Delegates at the Conservative Party's conference Thursday jeered Prime Minister Margaret Thatcher's ousted predecessor Edward Heath when he attacked her opposition to closer union among European Economic Community nations. Others applauded Heath when he hailed the scheduled dismantling in 1992 of all trade barriers within the EEC as a ``major movement toward the unity of Europe in every way.'' Mrs. Thatcher, to whom the 4,500 delegates sang ``Happy Birthday'' _ she turned 63 _ left the conference center to return to her hotel before the intervention by Heath. They have been on bad terms since she ousted him as party leader in 1975 after he lost two successive elections. Aides said she wanted to work on her keynote address to the final session of the four-day convention Friday. Earlier, treasury chief Nigel Lawson, the chancellor of the exchequer, promised more tax cuts ``when prudent'' and forecast a drop next year in inflation, now 5.7 percent and rising. But in his address to the convention in this south England resort he warned that interest rates, now at 12 percent, would remain high for ``quite a while.'' Heath, prime minister when Britain joined the EEC in 1973, said the rest of the 12-nation trade bloc would not tolerate Britain treating the post-1992 single market merely as a ``free trade area.'' ``It is a major movement toward the unity of Europe in every way,'' said Heath. ``It also concerns a common currency with a common monetary system and a common bank.'' Several dozen delegates raised small replicas of the Union Jack and waved notices declaring, ``No to Ted.'' In a policy speech last month in Bruges, Belgium, Mrs. Thatcher rejected a common European currency, bank or monetary system and said a United States of Europe would never come about. She criticized what she called the bureacracy at the EEC headquarters in Brussels. Foreign Secretary Sir Geoffrey Howe defended Mrs. Thatcher's rejection of what she regards as unrealistic talk of a united Europe. He said she was as much a European as French President Francois Mitterrand or West German Chancellor Helmut Kohl, leaders of the two other biggest financial contributors to the EEC. On East-West relations, Howe said the West should not assume that Soviet President Mikhail S. Gorbachev's desire for reform was ``shared throughout the Soviet command structure.'' ``The Red Army and the KGB still loom in force,'' he said. ``That's why the West must go on negotiating (arms cuts) from strength.''