Margaret Thatcher: Power and Personality (59 page)

The health cuts caused a storm, coming so soon after an election in which Margaret Thatcher had promised that the NHS would be safe in her hands. But she rode it out by arguing that prudent housekeeping to keep the NHS within its original budget was no more than ‘very, very good government’.
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The description was broadly justified because Lawson’s medicine worked, and confidence grew.

By the end of the year, the economy was picking up steam. Britain was showing the fastest rate of growth in Europe, according to a December 1983 Organisation for Economic Co-operation and Development (OECD) report. Public borrowing had come under control. Margaret Thatcher claimed to be creating ‘a picture of rising demand and activity levels spreading more widely through the economy, and rising investment’.
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This spirit of optimism was consolidated by the 1984 Budget. Business was delighted by the Chancellor’s cut in corporation tax from 52 to 35 per cent over three years. Savers liked his abolition of the 15 per cent surcharge on investment income. 850,000 low-paid workers were taken out of income tax altogether by raising personal thresholds. The National Insurance surcharge, often described as a tax on jobs, was abolished.

This first Lawson Budget received an almost rapturous reception from the Prime Minister, from the press and from Parliament. Although it was very much the Chancellor’s own work and cleverness, Margaret Thatcher had made three important contributions to its success. First, she had been involved in the strategic planning over suppers at No. 11 from the beginning of the budgetary process. Second, she had earlier swung a divided cabinet behind the big curbs on public expenditure and borrowing in July 1983, which made the tax reductions possible. Third, she had given some last-minute presentational advice, without which the Budget would almost certainly have received much adverse press coverage.

In his efforts to broaden the base of VAT, Lawson was secretly planning a surprise move to extend the tax to newspapers and magazines. He told the Prime Minister that he was going to do this, during their final pre-Budget discussion. She saw, as he did not, the negative impact on Fleet Street that the ending of the VAT exemption for newspapers would have. ‘Look, Nigel,’ she said, ‘this is a wonderful Budget and you should get a wonderful reception. You don’t want to spoil that by putting VAT on newspapers.’
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It was a good example of how Margaret Thatcher’s cautious political antennae were often superior to those of her senior colleagues. On this occasion, Nigel Lawson heeded her advice, dropped the proposal and, as a result, received bouquets from the press instead of the brickbats that would have been thrown at him by an industry unexpectedly required to pay £200 million a year in VAT.

The 1984 Budget was a mood changer for the government. The gloom over its early glitches lifted. Although unemployment remained stubbornly high, confidence soared in many sectors of the economy, particularly in the City of London. There was a banking bonanza from the flow of massive privatisation issues, which in the second term saw British Telecom, British Gas, Enterprise Oil, Jaguar, Rolls-Royce and British Airways return to the private sector.

The big one that got away was the Royal Mail, because Margaret Thatcher stamped her foot and ruled to Patrick Jenkin, ‘You can’t touch that – it’s Royal’. It was an irrational attitude, which Jenkin thought ‘Absolutely absurd’, but he and his successors toed the line.
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Margaret Thatcher’s personality played its part in both the strengths and the weaknesses of privatisation. Strength came from her instinctive understanding that the programme was not just a series of commercial transactions; it was an important plank in her personal philosophy that the frontiers of state socialism should be rolled back. ‘Privatisation is at the centre of any programme of reclaiming territory for freedom’, she asserted.
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By 1989 she was able to claim, ‘Privatisation: five industries that together were losing over £2 million a week in the public sector, now making profits of over £100 million a week in the private sector.’
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Yet she did not do as much as she might have done to promote freedom of competition within the architecture of privatisation. The Electricity industry simply became a series of regional monopolies, with their ownership ending up in the hands of foreigners.

As Chancellor, Nigel Lawson was a major driving force in the privatisation strategy. His battles with Sir Denis Rooke, Chairman of British Gas, who tried to obstruct the policy at every turn, became legendary. Other senior ministers such as Norman Tebbit, Patrick Jenkin and John Moore were key players too. But historically, the glory for this revolutionary, widely imitated and highly successful privatisation initiative went to Margaret Thatcher. It is seen to this day as one of the most important parts of her legacy.

