The Downing Street Years

by Margaret Thatcher

  On Tuesday 10 May I held a meeting of ministers at which we decided our manifesto commitment. On essential services, the introduction of strike ballots would clearly help reduce the risk of strikes in these areas. But we would also consult further about the need for industrial relations in specified essential services to be governed by adequate procedure agreements, breach of which would deprive industrial action of immunity. On the question of the political levy, we had evidence from the consultations on the green paper that there was widespread disquiet about the operation of the system and we proposed to consult with the TUC to see what action they were prepared to take, failing which we would act ourselves. These were matters to which we would have to return after the election. But we had made substantial progress in reducing the overbearing power of trade unions — much more than the fainthearted had ever believed possible. And far from proving a political incubus it was one of our strongest appeals to the voters.

  POLICY WORK

  For all sorts of reasons it is much easier to prepare for an election when you are in government than in Opposition. You have more information available about forthcoming events and more power to shape them. But parties in government have disadvantages as well, and you face two risks in particular. First, ministers can get out of the habit of thinking politically and become cocooned in their departments. Having to face, as I did, rigorous cross-questioning from an often hostile House of Commons twice a week, there was little danger that I, personally, would succumb to this: but others might. The second risk is that having implemented its manifesto, a government may run out of ideas. It is part of the job of ministers to see that this does not happen in their own areas of responsibility, and the job of the prime minister to prevent it happening to the government as a whole.

  One of the main obstacles to the kind of forward thinking which all governments should do is the unauthorized disclosure of information by disaffected ministers or civil servants. A particularly serious problem arose in the last half of the 1979–83 Parliament. In March 1982 Geoffrey Howe asked officials to undertake an examination of long-term public expenditure up to and including 1990 and its implications for levels of taxation: their report was presented to me on 28 July. Spending ministers were inclined to think that this was just another exercise to soften them up for cuts in public expenditure. But in fact it was intended to get us all to examine how the long-term momentum for the expansion of the state and public spending might be curbed and reversed. As it turned out the paper was excessively gloomy and its most likely scenario underestimated very substantially the economic growth rate for the 1980s. To make matters worse, the CPRS prepared its own paper to accompany the Treasury paper, which contained a number of very radical options that had never been seriously considered by ministers or by me. These included, for example, sweeping changes in the financing of the National Health Service and extensions of the use of charging. I was horrified by this paper. As soon as I saw it, I pointed out that it would almost certainly be leaked and give a totally false impression. That is exactly what happened.

  When the papers were discussed at Cabinet in early September, they made no great impact on our thinking. Our main conclusions could have been reached without any such exercise: that there should be no major new expenditure commitments pending further consideration, and that we should generally examine the scope for changing policies in ways which would bring public spending under proper control. My separate meetings with Keith Joseph on education and Norman Fowler on Health and Social Security confirmed that neither of them felt in any way attracted to the particular proposals which had been put forward, many of which were neither desirable nor practicable. But that failed to stop the media frenzy. A fairly full account of the CPRS paper duly appeared in the Economist. The Observer developed the story. The Economist later gave a blow-by-blow account of discussions at Cabinet. The Observer and then The Times revealed still more information. Of course, the Opposition had a field day. We were to be plagued by talk of secret proposals and hidden manifestos up to polling day and beyond. It was all the greatest nonsense.

  There were two lessons from this incident which I never forgot. The first was that we had political opponents about us who would stop at nothing to distort and thereby prevent our forward thinking on policy. The second lesson was of equal importance: it was unacceptable for highly controversial proposals to come before Cabinet without the prior knowledge and approval of the ministers responsible. This raised acutely what role there could be for the CPRS.

  In earlier days, the CPRS had been a valuable source of sound long-range analysis and practical advice. But it had become a freelance ‘Ministry of Bright Ideas’, some of which were sound, some not, many remote from the Government’s philosophy. Moreover, as I have noted earlier, a government with a clear sense of direction does not need advice from first principles. Now, as this incident had shown, the CPRS could become a positive embarrassment. That was why, shortly after the election, I was to dissolve the ‘Think-Tank’, and ask two of its members to join the in-house Policy Unit which worked more closely with me.

  Ferdy Mount was now head of my Policy Unit. I had long been a great admirer of Ferdy’s witty and thoughtful articles even when, as over the Falklands, I did not agree with his views; and I was delighted when in April 1982 he agreed to succeed John Hoskyns. Ferdy was particularly interested in all that goes under the heading of social policy — education, criminal justice, housing, the family and so on, to which, in the wake of the 1981 urban riots, I was increasingly turning my attention. In late May he prepared for me a paper which contained the outline of an approach to ‘renewing the values of society’:

  This Government came to power asserting that it is the exercise of responsibility which teaches self-discipline. But in the early stages of life it is the experience of authority, when exerted fairly and consistently by adults, which teaches young people how to exercise responsibility themselves. We have to learn to take orders before we learn how to give them. This two-way relationship between obedience and responsibility is what makes a free, self-governing society. And in the breakdown of that relationship we can trace the origins of so much that has gone wrong with Britain.

