The Downing Street Years

by Margaret Thatcher

  In the past our people have made sacrifices, only to find at the eleventh hour their government had lost its nerve and the sacrifice had been in vain. It shall not be in vain this time. This Conservative Government, not yet two years in office, will hold fast until the future of our country is assured. I do not greatly care what people say about me: I do greatly care what people think about our country. Let us, then, keep calm and strong, and let us preserve that mutual friendship in which patriotism consists. This is the road I am resolved to follow. This is the path I must go. I ask all who have the spirit — the bold, the steadfast and the young in heart — to stand and join with me as we go forward. For there is no other company in which I would travel.

  I got a good reception. For the moment at least, the Party faithful were prepared to take the heat and to back the Government. But that determination might erode over the summer unless the Government stuck together.

  THE COAL STRIKE WHICH NEVER WAS

  Thankfully, strikes occupied far less of our time during 1981 than they had in 1980, and the number of working days lost due to strike action was only a third of that in the previous year. But two disputes — one in the coal industry, which did not in the end result in a strike, and another in the civil service, which did* — were of great importance, both to budget decisions and to the overall political climate.

  A foreigner unaware of the extraordinary legacy of state socialism in Britain would probably have found the threatened miners’ strike in January 1981 quite incomprehensible: £2.5 billion of taxpayers’ money had been invested in the coal industry since 1974; productivity at some of the new pits was high, and a slimmed-down and competitive coal industry could have provided employees with good, well-paid jobs. But this was possible only if uneconomic pits were closed, which the National Coal Board (NCB) wished to do. Moreover, the pits which the NCB was intent on closing in a programme it put forward in early 1981 were not just uneconomic but more or less exhausted. On 27 January the Energy Secretary, David Howell, told me about the closure plans. The following afternoon Sir Derek Ezra, NCB Chairman, visited Downing Street and briefed me in person. I agreed with him that with coal stocks piling up and the recession continuing there was no alternative to speeding up the closure of uneconomic pits. I had long regretted that past governments had made such an enormous commitment to coal: if we had spent more on nuclear power, as the French had done, our electricity would have been cheaper — and, indeed, our supplies more secure.

  As in the cases of BSC and BL, it was the management which had to implement the agreed approach and, inevitably, the Government found itself dragged into a crisis we had neither sought nor predicted. The press was soon full of NCB plans to close 50 pits and a bitter conflict was predicted. The National Union of Mineworkers (NUM) was pledged to fight closures and although Joe Gormley, its President, was a moderate, the powerful left-wing faction of the union was bound to exploit the situation and it was well known that Arthur Scargill, the hard-left leader, was likely to succeed Mr Gormley as President in the near future.

  At a meeting with the NUM on 11 February the NCB Board resisted pressure to publish a list of pits which it was proposing to close and denied the figure of 50. However, the Board failed to mention the idea of improved redundancy terms, which was already being discussed by the Government, and instead undertook to join the NUM in an approach to us seeking a lower level of coal imports, the maintenance of a high level of public investment and subsidies comparable to those allegedly being paid by other governments to coal industries abroad. Far from acting as management might be expected to do, the NCB Board was behaving as if it entirely shared the interests of the union representing its employees. The situation quickly deteriorated further. I was lucky to have a private, independent and knowledgeable source of advice in my press secretary, Bernard Ingham who, before working for me in Downing Street, had spent some years in the Department of Energy and was convinced from the start that the department was far too complacent about the threat posed by a strike.

  On Monday 16 February I had a meeting with David Howell and others. Their tone had entirely changed. The department had suddenly been forced to look over the abyss and had recoiled. The objective had now become to avoid an all-out national strike at the minimum cost in concessions. David Howell would have to agree to a tripartite meeting with the NUM and the NCB to achieve this. The tone of the NCB Chairman had also changed in short order. I was appalled to find that we had inadvertently entered into a battle which we could not win. There had been no forward thinking in the Department of Energy about what would happen in the case of a strike. The coal stocks piled at the pit heads were largely irrelevant to the question of whether the country could endure a strike: it was the stocks at the power stations which were important, and these were simply not sufficient. I had by now even less confidence in the NCB management. It became very clear that all we could do was to cut our losses and live to fight another day, when — with adequate preparation — we might be in a position to win. When my attitude became clear one official could not prevent himself expressing disappointment and surprise. My reply was simple: there is no point in embarking on a battle unless you are reasonably confident you can win. Defeat in a coal strike would have been disastrous.