Privatisation brought unexpected receipts to the Treasury of £13.5 billion during the second term. It was accompanied by cultural changes in the British economy, largely inspired by the tax cuts, incentives, deregulation and market liberalisation which the government’s economic strategy encouraged.

One of the most important manifestations of these changes was the ‘Big Bang’ in the City of London, which introduced new technology, new foreign investment and a wave of mergers into the traditional financial sector practices of jobbing, broking and old-boy networking. The transformation created many fortunes and opportunities in the City, while in other sectors of the economy there was a similar surge in technology-led entrepreneurship.

All this activity became know as the ‘Lawson boom’. Initially it was seen as a huge success, not least by Margaret Thatcher, who regarded her Chancellor as the brilliant brain masterminding what she called the ‘enterprise culture’. Her views of the culture, the boom and the Chancellor were later to turn sour. But for most of her second term, Nigel Lawson was her blue-eyed boy.

REFLECTION

It was strange that so determined a prime minister should have made so accident-prone a beginning to her second term. The explanations for this faltering start were to be found in her lack of preparation, and a series of misjudgements fuelled by hubris.

Margaret Thatcher prepared assiduously for almost every action and decision she took in government. One notable exception was her failure to pay attention to the Conservative Party’s 1983 election manifesto. It was a policy-lite document. Because the Tories were so far ahead in the polls, the electorate took little interest in the lack of substantive pledges for the next five years. Margaret Thatcher herself brushed aside all criticisms on this score during the campaign.
She then became highly critical of those she felt had left her with an empty cupboard of legislative proposals for the new Parliament. In fact, she herself was responsible for this vacuum.

There was a vacuum of ministers as well as measures, thanks to the troubles of Cecil Parkinson. He was a good choice for the post of Foreign Secretary, and his inability to take the job weakened the entire government. Margaret Thatcher handled his problems broadmindedly but badly. Her insistence that he should take the lower profile post of Secretary of State for Trade and Industry was a mistake. Why she believed that he would be any safer from exposure in that department than at the Foreign Office is a mystery.

The Prime Minister’s intervention saved the Parkinson marriage, but only managed to preserve the Parkinson job for four more months. In October, in the middle of the Conservative Party Conference, the suppressed scandal hit the headlines with a vengeance. This was the appropriate word, since Sara Keays made disclosures in the press and in her book,
A Question of Judgement
, which reminded many of the old adage: ‘Hell hath no fury like a woman scorned.’
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In the heat of the fury, Cecil Parkinson had to resign. It would have been better for everyone if he had been allowed to do so after the election.

The Parkinson problem, like the Speakership problem, was caused by the Prime Minister’s hubris. In her first term she was often insecure. In her third term she was overbearing. During the second term her personality was moving into territory somewhere between the two, with growing signs of unreasonable arrogance.

Her attitude to the Foreign Office was a constant source of friction. A few months after the Falklands she decided she should have her own foreign-policy adviser installed in No. 10. This alarmed the civil service establishment. Her new Principal Private Secretary, Robin Butler, was bold enough to have ‘an enormous row’
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with her on the issue. He lost the argument, although perhaps not as badly as he had thought, for the first No. 10 adviser on foreign affairs was Sir Anthony Parsons. He was an original and iconoclastic Foreign Office diplomat, but with sufficiently deep roots in his institution to keep the tensions between Downing Street and King Charles Street simmering gently rather than boiling over. Sir Geoffrey Howe had no such success, as will emerge in later chapters.

At one moment when working with Parsons, Margaret Thatcher made an unexpected observation. ‘You know, Tony, I’m very proud that I don’t belong to your class.’

‘What class do you think I belong to?’ asked the surprised former Ambassador to Iran and the United Nations.

‘I am talking about upper middle class intellectuals who see everybody else’s point of view and have none of their own’ replied the Prime Minister.
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In that response lay both the strengths and weaknesses of Margaret Thatcher’s personality. Leaving aside her distaste for intellectuals she had a real problem in seeing, let alone accommodating, a point of view other than her own. This made her seem, on a bad day, unreasonable, narrow minded or even bigoted in her apparently uncaring attitudes. Nuances and consensus had no appeal to her. She had no empathy for those adversely affected by her policies.

