The Downing Street Years

by Margaret Thatcher

  The Community heads of government met in the magnificent Zappeion Hall, a classical Greek building adapted to the needs of a modern conference centre. At the first session of the Council that afternoon I was sitting opposite President Mitterrand and Chancellor Kohl. I noticed that whereas my own table was covered with piles of heavily annotated briefing on different complex agricultural and financial issues, no such encumbrance appeared in front of my French and German counterparts. This doubtless made for an impression of appropriately Olympian detachment, but it also suggested that they had not mastered the detail. And this turned out to be the case. Throughout the meeting Chancellor Kohl seemed unwilling or unable to make much effective contribution. Worse, President Mitterrand appeared not only badly briefed on the issues but strangely — I think genuinely — misinformed about his own Government’ position, as it had previously been set out by French ministers and officials.

  The Greek Presidency did not assist much either. Mr Papandreou always proved remarkably effective in gaining Community subsidies for Greece but he was less skilful in his present role as President of the European Council. As his earlier letter to me had proposed, he insisted on trying to reach agreement on agriculture before moving on to the question of finance and the British budget contribution. Obviously, it would have been made better sense to face the Community countries with the financial realities first and then deal with the agricultural issues, from which so much of the financial problem derived and on which different countries had sharply opposing national interests. And we never seemed to get by without a tear-jerking homily on the predicament of Ireland from the Irish Prime Minister, Dr Garret FitzGerald, who was determined if he could to exempt his country from the disciplines on agricultural spending. I made it clear that any preferential treatment for the Republic would have to be matched by similar treatment for Northern Ireland. The first day was more or less a write-off.

  I was, therefore, already pessimistic by the time I returned that night to the British Ambassador’ Residence to discuss with my officials how we should conduct ourselves the following day (Monday). But it was only on the Monday that it became obvious that the summit would indeed fail. When the Council met, to my astonishment President Mitterrand made it clear that France’ position on the budget had completely changed. France was no longer prepared to support us in pressing for a long-term settlement of the British budget problem. In repeated interjections, I said that I would not agree to an increase in the Community’ ‘own resources’ unless spending on the CAP was contained and decreased as a share of the total budget and unless member states’ contributions were fair and in line with the ability to pay. The argument continued, but I was clearly getting nowhere.

  On Tuesday I had a working breakfast with President Mitterrand. We were so far apart that there was no point in spending much time discussing Community issues at all and we largely concentrated instead on the Lebanon. The French President seemed blissfully unaware of the damage his own turnabout had done. He said jokingly that unless we demonstrated that discussions between Britain and France were continuing, the press would soon be talking about a return to the Hundred Years’ War. So in what I hoped was a suitably nonbelligerent way I told him how his attitude at the Council had taken me by surprise, given the fact that I was going along with the proposals on the budget which the French Finance minister, one M. Jacques Delors, had been advancing. The President asked me precisely what I meant and I explained. But I received no very satisfactory or clear response.

  Where we did see eye to eye — at least in private — was about Germany. I said that even though the Germans were willing to be generous because they received other political benefits from the Community, a new generation of Germans might arise who would refuse to make such a large contribution. This would risk a revival of German neutralism — a temptation which, as President Mitterrand rightly said, was already present.

  The meeting had been an amicable one and I tried to keep the atmosphere relatively friendly after the Council broke up, as in press interviews I avoided being too harsh about France’ performance. After all, M. Mitterrand was to be the next President of the Council and so it would fall to him to chair the crucial meetings as we at last approached the time when the Community’ money ran out. It did cross my mind that he might have wished to delay a settlement until he could take credit for it in his own presidency.

  No communiqué was issued at the end of the Athens Council: we had had no time in plenary sessions to discuss any of the wider international issues and agree a line on them. The Council was widely and accurately described as a fiasco. But my frustration was diminished by the fact that I knew that time was on my side.

  * Until 1982 the Canadian Constitution was still based on British Acts of Parliament, which only Westminster could amend, though of course in every practical sense Canada has long been an independent state. In that year at Canadian request we legislated to ‘patriate’ the constitution and the process of amendment, passing it over to full Canadian control.

  * See pp. 451–3.

  * Monetary Compensatory Amounts (MCAs) were a system of border taxes and levies on CAP products.

  CHAPTER XIII

  Mr Scargill’s Insurrection

  The background to and course of the year-long miners’ strike of 1984 — 1985

  PRELUDE

  The 1983 general election result was the single most devastating defeat ever inflicted upon democratic socialism in Britain. After being defeated on a manifesto that was the most candid statement of socialist aims ever made in this country, the Left could never again credibly claim popular appeal for their programme of massive nationalization, hugely increased public spending, greater trade union power and unilateral nuclear disarmament. But there was also undemocratic socialism, and it too would need to be beaten. I had never had any doubt about the true aim of the hard Left: they were revolutionaries who sought to impose a Marxist system on Britain whatever the means and whatever the cost. Many of them made no effort to conceal their purpose. For them the institutions of democracy were no more than tiresome obstacles on the long march to a Marxist Utopia. While the electoral battle was still being fought their hands had been tied by the need to woo more moderate opinion, but in the aftermath of defeat they were free from constraint and thirsting for battle on their own terms.