  The tripartite meeting was due to take place on 23 February. In the interim, we were hoping that the NCB would be able to make a more effective presentation of their case and to prevent the NUM continuing to make all the running. Indeed, we were advised that unless we held the tripartite meeting earlier than planned the NUM Executive might vote for a strike ballot. On the morning of 18 February I met hurriedly with David Howell to agree on the concessions which would have to be offered to stave off a strike. There was still considerable confusion as to what the facts really were. Whereas the NCB had been reported to be seeking 50 or 60 pit closures, it now appeared that they were talking about 23. But the tripartite meeting achieved its immediate objective: the strike was averted. The Government undertook to reduce imports of coal to the irreducible minimum, with David Howell indicating that we were prepared to discuss the financial implications with an open mind. Sir Derek Ezra said that in the light of this undertaking to review the financial constraints under which the NCB was operating, the Board would withdraw its closure proposals and re-examine the position in consultation with the unions.

  The following day David Howell made a statement to the Commons to explain the outcome of the meeting. The press reaction was that the miners had won a major victory at the expense of the Government, but that we had probably been right to surrender. This was not, however, the end of our difficulties. We agreed to improve the redundancy terms for coal miners, to finance a scheme for conversion from oil to coal in industry and to look again at NCB finances. As is always the case once corporatism takes a grip, it became extremely difficult to bring the tripartite discussions to an end without provoking a crisis and equally difficult to ensure that the whole question of government finance for the NCB did not come onto the agenda. It had already emerged at the tripartite meeting on 25 February that the NCB was in far deeper financial trouble than we had known. They were likely to overrun their external financing limit (EFL), which had already been set at some £800 million, by between £450 and £500 million and were expecting to make a loss of £350 million. We would need to challenge these figures and examine them in detail, but we could not do this — as the NCB Board undoubtedly realized — when the NUM knew almost as much about the NCB’s financial position as we did. Therefore, our aim must be to draw a ring fence around the coal industry by arguing that coal was a special case rather than a precedent. We must seek to avoid any commitment for the years beyond 1981–2. Above all, we must prepare contingency plans in case the NUM sought a confrontation in the next pay round.

  We confirmed these decisions at a meeting of ministers on 5 March. David Howell skilfully handled the next tripartite meeting on 11 March, at which it was understood that we would not need another tripartite
meeting until the NCB’s financial position had been resolved. Meanwhile, he had been instructed to prepare a memorandum on contingency plans and circulate it by Easter.

  Having managed to ease the Government out of an impossible position — at what I knew to be a high political cost — I concentrated attention on limiting the financial consequences of our retreat and preparing the ground so that we would never be put in such an awful situation again. David Howell had been shaken by what had happened. He feared a repetition of the events of January. There was much argument between him and the Treasury about the new EFL for the NCB and the level of investment we ought to finance. We had to agree to an EFL of well over £1 billion. Similarly, the threat of strike action constrained what we could do immediately to increase our capacity to endure a future strike. It was clear that coal stocks at the power stations must be increased, but it was impossible to take this action without its becoming known, and the faster stocks were transferred the more visible it would be. Jim Prior advised that we should not even discuss the matter with the industries involved, on the ground that it would be provocative to do so. The Department of Energy was very slow in giving effect to the decision that 4–5 million tons should be moved by the time that the NUM pay negotiations took place in the autumn. We were told that the Central Electricity Generating Board (CEGB) would probably have to acquire extra land if higher stocks than this were to be built up. I held a meeting on 19 June to review the position. It seemed to me that the risks of moving coal stocks had been exaggerated. After all, stocks at the pits had increased from 13 million to 22 million tons over the past 12 months and it was natural that there should be some extra movement.

  The real question in my mind was whether — even if we could substantially increase the rate of movement of coal to the power stations — we would in practice be able to resist a strike that winter. It was evident from the NUM Conference which took place in Jersey in July that the left wing of the union had become obsessed with the idea of taking on the Government and that Arthur Scargill, by this stage certain of the presidency, would make this his policy. Willie Whitelaw, as Home Secretary the minister in overall charge of civil contingency planning, had overseen a study of how to withstand a coal strike that winter. He sent me a report on 22 July, which concluded that a strike this year probably could not be withstood for more than 13–14 weeks. The calculations took account of the transfer of coal stocks which we had put in hand. In theory, endurance could be increased by power cuts or the use of troops to move coal to the power stations. But either option was fraught with difficulty. There would be huge political pressure to give in to a strike. The union might see what was up if we set about increasing oil stocks for power stations. In August I reluctantly concluded that no such action should be taken in advance of that year’s NUM pay settlement. We would have to rely on a judicious mixture of flexibility and bluff until the Government was in a position to face down the challenge posed to the economy, and indeed potentially to the rule of law, by the combined force of monopoly and union power in the coal industry.

  THE URBAN RIOTS OF 1981

  Over the weekend of 10–12 April, riots broke out in Brixton, South London. Shops were looted, vehicles destroyed, and 149 police officers and 58 members of the public were injured. Two hundred and fifteen people were arrested. There were frightening scenes, reminiscent of riots in the United States during the 1960s and ‘70s. I accepted Willie Whitelaw’s suggestion that Lord Scarman, the distinguished Law Lord, should undertake an enquiry into the causes of what had happened and make recommendations.