Yet it was rarely that simple. She liked argument. She changed her mind more often than she admitted, and listened more than most people realised. ‘She could even manage to listen when she was talking’,
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claimed Robin Butler, recognising a talent in her that escaped others.

The same forces that could seem stubborn and overpowering were also the wellsprings of her courage. This was the quality that had been recognised by the country during the Falklands crisis. It would be recognised again as she grappled with her two greatest dramas on the domestic front – the fight against terrorism and the miners’ strike.

24

Terrorism, Ireland and Hong Kong

FACING DOWN TERRORISM

Terrorism posed a continuous threat to Margaret Thatcher. She faced it with courage and determination. There was no finer example of her unflinching steadfastness under attack than her reaction to the bombing of the Grand Hotel in Brighton where she was staying for the party conference in October 1984. But long before that outrage, she had to deal with other episodes of terrorist violence. The way she handled them revealed much about her character and personality.

A few weeks before she became Prime Minister, one of her closest colleagues, Airey Neave, was assassinated by a bomb, which detonated as he was driving out of the House of Commons car park. The device had been planted by the Irish National Liberation Army, a breakaway faction of the IRA. Although Margaret Thatcher’s public reactions to the killing were fierce in their condemnation of the ‘common criminals’
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who had committed the murder, her private sorrow was agonising. The tragedy was an early warning of the high risks that she and many other prominent figures were facing from Irish terrorism.

Four months after the 1979 election, the IRA terrorists struck two blows in a single day on 27 August. Earl Mountbatten, the Queen’s second cousin, two members of his family and a local boy were murdered when their boat was blown up in County Sligo. At Warrenpoint, near Neary, close to the border between Northern Ireland and the Republic, two booby-trap bombs killed eighteen British soldiers from the Parachute Regiment.
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After writing letters to the bereaved families, Margaret Thatcher decided to visit the British troops and officers of the Royal Ulster Constabulary who were in the front-line of the fight against terrorism. Two days after the tragedy she flew to Belfast, went on a walk-about in the city centre, and visited injured
soldiers in hospital. Then she took a helicopter to the heart of what was called ‘bandit country’ in South Armagh, where she visited army and RUC bases at Crossmaglen and Gough. Wearing, against advice, a Greenfinches camouflage jacket and beret borrowed from a female soldier of the Ulster Defence Regiment, she had to run to and from her helicopter to minimise the possibility of a sniper attack.
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The courage and symbolism of her visit made a great impact on the people of Northern Ireland. ‘From that time on, Ulster knew that we had a British Prime Minister with plenty of guts who would give no quarter to the IRA’, said the Unionist politician Harry West.
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Another episode which enhanced Margaret Thatcher’s decisiveness when dealing with terrorist issues was shown by her handling of the Iranian Embassy siege. On 30 April 1980, a group of six Iraq-trained Arab Iranian gunmen seized the embassy and captured twenty-six hostages, including a police constable who had been on duty outside and two BBC journalists who had been applying for visas. Six days later, after the gunmen had killed one hostage, throwing his body out of the embassy, the Prime Minister authorised the SAS to go in. Their operation, covered live on television, was a military success. The twenty-five surviving hostages were safely rescued; five of the gunmen were shot dead and one was captured.
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Mission accomplished, Margaret Thatcher went to congratulate the SAS men in their London barracks in Regent’s Park. She arrived unannounced at 9.58 p.m. in evening dress, accompanied by the Director of the SAS Brigadier Peter de la Billière, Cabinet Office official Richard Hastie-Smith and Denis. The forty soldiers of the Pagoda Unit, who had carried out the raid, were stripping off their black denims and passing round cans of Tennent’s lager. Suddenly they heard the startled voice of their commander, Major Jeremy Phipps, saying, ‘Good evening, Prime Minister’. It was almost the only greeting she received, because a few seconds later the chimes of Big Ben started booming out from a large television set at the end of the gym, heralding the start of
News at Ten
. With typical Hereford indifference towards the visiting VIPs, the SAS men rushed over to the screen amidst cries of ‘Siddown’ – a command which Margaret Thatcher herself obeyed. She sat on the floor at the front of the semi-circle of soldiers, steadying herself with one hand on the shoulder of a burly trooper. Once or twice she interjected ‘Isn’t this exciting … how exciting!’ as the day’s dramatic events were replayed on the news. When it ended, the Prime Minister
thanked the men for doing their job ‘so well and so courageously’,
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staying long enough to shake hands with them, while Denis enjoyed a can of Tennent’s. One of the officers thought he saw the beginnings of a love affair that evening between the Prime Minister and the SAS regiment, which at that time was little known to the general public. ‘We never thought you’d let us do it’, said one trooper.
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‘I took the right decision. Terrorists must never prevail’, ‘she responded.’
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The military were getting the message that the new Prime Minister would not falter in her determination to defeat terrorism.

