Margaret Thatcher: Power and Personality (58 page)

The government reshuffle after the election was limited in scope. Apart from the exit of Francis Pym, the only departures from the senior ranks of the government had been David Howell and Janet Young.

The most remarkable promotion was Leon Brittan, who rocketed upwards from Chief Secretary to the Treasury to Home Secretary, replacing Willie Whitelaw. Having been a supremely loyal deputy to Margaret Thatcher, Whitelaw was hurt to lose his important job in the cabinet and to be booted upstairs to the more marginal post of Leader of the House of Lords. He went because the Prime Minister wanted a tougher Home Secretary, in tune with her own right-wing instincts on law and order.

Unfortunately, Leon Brittan never looked convincing in the role for which she had cast him. This became apparent a month after his appointment when the government allowed an early debate in the House on the re-introduction of capital punishment. Margaret Thatcher hoped that the large intake of new Tory MPs who favoured hanging would vote with her to restore it, at least for terrorist murderers and the killing of police officers. But Leon Brittan, who had changed his previous opposition to the death penalty, made an unimpressive speech as Home Secretary in favour of bringing back the noose. In a free vote, capital punishment was rejected by an unexpectedly large all-party majority of 145.
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Margaret Thatcher hated to be on the losing side. According to Jim Prior (an anti-hanger), she let her feelings show in the hurly burly immediately after the result was declared:

Her populist politics got the better of her. She shouted at Gerald Kaufman, Roy Hattersley and Peter Shore across the dispatch box that they didn’t know what the people wanted, and that on the council housing estates the Labour leadership would get stick for turning down hanging.
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It was an odd issue for a prime minister to become so passionate about, given the practical difficulties any government would face if executions had been restored.

Another parliamentary glitch when Margaret Thatcher’s wishes were not respected by the House of Commons despite her large majority concerned MPs’ pay. The Review Body on Top Salaries published its recommendation that gave Members an increase of 31 per cent. Margaret Thatcher rejected this and offered a rise of 4 per cent. She lost her battle to impose this figure.

The most serious ructions came from her back-benchers. After a row with Edward du Cann who, as chairman of the 1922 Committee, was acting as the Tory MPs’ shop steward, she gave way with bad grace, agreeing to a 22 per cent increase spread over the next four years. Thereafter, MPs’ pay would be linked to an identified pay grade level in the civil service. But on 20 July 1983, seventy Tories rebelled and by an eight-vote majority linked their pay to a higher grade.
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The Prime Minister was furious. The row grew bitter, with some MPs pointing out that Margaret Thatcher could afford to be austere about her own pay (she voluntarily did not take some £10,000 of the salary to which she was entitled) because she had a rich husband. The issue was badly handled, and opened the back door to the ‘padding’ of MPs’ allowances that eventually led to the MPs expenses scandal a generation later. At the time, it caused an avoidable rift between the Prime Minister and her parliamentary party.

More serious than any of these teething troubles was the discontent on the back benches about the government’s legislative programme. The Queen’s Speech had been a damp squib. The anodyne election manifesto had resulted in an unimpressive list of bills for the new Parliament to put on the statute book. The only fresh legislation of substance concerned the setting up of a Crown Prosecution Service and giving the go-ahead for cable television. This was hardly the radical fuel for the Thatcherite revolution that had been expected.

When those criticisms were voiced by six or seven back-benchers at a dinner organised just before the summer recess by the Prime Minister’s new Parliamentary Private Secretary, Michael Alison (Ian Gow had been made a Housing Minister), Margaret Thatcher gave an unexpected response. ‘You are right – the government is not doing enough’,
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she declared. It was an early example of her growing tendency to make a distinction between herself and the ministers
she had appointed. Those of us sitting around the table in the House of Commons dining room on this particular evening just before the summer recess were amused. We came away thinking that our leader wanted the government to develop a momentum for radical change, yet claimed she was being prevented from doing so against her will by the forces of inertia around her.