  The hard Left’s power was entrenched in three institutions: the Labour Party, local government and the trade unions. From all three bases they now proceeded to challenge our renewed mandate. Predictably, it was the National Union of Mineworkers (NUM), led by its Marxist president, Arthur Scargill, who were destined to provide the shock troops for the Left’s attack. The intention was plain. Within a month of the 1983 election Mr Scargill was saying openly that he did not ‘accept that we are landed for the next four years with this Government’. And this would be an attack directed not only against the Government, but against anyone and anything standing in the way of the Left, including fellow miners and their families, the police, the courts, the rule of law and Parliament itself.

  After the experience of the Conservative Government of 1970 — 74 I hardly doubted that one day we would have to face another miners’ strike. From the time of Mr Scargill’s election to the leadership of the NUM in 1981 I knew it. I had no desire for such a strike. There was no economic rationale for it. The National Coal Board (NCB), the Government and the great majority of miners wanted a thriving, successful, competitive coal industry. But history intertwined with myth seemed to have made coal mining in Britain a special case: it had become an industry where reason simply did not apply. Britain’s industrial revolution was to a large extent based on the easy availability of coal. At the industry’s height on the eve of the First World War it employed more than a million men to work over 3,000 mines. Production was 292 million tons. Thereafter decline was continuous, and relations between miners and owners frequently bitter. Conflict in the coal industry precipitated Britain’s only general strike in 1926. (Prefigu
ring later developments, the miners’ union split during the year-long coal strike that followed the general strike, and a separate union was set up in Nottinghamshire.) Successive governments between the wars found themselves dragged ever deeper into the task of rationalizing and regulating the industry, and in 1946 the post-war Labour Government finally nationalized it outright. By that time production was down to 187 million tons at 980 pits, with a workforce of just over 700,000.

  Government now began setting targets for coal production and investment in a series of documents inaugurated by the ‘Plan for Coal’ in 1950. These consistently overestimated both the demand for coal and the prospects for improvements in productivity within the industry. The only targets that were met were those for investment. Public money was poured in, but two problems proved insoluble: overcapacity and union resistance to the closure of uneconomic pits. As the industry declined miners relied more and more on industrial muscle to keep themselves in work.

  By the 1970s the coal mining industry had come to symbolize every thing that was wrong with Britain. In February 1972 mass pickets led by Arthur Scargill forced the closure of the Saltley Coke Depot in Birmingham by sheer weight of numbers. It was a frightening demonstration of the impotence of the police in the face of such disorder. The fall of Ted Heath’s Government after a general election precipitated by the 1973 — 4 miners’ strike lent substance to the myth that the NUM had the power to make or break British Governments, or at the very least the power to veto any policy threatening their interests by preventing coal getting to the power stations.

  I have already described the threat of a miners’ strike which we faced in February 1981 and the way in which this was averted.* From then on it was really only a question of time. Would we be sufficiently prepared to win the fight when the inevitable challenge came? A milestone was reached when Mr Scargill won the union presidency at the end of 1981 and the power of the NUM and the fear it inspired came into the hands of those whose objectives were openly political.

  It fell mainly to Nigel Lawson who became Secretary of State for Energy in September 1981 to build up — steadily and unprovocatively — the stocks of coal which would allow the country to endure a coal strike. We were to hear a lot of the word ‘endurance’ over the next few months. To maximize endurance it was vital that coal stocks be in place at the power stations and not at the pit heads, from which miners’ pickets could make movement impossible. But coal stocks were not the only element determining power station endurance. Some Central Electricity Generating Board (CEGB) power stations were oil fired. Ordinarily they were used only part of the time, to meet peak demand, but if needed they could be run continuously to help meet the ‘base load’ — that element of electricity demand that is more or less constant. ‘Oilburn’ was expensive, but would add significantly to the system’s ability to withstand a strike. An additional advantage was that oil supplies to the power stations were relatively secure. Nuclear-powered stations, providing about 14 per cent of supply, were mostly some distance away from the coal fields and of course their primary fuel supply was also secure. Over the next few years more Advanced Gas-cooled Reactors (AGRs) would be coming on stream and would steadily reduce our dependence on coal-fired power. We were still building a cross-Channel link which would allow us to buy power from France, though we already had a link in operation between the English and Scottish systems (‘the Scottish interconnector’). We also did our best to encourage industry to hold more stocks.

  Danger began to loom in the autumn of 1983. Peter Walker was now Secretary of State for Energy, a job to which I had appointed him after the general election in June. As he had shown at Agriculture in our first Parliament, he was a tough negotiator. He was also a skilled communicator, something which I knew would be important if we were to retain public support in the coal strike which the militants would some day force upon us. Peter regularly telephoned newspaper editors in person to put over our case. This was never my preferred way, but I recognized its effectiveness during the strike. Unfortunately, Peter Walker never really got on with Ian MacGregor, and this sometimes created tensions.

