Thatcher's most likely successor.