She was outspoken about the failings of some of her colleagues, notably her second choice (after Parkinson) for Foreign Secretary, Sir Geoffrey Howe. She said he had ‘already caught F.O.-itis’.
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After more in this vein, the Prime Minister left the dinner table with a memorable exit line: ‘We still need a revolution, but we have too few revolutionaries. Come on!’
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We back-benchers rose from our seats at this exhortation, but out of politeness rather than with passion to follow Boadicea to the barricades. This was a problem for her, to which she did not pay enough attention in the months and years ahead. Prime ministers who do not take their parliamentary supporters along with them on their crusades become more at risk than they realise.

DIFFICULT PROBLEMS

Margaret Thatcher was always several steps ahead of her party when it came to implementing an agenda of radical change. She was often obstructed by a combination of intractable problems and irresolute people. Another factor was that in domestic politics she was a cautious politician as often as she was a conviction politician. She kept her powder dry for the biggest issues.

Unemployment remained the toughest nut to crack. Early in her second term it peaked at 3.3 million. Neither the Prime Minister nor her Employment Secretary, Norman Tebbit, showed much sympathy for the plight of those on the dole. In a memorable party conference speech in 1981, with Margaret Thatcher applauding alongside him, Norman Tebbit told a tale of how his father had coped with unemployment in the 1930s. ‘He didn’t riot. He got on his bike, and looked for work.’
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This was the
Zeitgeist
of second-term Thatcherism.

After Norman Tebbit was promoted from Employment to the Department of Trade and Industry in October 1983, the Prime Minister became impatient with her new Employment Minister, Tom King. ‘There is a limit to how much tea and sympathy can be offered to the unemployed’,
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she said.

She turned to David Young, a successful businessman who, after two and a half years advising Keith Joseph, became Chairman of the Manpower Services Commission (MSC). In this role, Young began seeing a great deal of Margaret Thatcher. ‘David brings me solutions,’ she said, ‘others bring me problems.’
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The admiration was mutual. ‘I had a meeting with Margaret for half an hour at the beginning of every week’, Young recalled. ‘Without doubt, it was the most stimulating thirty minutes of my entire schedule. I would come away from my time with her walking on air. She was so resolute, so clear sighted in what she wanted to get done.’
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While David Young was Chairman of the MSC, he began to make the first big dent in the unemployment figures by introducing a wide range of work schemes and training projects, notably the Youth Training Scheme (YTS). When the general economy began picking up under Lawson’s ‘Budget for Jobs’ in 1985, the dole queues started to shrink, and the YTS eased the labour bottlenecks by providing a skilled workforce. Young was given a peerage, made Minister without Portfolio in the cabinet, and in 1985 promoted to Secretary of State for Employment. His rapid rise from outside the political system caused some jealousies among his fellow ministers.

Despite these mutterings, Margaret Thatcher liked promoting fellow revolutionaries from obscurity to stardom within her government. In addition to his initiatives for reducing unemployment, Lord Young was a major force in getting the privatisation of British Telecom accomplished. He also persuaded Margaret Thatcher and a majority of the cabinet to support the building of the Channel Tunnel. No wonder she liked him for bringing her solutions.

The most difficult problem on the Prime Minister’s desk was the reform of local government and of local government finance. She could never forget that in October 1974 she had promised, as Shadow Environment Secretary, to abolish the rates. Her determination to deliver this pledge became obstructed by a succession of ministers who either could not or would not find the means to the end the Prime Minister wanted.

After two major reviews by successive Secretaries of State for the Environment, Michael Heseltine and Tom King, all that had been produced was what Margaret Thatcher called, ‘the most modest of mice’.
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In her frustration with high-spending Labour-controlled local authorities, she took the radical step of abolishing the Greater London Council (GLC) and
six other Labour-controlled big city councils. This move had been announced in the 1983 Conservative election manifesto, and seemed to be accepted by the voters. However, the detailed legislation needed to accomplish abolition was a controversial mess. The impression of political vindictiveness and administrative incompetence was hyped up in a skilful campaign of propaganda led by Labour’s GLC leader, Ken Livingstone.