  Ian MacGregor took over as Chairman of the NCB on 1 September. He had been an excellent Chairman of the British Steel Corporation, turning the Corporation around after the damaging three-month steel strike in 1980. If Britain’s coal industry was ever to become a successful business rather than a system of outdoor relief, he had the experience and determination to make this happen. Unlike the militant miners’ leaders, Ian MacGregor genuinely wanted to see a thriving coal industry making good use of investment, technology and human resources. Perhaps his greatest quality was courage. Within the NCB itself he often found himself surrounded by people who had made their careers in an atmosphere of appeasement and collaboration with the NUM and who greatly resented the changed atmosphere he brought with him. Yet it transpired that Ian MacGregor was strangely lacking in guile. He was quite used to dealing with financial difficulties and hard bargaining. But he had no experience of dealing with trade union leaders intent on using the process of negotiation to score political points. Time and again he and his colleagues were outmanoeuvred by Arthur Scargill and the NUM leadership. During the strike Peter Walker and I followed with constant anxiety every phase of the battle for public opinion. The NUM leadership used every device to distort the truth and misinform the public and their own members.

  On Friday 21 October 1983 an NUM delegate conference voted for a ban on overtime in protest at the Board’s 5.2 per cent pay offer and at prospective pit closures. In itself, with coal stocks as high as they were, an overtime ban was unlikely to have much effect. It probably had an ulterior purpose: to increase tension among the miners and so make them more prepared for a strike when the NUM leadership thought that one could successfully be engineered. We always knew that it was pit closures that were more likely to ignite a strike than a dispute about pay. The case for closures on economic grounds remained overwhelming. Even Labour had acknowledged it: thirty-two pits had been closed under the Labour Government between 1974 and 1979. Mr Scargill, however, denied the economic case for closure. His line was that no pit should be closed unless it was physically exhausted. Indeed, he denied the existence of ‘uneconomic pits’: in his view a pit that made a loss — and there were many — simply required further investment. Called to give evidence before a Select Committee, he had been asked whether there was any level of loss that he would deem intolerable. He replied memorably: ‘As far as I am concerned, the loss is without limit.’

  During the autumn and winter of 1983 — 4 Ian MacGregor formulated his plans. At that time manpower in the industry was 202,000. The Monopolies and Mergers Commission had produced a report into the coal industry in 1983 which showed that some 75 per cent of the pits were making a loss. Faced with this, Mr MacGregor began with the aim of bringing the industry to break-even point by 1988. In September 1983 he told Government that he intended to cut the workforce by some 64,000 over three years, reducing capacity by 25 million tons. There was, though, never any secret ‘hit list’ of pits due for closure: decisions as to which pits were to be closed would be made on a pit-by-pit basis under the existing colliery review procedure. He came back to us in December 1983 indicating that he had decided to accelerate the programme, aiming to cut the workforce by 44,000 over the next two years; to achieve this he urged us to extend the existing redundancy scheme to include miners under the age of fifty. The terms we agreed in January 1984 were extremely generous: £1,000 for each year of service, paid as a lump sum, the scheme to operate for two years only, so that a man who had been in the pits all his working life would get over £30,000. In the coming year, 1984 — 5, Mr MacGregor proposed 20,000 redundancies. We were confident that this figure could be achieved without anyone being forced to leave the industry against their will. Around twenty pits would close and annual capacity would be reduced by 4 million tons a year.

  As discussions continued accusations began to fly about a ‘hit list’
of pits. The rhetoric of the NUM leadership took ever greater leave of reality — in particular, of the economic reality that the industry was receiving £1.3 billion of subsidies from the taxpayer in 1983 — 4. It sounded as if Mr Scargill was preparing to lead his troops into battle. At the end of February there was an early intimation of the violence which would characterize the strike when Ian MacGregor — then 70 years old — was knocked to the ground at a Northumberland colliery by demonstrating miners. I was shocked and wrote to convey my sympathy. Far worse was to come.

  Obviously we realized that a strike was always possible, but we doubted whether it would happen before the end of 1984, when winter set in and the demand for coal was at its annual peak. To begin a strike in the spring would be the worst possible tactic for the NUM. But this was a point on which Mr Scargill misled his own members: in February he was making wild claims, saying that the CEGB had only eight weeks of coal stocks. In fact stocks were far higher — something that could have been deduced from figures in the public domain. However, the union had a tradition of balloting its members before strike action took place, and there was good reason to think that Mr Scargill would not get the necessary majority (55 per cent) to call a national strike at any point in the immediate future. Since he had become President the NUM membership had voted against strike action three times already. We could not have foreseen the desperate and self-destructive tactics he chose to adopt.

  THE STRIKE BEGINS

  On Thursday 1 March the NCB announced the closure of the Yorkshire colliery of Cortonwood. The announcement was not particularly well handled by the local NCB: the impression was given that the colliery review procedure was being by-passed, whereas in fact the NCB had had no such intention. But the executive of the radical Yorkshire area of the NUM — Mr Scargill’s home ground — announced a strike in protest at the decision, relying on a local ballot held two years previously to provide authority for their action.