Former Europe minister David Davis and shadow defence secretary Iain Duncan Smith have both entered the race to become leader of the Conservative Party.

Mr Davis threw his hat into the ring just hours after Mr Duncan Smith made his official declaration.

We must enthuse the public with our vision and ideals

David Davis

The contest now is between the two right-wingers and Michael Portillo, although former chancellor Ken Clarke may yet to decide to run.

Currently Mr Portillo remains the favourite and has the support of a substantial number of the shadow cabinet.

Mr Davis is seen as an outsider with Mr Duncan Smith thought more likely to fight his way through to the next round of the contest - although that could all change if Mr Clarke joins the race.

The party has allowed itself to become caricatured by our opponents as a narrow sect

Iain Duncan Smith

At his news conference in central London Mr Duncan Smith - who is widely backed by the Thatcherite right - said that the Conservatives must preserve their principles while accepting the need for change.

He argued that they must develop a "broad appeal", adding: "The party has allowed itself to become caricatured by our opponents as a narrow sect."

Gay issue?

Questioned by journalists as to whether Mr Portillo's youthful homosexuality would be an issue, Mr Duncan Smith insisted his rival's past personal life would "play no part" in his campaign.

But he refused to criticise remarks by Lord (Norman) Tebbit, a backer of Mr Duncan Smith's campaign, praising the shadow defence secretary as a "normal family man".

Mr Duncan Smith said: "What Norman says is for Norman - it is nothing to do with me."

He said he wanted to unite the Conservatives promising that under a Duncan Smith-led Tory Party the front bench would be open to all talents, with those who wanted to campaign for the euro allowed to stand down temporarily from their positions during any future referendum campaign.

'Break the link'

David Davis: Euro a matter for a referendum

"This leadership contest is an opportunity to break the link with past mistakes without breaking faith with Conservative principles, whilst building on successes," he said.

The Tories needed to "shed the associations" of past failures and broaden their party's appeal.

He added: "My second objective is to close the book on divisions on Europe. The Conservative front bench must be open to all the talents."

Meanwhile, Mr Davis said he wanted to "enthuse the public with our vision and ideals".

"We will not offer a better way simply by aping Labour's approach in a Dutch auction of ever-higher spending promises," he said.

Euro issue

He branded Tory opposition to Labour's "tax and spend" agenda in the last parliament as "half-hearted".

And he vowed to maintain the party's opposition to the euro, though he warned against becoming obsessed with the issue.

"As the public made clear at the election, the euro is a unique issue that will ultimately be settled at a referendum," said Mr Davis.

Duncan Smith: Seeking all Tory talents

Of the potential contenders for the leadership, Mr Clarke - currently on business in Vietnam - is still considering whether to put his name forward.

If he does, he will be the only pro-single currency candidate running for the top job.

As such, he is likely to face a considerable hurdle in overcoming the deep Euroscepticism of most of the Conservative parliamentary party, which votes on which two leadership contenders' names make the final shortlist from which party members will choose the final victor.

Mr Clarke commands greater support among the Tory rank and file - which backed him during the 1997 leadership contest to choose a successor to John Major.

Tracked down by The Times newspaper in Ho Chi Minh City in Vietnam, Mr Clarke said: "The leadership contest is moving too quickly and nothing I have seen or heard, even in Vietnam, has convinced me otherwise."