Margaret Thatcher: Power and Personality (64 page)

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Unions and miners

STEPPING STONES TOWARDS SOLVING THE PROBLEM

The most important achievement of Margaret Thatcher’s second term as Prime Minister was the defeat of the National Union of Mineworkers’ strike in 1984–1985. It exorcised the demon of militant trade unionism, which had done such damage to the economy throughout the 1970s, and driven two prime ministers – Ted Heath and James Callaghan – from office.

Yet, although the economic and constitutional benefits to the nation from victory in the miners’ strike were enormous, there were two surprises about Margaret Thatcher’s handling of the union militancy problem. The first was how cautiously and falteringly she initially faced up to it. The second was how little credit she and her government were given for solving it. These paradoxes deserve explanation.

From the time when she replaced Ted Heath as Tory leader, Margaret Thatcher realised that she would one day have to confront the union extremists. Unfortunately, she had no coherent idea how or when to do this. The clarity of decision-making that was usually the hallmark of her personality was noticeably absent from her early attitude towards trade-union issues. Her main difficulty was that she was boxed in by a combination of political history, parliamentary fears and cabinet caution.

In the light of 1970s political experience, the conventional wisdom of the Tory Party was that picking a fight with the unions was the kiss of political death. At one of Margaret Thatcher’s early shadow cabinet meetings, Lord Carrington quoted Harold Macmillan’s dictum: ‘No Government should ever take on the Brigade of Guards, the Vatican or the National Union of Mineworkers.’
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As Ted Heath had just lost the February 1974 election because of his unsuccessful battle with the miners, the axiom seemed to have been proved. So if there was any strategy at all within the Conservative Party towards the unions in the mid-1970s it was the ‘softly, softly’ approach personified by Jim Prior. Margaret Thatcher instinctively believed it was inadequate, but for a long while did nothing to change it.

The first stirrings of change came at the end of 1977 when she read a confidential briefing paper titled
Stepping Stones
. Its authors, who had been introduced to her by Keith Joseph, were two independent-minded businessmen, John Hoskyns and Norman Strauss.

Their central message was that a future Conservative government would have no chance of halting Britain’s economic decline unless it was prepared to implement a determined strategy in facing down the excesses of union power. Hoskyns described it as

a shit or bust strategy … we set out to convince Margaret that it was no use trying to be a Heath Mark II, even if she kept her nerve a bit longer than he did. We were offering something completely different, saying that the unions had to be confronted and that the union militants would have to be destroyed. Without the resolve to do this her efforts to revive the economy would be a case of ‘steady as she sinks!’
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Margaret Thatcher liked blunt-speaking men of action who offered her solutions along the lines of her own instincts. So when
Stepping Stones
was presented to her by Hoskyns and Strauss, over a four-hour meeting in her office in the House of Commons on 24 November 1977, she was enthusiastic. ‘It’s the best thing we’ve had for many years’,
³
she told Willie Whitelaw. But the paper was a long way from being accepted as Tory policy.

Although a
Stepping Stones
steering group was set up, its main achievement was to steer the radical ideas of Hoskyns and Strauss into a brick wall. This impasse came because of skilful opposition from Jim Prior, Peter Thorneycroft, Chris Patten, Ian Gilmour and other doves. The paper would probably have sunk without trace but for the ‘winter of discontent’. That gave Margaret Thatcher the opportunity to resurrect the
Stepping Stones
strategy and to seize on one of its principal recommendations, which Hoskyns, a former army officer, called, ‘The charge of the Light Brigade approach’.
⁴
This was the tactic of presenting
the Callaghan government’s appeasement of the unions as the major reason why the Labour Party should not be re-elected. Instead of being on the defensive about the Conservatives’ inability to govern because of fear of union conflict, Margaret Thatcher went on the attack with her willingness to fight the dragon of union power. It was a bold move. Its timing was in tune with the mood of the electorate, even if her message made her senior colleagues uneasy.