As the abolition legislation took a long time to pass, during which the profligate spending councils became even more profligate, the government had to introduce complex financial controls known as ‘rate capping’. The issues on the government’s side of the case were poorly presented, and Margaret Thatcher became frustrated that she was losing the argument on this part of her reform agenda. She sacked her Environment Secretary, Patrick Jenkin, replacing him with the more media-savvy Kenneth Baker, who had been no. 2 in the department as Local Government Minister.

Kenneth Baker and his junior minister, William Waldegrave, with extra help from Lord Rothschild, who had headed the Central Policy Review staff in the Heath government, were the original begetters of the Community Charge, later and better known as the ‘poll tax’. They unveiled their idea at a Chequers seminar in March 1985. The essence of the proposal was that domestic rates should be abolished and replaced with a new tax levied at a flat rate on all resident adults. Rebates would be available to those on low incomes, although even the poorest would have to pay something in order to maintain the principle of accountability.

At this Chequers seminar Margaret Thatcher gave the go-ahead to the Community Charge. She made this endorsement too quickly, and with uncharacteristic lack of attention to detail. She was so keen to get rid of the rates, to which she had a deep-seated aversion, that she abandoned her usual practice of testing a new policy idea by hammering out all its pros and cons in vigorous argument. Nevertheless, because she had given the Community Charge her early approval, she stuck to it with a fierce tenacity that ultimately proved to be her undoing.

One early sign that she might have made a mistake came from the Chancellor of the Exchequer, Nigel Lawson. He had not been present at the Chequers seminar. But he submitted a dissenting memorandum which presciently suggested that the new tax would simply be used by many Labour-controlled local
councils as a device for increasing spending and then blaming central government for the increased costs.

It was a great pity that the Prime Minister did not pay more heed to her Chancellor’s objections. For his star was rising, and he had become, after her, the most important figure in the government.

HER BLUE-EYED CHANCELLOR

Margaret Thatcher made a bold move at the beginning of her second term when she appointed Nigel Lawson to be Chancellor of the Exchequer. He was an unexpected choice, having been in the cabinet only twenty-one months, with a relatively low profile outside Whitehall. She admired him for his creative work as Financial Secretary to the Treasury, when he had pioneered both the lifting of exchange controls and the invention of the Medium Term Financial Strategy. She also noticed with approval his administrative skills as Energy Secretary, when he quietly succeeded in moving massive quantities of coal from the pits to the power stations – an achievement which facilitated the defeat of the miners’ strike in 1984. Above all, she thought Lawson’s combination of innovative ideas and right-wing radicalism was just what the management of the economy needed.

However, her admiration did not extend to matters of personal presentation. After appointing him Chancellor, her first advice to him in the same conversation was that he should get his hair cut. He obeyed, but was not always to prove so compliant with her commands.

Margaret Thatcher’s relationship with Nigel Lawson was quite different to her handling of her first Chancellor, Geoffrey Howe, who she had shifted sideways to the post of Foreign Secretary. She saw Howe as a cautious, plodding decision-maker whose understanding of economics was inferior to her own. By contrast, she thought Lawson was an intellectually brilliant economist who understood the Treasury inside out.

‘I had by now come to share Nigel’s high opinion of himself’,
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was her barbed explanation for promoting him over the heads of other contenders. As the comment indicates, she sensed that Lawson was unlikely to be unduly subservient towards the First Lord of the Treasury, a stance which was acceptable to her during their honeymoon period after his appointment, but which eventually led to friction and conflict.

Besides admiring Nigel Lawson’s talent, Margaret Thatcher liked his buccaneering approach to problem solving and the speed of his decision taking. She had an early taste of this three weeks after he started at the Treasury and discovered that public borrowing was overshooting by £3 billion a year. Courageously, Lawson proposed an immediate package of asset sales and expenditure cuts which he and the Prime Minister steered through a hesitant cabinet on 7 July. His axe fell most sharply on the Defence budget and the NHS budget, which between them yielded up £500 million.