The Downing Street Years (130 page)

I decided that two ministers should leave the Cabinet altogether. Paul Channon was loyal and likeable. But Transport was becoming a very important department in which public presentation was at a premium — what with the appalling disasters which seemed to plague us at this time and in the light of the traffic congestion which Britain’s new prosperity brought with it. I asked Paul to leave and he did so with perfect good humour. I appointed Cecil Parkinson to his place. Deciding to ask John Moore to go was even more of a wrench. He was of my way of thinking. At Health it was he — rather than his successor Ken Clarke — who had really got the Health review under way. At Social Security, after I split the DHSS into two departments, he had been courageous and radical in his thinking about dependency and poverty. But, as I have explained, John had never fully recovered, at least psychologically, from the debilitating illness he suffered while Secretary of State at the old combined DHSS. So I asked him to make way and appointed Tony Newton, a stolid, left-inclining figure but one with a good command of the House and of his brief. I also brought into the Cabinet Peter Brooke who had been a much loved and utterly dependable Party Chairman. He wanted to be Ulster Secretary and I gave him the job, moving Tom King to the Defence Ministry, vacated by George Younger who wanted to leave the Government to concentrate on his business interests. George’s departure was something of a blow. I valued his common sense, trusted his judgement and relied on his loyalty. His career is proof of the fact that, contrary to myth, gentlemen still have a place in politics.

But there were three main changes which determined the shape of the reshuffle and the reception it received. In reverse order of importance: I moved Chris Patten to the Environment Department to succeed Nick Ridley, who went to the DTI (David Young left the Cabinet at his request and became Deputy Chairman of the Party); I moved Ken Baker to become Party Chairman from the Department of Education, where he was succeeded by John MacGregor. And John was
succeeded by John Gummer who entered the Cabinet as Minister for Agriculture.

But first, and crucially, I called in Geoffrey Howe and said that I wanted him to leave the Foreign Office, where I intended to put John Major. It was predictable that Geoffrey would be displeased. He had come to enjoy the trappings of his office and his two houses, in Carlton Gardens in London and Chevening in Kent. I offered him the Leadership of the House of Commons at a time when the House was shortly to be televised for the first time. It was a big job and I hoped he would recognize the fact. But he just looked rather sullen and said that he would have to talk to Elspeth first. This, of course, held up the whole process. I could see no other ministers until this matter was decided. Geoffrey also, I believe, saw David Waddington, the Chief Whip, who had advised me to keep Geoffrey in the Cabinet in some capacity. David meant well by this advice, but perhaps I should have asked Geoffrey to go altogether, for he clearly never forgave me. Back and forth to Downing Street messages passed in the course of which I offered Geoffrey the Home Office — knowing in advance that he would almost certainly not accept — then, after conferring with Nigel Lawson, Dorneywood, the Chancellor’s country house which I rightly thought that he would accept, and finally, with some reluctance and at his insistence, the title of Deputy Prime Minister which I had held in reserve as a final sweetener. This is a title with no constitutional significance but which Willie Whitelaw (until his stroke in December 1987 and subsequent resignation the following month) had almost made his own because of his stature and seniority. But because Geoffrey had bargained for the job, it never conferred the status which he hoped. In practical terms it just meant that Geoffrey sat on my immediate left at Cabinet meetings — a position he may well have come to regret.

The delay in concluding the reshuffle was bound to prompt speculation. But it was, I am told, Geoffrey’s partisans who leaked the content of our discussions in a singularly inept attempt to damage me. As a result he received a very bad press about the houses, which was not unmerited, but which he doubtless blamed on me.

John Major was not at first very keen on becoming Foreign Secretary. A modest man, aware of his inexperience, he would probably have preferred a less grand appointment. But I knew that if he was to have a hope of becoming Party leader, it would be better if he had held one of the three great offices of state. I should add that I had not, contrary to much speculation, reached a firm decision that John was my preferred successor. I had simply concluded that he must be
given wider public recognition and greater experience if he was to compete with the talented self-publicists who would be among his rivals. Unfortunately, because of Nigel Lawson’s resignation, he had no opportunity to show what he was made of at the Foreign Office before returning to the Treasury.

In moving Nick Ridley to the DTI I was generally seen to be responding to the criticisms of him by the environmental lobby. This was not so. I knew he wanted a change. I was, of course, quite aware of the fact that the romantics and cranks of the movement did not like it when he insisted on basing policy on science rather than prejudice. I also suspected that from Chris Patten they would get a more emollient approach. Certainly, I subsequently found myself repeatedly at odds with Chris, for with him presentation on environmental matters always seemed to be at the expense of substance. But I also wanted Nick in the second most important economic department because of the need to have his support on the key issues of industry and Europe.

Ken Baker’s appointment as Party Chairman was an attempt to improve the Government’s presentation. Ken — like Chris Patten — had started off on the left of the Party. But unlike Chris, Ken had genuinely moved to the centre. In any case his great skills were in publicity. And I never forgot that for every few Thatchers, Josephs and Ridleys you need at least one Ken Baker to concentrate on communicating the message. I was also happy now to appoint John MacGregor with his Scottish devotion to Education as the right person to deal with the nuts and bolts of making our education reforms work. My appointment of Ken Baker to the chairmanship was a success. He served me with vigour and enthusiasm right to the end, however hot the political kitchen became. We had never been close political allies, so I was doubly indebted to him for this.

The immediate impact of the reshuffle was much worse than I had expected because of the stories of what Geoffrey had or had not been offered and demanded. Once the initial reaction had passed, it was clear that we benefited from the new look the Government had acquired. More seriously, though, Geoffrey was still well placed to make trouble for me and the balance of the Cabinet had slipped slightly further to the left with the promotion of Chris Patten and John Gummer and the departure of John Moore more than compensating for the arrival of Norman Lamont, who was on the right. Of course, none of this mattered as long as crises which threatened my authority could be avoided.

