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British finance chief out in Cabinet shuffle


LONDON -- Prime Minister John Major shuffled his Cabinet yesterday, patted his widely disliked finance minister, Norman Lamont, on the back for reducing inflation and then dumped him out of the government.

He replaced him as chancellor of the exchequer with Kenneth Clarke, the home secretary, one of the Cabinet's most pro-Europe members.

Mr. Lamont has grown increasingly unpopular in the months since the Conservatives won a fourth five-year term in general elections in April 1992. He presided over an economy strangled by rising unemployment, falling productivity, stratospheric interest rates, record bankruptcies and an alarming proliferation of mortgage foreclosures.

He was in charge of the treasury last Sept. 16, known here as Black Wednesday, when the pound sterling, under siege by currency speculators, was forced to withdraw from Europe's Exchange Rate Mechanism. It was subsequently devalued by about 16 percent.

This was preceded by his, and Mr. Major's, increasingly frequent promises that devaluation was not going to happen.

Since then, Mr. Lamont has been without credibility within the financial community in this country. And though the economy has begun to pick up in recent weeks, his reputation has remained flat on the floor. A recent poll of economists by the Reuters agency revealed that 75 percent favored his resignation.

Mr. Lamont will be taking no other Cabinet position, though it was said he was offered one but turned it down. His meeting with Mr. Major yesterday was reportedly an unfriendly one.

Mr. Lamont's departure is being interpreted as the prime minister's way of responding to the profound disaffection with the Conservative Party evident in its sweeping losses in local council elections all across the country this month, and the loss as well in a parliamentary by-election in the constituency at Newbury, once thought an unassailable Conservative seat.

For those in the government who might have missed the message of the elections, a Gallup Poll revealed yesterday that most of those queried regarded Mr. Major's government as concerned only for themselves and their party, ineffective, short-sighted, incompetent and failing to inspire confidence.

Though Mr. Lamont had enemies all across the political spectrum, he may be sorely missed by the more conservative legislators in his party. They always have regarded Mr. Clarke with suspicion for his affection for policies that would move Britain closer to the European Community.

Other changes made by Mr. Major: Michael Howard, environment secretary, will replace Mr. Clarke at the Home Office; Gillian Shephard, employment secretary, will be the new minister of agriculture; John Gummer, currently in that post, will be environment secretary; David Hunt, Welsh secretary, will become employment secretary; and John Redwood, currently the local government minister, will be moved up into the Cabinet and become Welsh secretary.

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