  If we can rebuild this relationship, we might begin to restore also respect for law and order, respect for property, and respect for teachers and parents. But the rebuilding itself has to be a two-way business. On the one hand, we need to restore effective authority to teachers and parents. On the other hand, we need to offer young people a taste of responsibility and a useful role in society.

  At this stage it was the themes rather than the particular measures which needed to be worked out, and Ferdy and I discussed what these should be. In education, for example, we wanted to increase parent power, widen the variety within the state sector and see whether we could come up with workable proposals for education vouchers. We were concerned about the lack of knowledge displayed by many children about our country and society, and our history and culture. Of course, these and other topics — like all the really great issues — were never going to be amenable to instant action. But both Ferdy and I were convinced that at the heart of the Conservative mission is something more than economics — however important economics might be: there is a commitment to strengthen, or at least not undermine, the traditional virtues which enable people to live fulfilling lives without being a threat or a burden to others. This was the beginning of many of the themes and ideas which would dominate my third term of office.

  Indeed, as early as June 1982 I set up an ad hoc group of ministers to see how this ambitious programme could be developed, comprising Keith Joseph, Willie Whitelaw, Geoffrey Howe, Norman Tebbit, Michael Heseltine, Norman Fowler and Neil Macfarlane (as Sports minister). I invited Janet Young to join us in October. The group was officially — though rather misleadingly — known as the Family Policy Group’; the first meeting was held in July 1982 and detailed work was now commissioned. All sorts of questions came within its remit, including
the reform of the taxation of husband and wife, education vouchers, reducing crime and the widening of home ownership through increased discounts for the sale of council houses.

  It is never easy to make the transition from policy-making in government to writing a party manifesto. In 1982 I used a special exercise to ease the problem. In September I wrote to Cabinet ministers requesting them to prepare a ‘Five-Year Forward Look’ for their departments. These papers were to summarize what had been achieved, what was under way and what still needed to be done. I received most of these papers just before Christmas and looked through them over the holiday. As someone once said of British Rail food, there was a considerable variation in quality. Relatively little new could be said on Treasury matters because the strategy was clear and the real test was to follow through the policies we already had. Similarly, as regards the Health Service the main priority at that stage was to defend our record and explain what had been achieved, rather than embark on politically difficult new initiatives.

  By contrast, in both housing and local government there was more room for new thinking. The ‘Right to Buy’ had proved a huge success, but the wider we could extend home ownership in this way the more difficult it would be for Labour to oppose it. In employment, we were preparing for the introduction of the Youth Training Scheme and discussing the next step in trade union reform which would eventually result in the 1984 Employment Act.

  In education, Keith Joseph had begun what would be a long process of reform. Falling school rolls had allowed us to increase to record levels public spending per pupil and to achieve the best ever pupil-teacher ratios. But extra resources only permit improved standards: they do not ensure them. So Keith was pressing for changes in teacher training. He was issuing new guidelines for the school curriculum. Keith and I were also anxious to do something more to increase parents’ power to choose by seriously investigating the possibilities of vouchers or at least a combination of ‘open enrolment’ and ‘per capita funding’, that is a kind of voucher applying just to the state sector.

  There was a new momentum for fresh thinking at No. 10 and ministers had taken stock of their policies. By the end of 1982, although I was still not expecting an early general election, I felt that the Government was moving, as it should, into the run-up for the next campaign. There were plenty of possibilities for mishap, but our general political position was strong and the economic prospect was improving. Indeed, well before the end of the year I had authorized the setting-up of party policy groups to consider these and other proposals for the manifesto. Speculation about the date of the election soon began.

  * See pp. 236–7.

  * See p. 107.

  CHAPTER XI

  Home and Dry

  The background to and course of the 1983 general election campaign

  THE MANIFESTO

  The central importance of the manifesto in British general elections often strikes foreign observers as slightly odd. Party manifestos in Britain have acquired greater and greater significance over the years and have become increasingly detailed. In the United States and continental Europe, party ‘platforms’ have less authority and as a result they are not nearly as closely studied. Even in Britain it is only relatively recently that manifestos have been so full of detailed proposals.

  The first Conservative manifesto was Sir Robert Peel’s 1835 address to his electors in Tamworth. The ‘Tamworth manifesto’, for all the obvious differences, has one basic similarity with the Conservative manifesto today: it was then and is now very much the party leader’s own statement of policies.