In fact they came not in single spies but in battalions. The winter of 1989 saw those revolutionary changes which led to the collapse of communism in eastern Europe. In the longer term the emergence of free, independent and anti-socialist governments in the region would provide me with potential allies in my crusade for a wider, looser Europe. But the immediate effect, through the prospect and then the reality of German reunification, was to strengthen the hand of Chancellor Kohl and fuel the desire of President Mitterrand and M. Delors for a federal Europe which would ‘bind in’ the new Germany to a structure within which its preponderance would be checked. Although these matters are best dealt with later in the context of East-West relations, they formed the background to the ever more intense battles on monetary and political union in which I henceforth found myself engaged.

After Spain the European Community presidency passed to France. Partly in order to ensure that eastern Europe did not dominate the European Council scheduled for December at Strasbourg, President Mitterrand called a special Council in November in Paris specifically to discuss the consequences of events in the East and the fall of the Berlin Wall. He was also pressing hard for the creation of a European Bank of Reconstruction and Development (EBRD) in order to channel investment and assistance to the emerging democracies. I was sceptical about whether such an institution was really necessary. The case had not been made that aid of this dimension had to go through a European institution, as opposed to national or wider international ones. I conceded the point in Strasbourg; but my wishes were eventually met because the EBRD now sensibly involves the Americans and Japanese, not just the Europeans. President Mitterrand and I finally put together a deal in 1990: I agreed that his protégé Jacques Attali would be EBRD President and he agreed that the bank would be situated in London.

To some extent the French strategy of holding an ‘unofficial’ Paris Council on East-West relations worked because the Strasbourg Council concentrated — at least in its official sessions — heavily on the more narrowly European matters of EMU and the Social Charter. I was as strongly opposed to the holding of an IGC on economic and monetary union as ever. Equally, I had little hope of blocking it altogether. The
French aim was to set a date for the IGC and this I still hoped to stave off. Until a few days before the start of the Council we were optimistic that the Germans would support us in calling for ‘further preparation’ before the IGC met. But in a classic demonstration of the way in which the Franco-German axis always seemed to re-form in time to dominate the proceedings, Chancellor Kohl went along with President Mitterrand’s wishes. By the time I arrived in Strasbourg I knew that I would be more or less on my own. I decided to be sweetly reasonable throughout, since there was no point in causing gratuitous offence when I could not secure what I really wanted. It was agreed that the IGC would meet under the Italian presidency before the end of 1990, but after the German elections. As for the Social Charter at which I had directed my fire at Madrid, I reaffirmed that I was not prepared to endorse the text, my determination having been if anything strengthened by the fact that the Commission was now proposing to bring forward no fewer than forty-three separate proposals, including seventeen legally binding directives, in the areas which the charter covered. That effectively ended the discussion of the charter from our point of view. On EMU I would return to the fray in Rome.

In the first half of 1990, however, there was the Irish presidency to contend with. The unwelcome habit of calling extra ‘informal’ Councils proved catching. Charles Haughey decided that another one was needed in order to consider events in eastern Europe and the implications for the Community of German unification. Perhaps that is what Mr Haughey really envisaged, but for others this was just an opportunity to keep up the federalist momentum.

‘Political union’ was now envisaged alongside ‘monetary union’. In a sense, of course, this was only logical. A single currency and a single economic policy ultimately imply a single government. But behind the concept of ‘political union’ there lay a special Franco-German agenda. The French wanted to curb German power. To this end, they envisaged a stronger European Council with more majority voting: but they did not want to see the powers of the Commission or the European Parliament increased. The French were federalists on grounds of tactics rather than conviction. The Germans wanted ‘political union’ for different reasons and by different means. For them it was partly the price of achieving quick reunification with East Germany on their own terms and with all the benefits which would come from Community membership, partly a demonstration that the new Germany would not behave like the old Germany from Bismarck to Hitler. In this cause, the Germans were prepared to see more powers for the Commission
and they gave special importance to increasing the power and authority of the European Parliament. So the Germans were federalists by conviction. The French pushed harder for political union: but it was the agenda of the Germans, who were increasingly the senior partner of the Franco-German axis, which was dominant.

For my part I was opposed to political union of either kind. But the only way that I could hope to stop it was by getting away from the standard Community approach whereby a combination of high-flown statements of principle and various procedural devices prevented substantive discussion of what was at stake until it was too late. Within the Community I must aim to open up the divisions between the French and the Germans. At home I must point out in striking language just what ‘political union’ would and would not mean if it was taken at all seriously. Far too much of the Community’s history had consisted of including nebulous phrases in treaties and communiqués, then later clothing them with federal meaning which we had been assured they never possessed. Consequently, I decided that I would go to Dublin with a speech which would set out what political union was not and should never be. This seemed the best way of having all concerned define — and disagree about — what it was.

There was no doubt about how determined the French and Germans were in their federalist intentions. Shortly before the Council met in Dublin at the end of April President Mitterrand and Chancellor Kohl issued a joint public statement calling for the Dublin Council to ‘initiate preparations for an Inter-Governmental Conference on political union’. They also called on the Community to ‘define and implement a common foreign and security policy’. President Mitterrand and Chancellor Kohl chose at about the same time to send a joint letter to the President of Lithuania urging temporary suspension of that country’s declaration of independence in order to ease the way for talks with Moscow. As I took some pleasure in pointing out in my subsequent speech at the Council, this was done without any consultation with the rest of the Community, let alone NATO — it demonstrated that the likelihood of a common ‘foreign and security policy’ was somewhat remote.