This adoption of the
Stepping Stones
agenda brought John Hoskyns and his confrontational ideas back into fashion. After the general election of 1979 he was appointed Head of the Prime Minister’s Policy Unit at Number 10. His arrival in what should have been a position of great influence meant that a beach-head for the strategy of challenging the unions had been established at the heart of the government’s policy-making.

The strategy remained marooned on the beach for many months. This was largely due to Jim Prior whose even gentler approach in government as Employment Secretary meant that little was done to tackle the abuses of union power. As a result the Thatcher government’s first Employment Act of 1980 was modest in its scope. It restricted the closed shop, but did not ban it. It outlawed secondary picketing, but not secondary strike action. It encouraged secret ballots, but did not make them compulsory. Although the Prime Minister publicly defended the legislation as ‘modest and sensible’
⁵
and ‘a very good start’
⁶
her real views were quite different. She became fed up with Prior, who she felt was thwarting the
Stepping Stones
agenda at every turn. So she moved her Employment Secretary to Northern Ireland, replacing him with Norman Tebbit, whose Employment Act of 1982 widened the scope of reform by making unions liable for damages.

During her first term, Margaret Thatcher had some successes in her dealings with the unions and one major failure. Pay demands became more realistic. Fear of unemployment after the 1981 Budget created a more moderate wage-bargaining climate. Some strikes, notably by train drivers and by health-service workers, ended in stalemate or even humiliation for their organisers. But the atmospherics of industrial relations remained tense. This was because of one elephant, which was not only in the room – it trumpeted its early defeat on the government. The elephant was the National Union of Mineworkers (NUM).

The NUM was Britain’s most powerful and most militant union. In the first eighteen months of the Conservative government it won pay rises for its
members of 30 per cent. In 1981 it threatened to strike over a proposal by the National Coal Board to close twenty-three uneconomic pits. The Prime Minister wanted to back the National Coal Board. But she had to make a swift U-turn. She discovered that coal stocks at power stations were much lower than expected.

In various cabinet committees Margaret Thatcher fulminated against Sir Derek Ezra, the National Coal Board Chairman, for failing to move sufficient quantities of coal from the pitheads to the electricity generating stations. She was almost as critical of her first Energy Secretary, David Howell. It was hardly the Prime Minister’s fault that the coal was in the wrong place, but she took it personally. Yet in her despair she was decisive. When she learned that the country would only have thirteen weeks of electricity supplies before coal stocks ran out and the nation would be facing power cuts, she knew she was beaten. To her chagrin, she had to retreat before the battle started. ‘Bring it to an end, David, make the necessary concessions’, she instructed Howell.
⁷
They were expensive. The government had to find £300 million in extra subsidies to keep the twenty-three loss-making pits open. It was a major reversal for the Prime Minister’s strategy to reform the financing of the nationalised industries. She had been defeated by the NUM.

The miners exulted in their easy victory. Amidst their crowing they elected, as their new NUM President, Arthur Scargill. In contrast to his moderate predecessor Joe Gormley, Scargill was a Marxist militant whose skill as a rabble- rousing orator was equalled by his determination to overthrow the elected government. He declared this openly. ‘A fight-back against this Government’s policies will inevitably take place outside rather than inside Parliament’, Scargill told the annual conference of the National Union of Mineworkers in Perth. ‘Extra-parliamentary action will be the only course open to the working class and the Labour movement.’
⁸

Alerted to Arthur Scargill’s intentions, Margaret Thatcher was certain that she would have to face a miners’ strike. Even though John Hoskyns left her team at No. 10 in disillusionment in early 1981, she revived his
Stepping Stones
credo that confrontation was inevitable. So she prepared for it with great care, starting with an instruction to her new Energy Secretary, Nigel Lawson, to increase the movement of coal from the pitheads to the power stations. This was a wise move, because the miners’ strike of 1984 was destined to become the turning point in the unresolved struggle between union power and government authority.