Margaret Thatcher displayed the same determination in her confrontation with the IRA hunger strikers. As part of a series of protests against IRA terrorists not being recognised as ‘political prisoners’, a number of them, headed by the convicted murderer Bobby Sands, announced they would ‘fast until death’ in the Maze prison. The propaganda battle waged by the IRA on behalf of the hunger strikers produced an unyielding response from the Prime Minister. She rejected their claim that convicted terrorists should be granted ‘political’ status. Answering a question on the subject at the EEC Dublin summit in December 1980, she said bluntly: ‘Murder is a crime. Carrying explosives is a crime. Maiming is a crime … Murder is murder is murder. It is not, and never can be, a political crime. So there is no question of political status.’
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Amidst rising violence in Northern Ireland, Bobby Sands and three other hunger strikers died in May 1981. Later that month, Margaret Thatcher visited the province where she was asked by a television reporter if she was prepared to see ‘an endless stream of hunger strikers die’. She replied:

That is a matter for those who go on hunger strike, and those who are encouraging them to do so. I am not urging them to go on hunger strike. I am urging them not to die … it is they who are sentencing their own people, to death, not me.
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Eventually the IRA got the message that the Lady was not for turning on terrorism. They blinked. Under pressure from the Church and from the families of fasting prisoners, the hunger strike was called off in October 1981.

During the seven months while the Sands protest lasted, the IRA killed thirteen policemen, eight British soldiers, five members of the Ulster Defence Regiment and five civilians. This was one of the bloodiest periods of the Troubles with a total of 61 people killed, 34 of them civilians.
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Meanwhile, the IRA was extending its terrorism to bombings in London and other mainland cities. The worst of these atrocities came in a double attack on 20 July. One bomb killed two soldiers of the Household Cavalry, injuring twenty-three others. Two hours later, a second device placed beneath the bandstand in Regent’s Park killed six soldiers of the Royal Green Jackets and injured a further twenty-four people attending a lunchtime concert. The final toll was eleven dead, fifty injured and seven cavalry horses killed.
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On Saturday 17 December 1983, two police officers and three passers-by, including an American, were killed in a bomb attack outside Harrods. A further seventy-five were injured and a third police officer died of his injuries on Christmas Eve. Margaret Thatcher was on the scene less than an hour after the explosion. She was sickened by the sight of a teenage girl’s charred body that was impacted against the window of the store. Encouraged by his wife, Denis Thatcher went Christmas shopping in Harrods forty-eight hours after the bombing.
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The most politically targeted of the IRA attacks was on the Grand Hotel in Brighton during the Conservative Party Conference in October 1984. Margaret Thatcher was lucky to survive it, for the bomb was planted to kill her. It destroyed the central section of the hotel, and wrecked many other rooms, including her bathroom. If she had been using it at the time, she would have been seriously injured or killed. But, night owl that she was, the early hours of the morning of Friday 12 October found her still working on the conference speech that was to be delivered a few hours later.

She said good night to her speech-writers, gave the draft a last tweak or two, and was about to turn in when her Principal Private Secretary, Robin Butler, put one last official document in front of her, saying, ‘Can I give you this to look at overnight, and you can tell me by breakfast what you want done.’
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It was 2.50 a.m. Her quick glance at the document – about funding for the Liverpool Garden Festival – delayed her for a crucial moment or two from what might have been a fatal journey to the bathroom. For she was still in the sitting room of her suite alone with Robin Butler when at 2.54 a.m. a loud thud shook the hotel, followed by the sound of cracking masonry. Plaster fell from the ceiling. A slab of glass from a shattered window crashed onto the carpet. Margaret Thatcher immediately knew that a bomb had exploded, but did not realise the blast had been above her in the hotel. She thought a car bomb might have detonated on the sea-front, so went to look out of the window.