  There was a lull; then on Friday 3 July a battle in Southall between white skinheads and Asian youths erupted into a riot in which the police quickly became the main victims, attacked with petrol bombs, bricks and anything else to hand. The mob even turned on firemen and ambulancemen. Over the weekend, Toxteth in Liverpool was also the scene of violence: once again there were outbreaks of arson, looting and savage attacks on the police. The Merseyside police reacted vigorously and dispersed the mob with CS gas.

  On 8 and 9 July it was the turn of Moss Side in Manchester to experience two days of serious disorder. The police presence was initially kept deliberately low, in the hope that ‘community leaders’ could calm matters down. This they singularly failed to do and so the police had to move into the area in strength. Willie Whitelaw told me after his visits to Manchester and Liverpool that the Moss Side riots had taken the form of looting and hooliganism rather than direct confrontation with the police. In Liverpool, as I was to learn, racial tension and bitter hostility to the police — in my view encouraged by left-wing extremists — were more important.

  The riots were, of course, a godsend to the Labour Opposition and the Government’s critics in general. Here was the long-awaited evidence that our economic policy was causing social breakdown and violence. In the Commons and elsewhere I found myself countering the argument that the riots had been caused by unemployment. Behind their hands, some Conservatives echoed this criticism, complaining that the social fabric was being torn apart by the doctrinaire monetarism we had espoused. This rather overlooked the fact that riots, football hooliganism and crime generally had been on the increase since the 1960s, most of that time under the very economic policies that our critics were urging us to adopt. A third explanation — that racial minorities were reacting to police brutality and racial discrimination — we took more seriously. Indeed, it was for this reason that we had invited Lord Scarman to investigate and report on the causes of the riots immediately after the Brixton riots in April. Following his report we introduced a statutory framework for consultation between the police and local authorities, tightened the rules on stopping and searching suspects, and brought in other measures relating to police recruitment, training and discipline.

  Whatever Lord Scarman might recommend, however — and whatever Michael Heseltine might achieve later by skilful public relations when he had begun to investigate the problems of Merseyside — the immediate requirement was that law and order should be restored. I told Willie on Saturday 11 July that I intended to go to Scotland Yard and wished to be shown how they handled the difficulties on the ground.

  After a briefing at Scotland Yard I was taken round Brixton. At Brixton Police Station I went into the canteen to thank the staff there — as I had thanked the police officers themselves — for all that they were doing. I also talked with the West Indian ladies in the canteen. They had gone into work throughout the disturbances, determined that the police should be supported with proper canteen facilities whenever they needed them at any hour of the day or night. They were clearly as disgusted as I was with those who were causing the trouble.

  Later I returned to Scotland Yard where I had a long discussion with the Commissioner of the Metropolitan Police, Sir David McNee, his Deputy and Assistant. They had a number of worries: they told me that they wanted to see sentences administered quickly on the offenders — something which long delays at the Crown Courts often prevented; they were concerned that their powers of arrest were insufficient; and above all, they needed proper riot equipment, as a matter of urgency. I promised them every support. It was something of a shock to contemplate the kind of equipment the British police now required, which included a greater variety of riot shields, more vehicles, longer truncheons, and sufficient stocks of rubber bullets and water cannon. They had already received vital protective helmets from the MoD, but these had had to be altered because the visors provided inadequate protection against burning petrol. Afterwards I stressed to Willie the urgency of meeting these requirements.

  On Monday 13 July I made a similar visit to Liverpool. Driving through Toxteth, the scene of the disturbances, I observed that for all that was said about deprivation, the housing there was by no means the worst in the city. I had been told that some of the young people involved got into trouble through boredom and not having enough to do. But you had only to look at the grounds around those houses with the grass untended, some of it almost
waist high, and the litter, to see that this was a false analysis. They had plenty of constructive things to do if they wanted. Instead, I asked myself how people could live in such circumstances without trying to clear up the mess and improve their surroundings. What was clearly lacking was a sense of pride and personal responsibility — something which the state can easily remove but almost never give back.

  The first people I talked to in Liverpool were the police, whose comments and requirements for equipment were similar to those in London. I also met councillors at Liverpool City Hall and then talked to a group of community leaders and young people. I was appalled by the latter’s hostility to the Chief Constable and the police. But I listened carefully to what they had to say. There were two people with them who appeared to be social workers, and who began by trying to speak on their behalf. But these young people did not need anyone to speak for them: they were articulate and talked about their problems with great sincerity. The press were rather confused when, contrary to what they had been expecting, the youngsters told them that I had indeed listened. But I did more than listen: I had something to say myself. I reminded them that resources had been poured into Liverpool. I told them that I was very concerned by what they had said about the police and that while the colour of a person’s skin did not matter to me at all, crime did. I urged them not to resort to violence or to try to live in separate communities from the rest of us. Before I returned to London I also talked to the Catholic Archbishop and the Anglican Bishop of Liverpool, who had jointly won national attention as great advocates for their city.