  I was never encumbered with the ramshackle apparatus of committees and party rules which makes the drafting and approval of Labour’s manifesto such a nightmare. However, the party leader cannot dictate to senior colleagues: the rest of the government and parliamentary party need to feel committed to the manifesto’s proposals and consequently there has to be a good deal of consultation. I discussed the question with Cecil Parkinson and we agreed that Geoffrey Howe was the right person to oversee the manifesto-making process. There has never been a more devout believer in the virtues of consultation than Geoffrey. It had been necessary to exclude the Treasury from the Falklands War Cabinet and naturally he welcomed this chance to widen his role. As Chancellor of the Exchequer he had the seniority and experience to supervise the required policy work. Looking back, this arrangement was successful in one of its aims — that of reducing the burden on me — but, as we shall see, it turned out to have significant drawbacks. In 1987 I decided to oversee the preparation of the manifesto myself.

  The whole process began almost a year before the election. On Saturday 19 June 1982 I approved the setting up of party policy groups with the remit of identifying ‘tasks for Conservative administration during the rest of this decade; to make proposals for action where possible; where not possible, to identify subjects for further study’. Eleven such groups were originally envisaged, though in fact two were never set up: we dropped the idea of a group on ‘constitutional reform’ because I felt that there was really nothing of note to say on that subject, and the terms of reference on ‘the extension of choice’ turned out to be too vague. (This was a theme better dealt with in detail by the other groups.) The nine we did set up covered unemployment, enterprise, family and women’s affairs, education, the cities and law and order, the poverty trap, the European Community, nationalized industries and urban transport. We decided that the chairman of each group should be a parliamentarian — an MP or peer — who would help to select members for their group from among the Conservative-minded in the worlds of business, academe, voluntary service and local government. To keep the Government informed, special advisers to the relevant Cabinet ministers would sit in on the meetings. (Special advisers are political appointees, and so free from the constraints of political neutrality which prevent the use of civil servants in such roles.) Secretarial and research work was done by members of the Conservative Research Department.

  Essentially, the policy groups had two purposes. The first and more important was to involve the Party as a whole in our thinking for the future. In this I believe they were successful. The second was to come up with fresh ideas for the manifesto, and unfortunately in this purpose they failed. For one reason or another it took too long to find appropriate chairmen and the right balance of group members. It was not until October or November 1982 that the groups actually got down to work — originally, optimistically, we had thought that they might get started in July. The groups were due to report only at the end of March 1983, but by then of course we in government were all well advanced on our own policy work. Another problem is the human vanity of wanting to demonstrate that you are on the inside track. All too often their proposals trickled out through the press. Indeed, The Times published a detailed account of the report from the Education Policy Group.

  The fact is that the really bold proposals in any manifesto can only be developed over a considerable period of time. Relying on bright ideas thought out at the last moment risks a manifesto that would be incoherent and impossible to carry out. So, in the end, the real work for the 1983 manifesto had to be done in No. 10 and by ministers in departments.

  As head of my Policy Unit at No. 10, Ferdy Mount was ideally placed for manifesto drafting, and uniquely gifted for it too. He was able to see how ministers were thinking from the ‘Forward Look’ papers I received at the end of 1982. The next step was taken in February 1983, when Geoffrey Howe wrote to Cabinet colleagues, asking them to send him their suggestions for the manifesto not later than April. Their submissions would then be accepted, sharpened up or rejected by a smaller group of ministers and advisers directly responsible to me. The Treasury would keep a weather eye on the cost of proposals — another advantage of Geoffrey’s close involvement — with the result that we were able to say during the election that all of our proposals had been taken into account in the latest Public Expenditure White Paper. Since we expected the contrast between Tory prudence
and Labour profligacy to be a central issue in the campaign, this made political as well as economic sense.

  Ferdy, Geoffrey Howe, and Geoffrey’s special adviser, Adam Ridley, worked intensively together on Ferdy’s first draft during March and early April. Subsequently, they were joined by Cecil Parkinson, Keith Joseph, Norman Tebbit, David Howell and Peter Cropper (the director of the Conservative Research Department), over the weekend of 9–10 April at which departmental submissions were fully considered. By the end of April we had a fairly complete draft, on which I worked with Geoffrey, Cecil, Ferdy and Adam at Chequers on Sunday 24 April. Shortly afterwards, the Party’s Advisory Committee on Policy met under Keith Joseph’s chairmanship to give it the Party’s final seal of approval: interestingly, in the light of later events, the main criticism came from the two representatives of the ’22 Committee who thought that we were not doing enough to reform the rates. On Wednesday 4 May chapters of the draft manifesto were sent for checking and agreement to individual ministers. A few final changes were made later still at my last pre-election strategy meeting at Chequers the following Sunday, after which it was at last ready to go to the printers. It was finally submitted in proof to an unofficial meeting of Cabinet.

  The most important pledges in the manifesto fell into three groups. First, we promised to accelerate privatization, which was fundamental to our whole economic approach. If elected, we committed ourselves to sell British Telecom, British Airways, substantial parts of British Steel, British Shipbuilders, British Leyland and as many as possible of Britain’s airports. The offshore oil interests of British Gas would also be privatized and private capital would be introduced into the National Bus Company. This was an ambitious programme — far more extensive than we had thought would ever be possible when we came into office only four years before.