‘Come away from the window’, said Robin Butler. Before he had time to give her any further advice, she darted ‘like a rabbit shooting into its burrow’
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towards the bedroom, saying, ‘I must see if Denis is all right’. Her instinctive reaction was a dangerous one, for it was immediately followed by the noise of falling masonry – fortunately not from the bedroom but from the adjacent bathroom. To the huge relief of her Private Secretary, the Prime Minister reappeared a few moments later accompanied by Denis. He was pulling on his clothes over his pyjamas. ‘I’ve never seen so much glass in my life’, said Denis, referring to the damage in the bathroom.
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The next few minutes seemed deceptively normal. Surprisingly, the lights were still working. Denis went back into the bedroom to get fully dressed. Robin Butler tidied up government papers. The Prime Minister went across the corridor to see if the secretaries on duty were all right. Their main concern was that they had not finished typing up the speech. Margaret Thatcher sat down in one of their chairs, murmuring to no one in particular, ‘I think that was an assassination attempt, don’t you?’
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Gradually, other figures from the hierarchy who had been sleeping in the same part of the hotel started to arrive in the secretaries’ room. They included Geoffrey and Elspeth Howe, Party Chairman John Gummer and his wife Penny who was still in her nightdress, Keith Joseph in silk pyjamas and dressing gown, David Wolfson and Ronnie Millar.

Michael Alison, the Prime Minister’s Parliamentary Private Secretary, and a man of strong faith, said to her quietly, ‘Thank God you are all right, Margare …’

‘I do. I do thank him’, she replied.
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Alison recalled the scene as

Very British. Everyone kept a stiff upper lip. There were quite long silences. One or two people wondered whether a second bomb might have been primed to go off. Margaret was very steady. She asked me if the Conference Hall had been damaged. I said I didn’t think it would have been as it was a quarter of a mile away. With great firmness, she said, ‘Then it’s important that we begin on time at 9.30’.
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Robin Butler, who had not heard the conversation with Michael Alison, suggested that the Prime Minister should return to London, an hour’s drive away. ‘I’m not leaving the area’, she replied firmly.
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The decision on what to do next was taken out of her hands by the arrival of a fireman at 3.10 a.m., followed by Special Branch protection officers. The fireman cautiously led the Prime Minister and her party downwards out of the Grand Hotel. It was not a quick exit. One of the first routes they tried was impassable, so she had to wait in an office. After a while, it was deemed safe to descend by the main staircase. Around it, the air was swirling with cement dust, which made her cough. It covered the blue ball gown she had worn for her appearance at the Conservative Party agents’ dance some six hours earlier. As the white dust settled on the dress, it gave her the appearance of a ghostly apparition as she clambered over chunks of masonry and broken furniture. Arriving in the foyer, she insisted on checking that all the reception staff on duty had been accounted for. Only after hearing that they were all safe did she agree to leave the hotel by a back exit, under heavy police protection.
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In the chaos outside the hotel, rumours had begun spreading that Margaret Thatcher had been killed. The sea-front was crowded with conference delegates tumbling out of nearby hotels. I was one of them, and remember staring with amazement at the gaping hole in the front of the Grand, wondering who had or had not survived. But then the word was shouted round that the Prime Minister had been seen coming down the main staircase. The cry went up, ‘Maggie’s safe!’ Such was the relief that strangers shook hands, and clasped each other’s shoulders – but in silence.

On leaving the hotel, the Prime Minister was driven to Brighton police station where she was joined by various cabinet ministers including Willie Whitelaw, Keith Joseph, Geoffrey Howe and his wife Elspeth, with Budget, their dog, John Gummer and Leon Brittan. Her security advisers tried to persuade her to return to No. 10. She would have none of it.

Margaret Thatcher changed out of her evening dress into a navy-blue suit, which her personal aide, Cynthia Crawford (‘Crawfie’), had salvaged from the hotel bedroom. Then she was driven to Lewes Police College. It was so heavily surrounded by armed men with machine guns that it resembled a military bunker. Once inside, she was allocated a twin-bedded room, which she shared with Crawfie. Denis found other accommodation further down the corridor where he dossed down with Special Branch protection officers.