ARTHUR SCARGILL’S CHALLENGE

Margaret Thatcher not only saw the miners’ strike coming, she regarded it as an unavoidable clash between hard-left militancy and common-sense economics. She was right. Arthur Scargill was an ideological extremist who wanted the strike for political reasons, leading it with contempt for the democratic rules of his own union and disregard for the interests of his members. Short of bringing General Galtieri over from Argentina to lead the NUM, there could not have been a more obtuse and stubborn opponent for Margaret Thatcher in her battle against the abuses of union power. But even if the fight was essential, it was a sad one with melancholy consequences and many lasting scars.

Having lost her opening battle with the NUM, the Prime Minister was determined to win the longer-term war. Her first dispositions involved making three strategic appointments that showed her prescience about the power struggle that was bound to come.

The day after the 1983 general election, she chose Peter Walker to be her Secretary of State for Energy. He was not her cup of tea politically. As a leading wet, he had opposed most of her economic policy and was a notorious leaker against her, principally to his friend Mark Schreiber of
The Economist
. But Walker had skills the Prime Minister needed – bustling energy, administrative drive and a capacity for ruthless media management. She told him on the day of his appointment that a Scargill-led strike was to be expected, and that his talent as ‘a skilled communicator’ would be useful in retaining public support for the government’s case when the NUM militants went on the attack.
⁹

The government’s economic case was overwhelming. The coal industry was losing over £200 million a year in 1984. Three-quarters of its pits were uneconomic, and many of them would have to be closed.

To keep herself fully briefed on what was happening in and around the country’s coalmines, Margaret Thatcher reached out to sources wider than the management of the National Coal Board. In January 1984, she asked to see two MPs who were the only Conservatives in the House of Commons whose constituencies covered an entire coalfield. They were Peter Rees (Dover and Deal), and myself (Thanet South). Between us, we represented the 3,000 strong workforce of the small but ultra-militant Kent pits.

The Prime Minister was surprised to learn that the Kent miners were such aggressive supporters of Arthur Scargill that there was no hope of persuading
them to act or vote moderately. She wanted answers to detailed questions about where and how the coal they produced was being delivered. When I said that most of it seemed to be piling up at the pithead, which was unnecessary because Richborough Power Station – only six miles away – had plenty of spare storage capacity, Margaret Thatcher’s eyes gleamed. ‘We will make sure that Walter Marshall gets that information,’ she said to her Private Secretary, ‘won’t we?’
¹⁰

This was an interesting intervention by the Prime Minister. Sir Walter Marshall was the new Chairman of the Central Electricity Generating Board (CEGB). He had become No. 10’s favourite nationalised industry leader after a successful stint as head of the UK Energy Authority. Margaret Thatcher liked his ‘get up and go’ spirit, so she promoted him to the Chairmanship of the CEGB. She gave him instructions to keep the power stations fully stocked with coal, diesel fuels and industry chemicals in case a strike was called by the NUM.

Marshall rose to the challenge and performed his task with vigour. He was an inspired choice by the Prime Minister, and a key player in the eventual defeat of the strike. It is interesting that she was in touch with him about as detailed a matter as coal deliveries to Richborough Power Station three months before the strike was called.

When Peter Rees and I were fielding a barrage of questions from Margaret Thatcher about the Kent miners, I told her that the Betteshanger pit near Dover was producing the most expensive coal in Britain, since its losses were more than £400 per ton.

She sounded shocked. ‘That can’t go on’, she said. ‘You should go and see Ian MacGregor and make sure he is aware of it. And you should invite him to speak to that Conservative Philosophy Group of yours as soon as possible.’
¹¹

Perhaps that response indicated that Margaret Thatcher had early doubts about the communication skills of her third key appointee for the battle with Scargill – the new Chairman of the National Coal Board. Sir Ian MacGregor was a seventy-year-old Scottish-born American industrialist with a reputation for toughness.
^*
During his career in the United States his track record included
breaking a two-year strike by the United Mineworkers. In the UK, he had served for two years as Chairman of British Steel, where he had converted huge losses into profit, but at a cost of making half the workforce redundant. This earned him the soubriquet ‘Mac the Knife’.
¹²