The Government Communications Headquarters (GCHQ) at Cheltenham was, for technological reasons, an ever more important part of Britain’s intelligence capacity. By the end of the 1970s, its glorious wartime role of decrypting Nazi signals at Bletchley Park had been partially disclosed. It was also (and is even more so today) central to the relationship of intelligence co-operation and trust with the United States which had begun during the Second World War and continued in the Cold War. GCHQ’s operations were secret, but it was not, in a formal sense, part of the secret services at that time. Its staff were members of the general Civil Service and free to join trade unions accordingly. The Security Service (MI5) and the Secret Intelligence Service (SIS) stood apart from the general Civil Service. Their staff were specifically denied the right to join a union because unions, being national organizations reaching beyond those services, could not be restrained by the necessary rules of secrecy. MI5 and SIS staff were not permitted to strike.
The union presence at GCHQ worried Mrs Thatcher. During the ‘Winter of Discontent’ in early 1979, under the Labour government which she was to defeat that May, strikes by unionized staff had seriously disrupted GCHQ’s work. The same happened in the Civil Service strike of 1981. One senior national union official crowed in the media: ‘This [the GCHQ signals research station at Culmhead in Somerset] is the most crucial station we have hit so far. We are going to hit this Department “as hard as we can”.’1 Other union boasts specifically proclaimed how they had damaged Britain’s secret communications surveillance network nationally and internationally. The unions’ motivation was not Moscow-inspired subversion, but part of their desire to make life as difficult as possible for the government during the strike, right across the Civil Service. They probably did not understand the depth of alarm their actions provoked. The Director of GCHQ, Sir Brian Tovey, told staff that the strikes meant the services were losing confidence in GCHQ’s ability to provide early warning of Soviet intentions. He added that the US National Security Agency (NSA) was also alarmed.2 To Mrs Thatcher, he claimed that if not guaranteed a reliable supply of SIGINT (signals intelligence) by the British, the Americans would ‘insist on supplying personnel’ to man British stations.3
Mrs Thatcher was furious with the Civil Service unions. ‘There was a sense of betrayal,’ recalled Robert Armstrong. ‘She never forgave them.’4 She was a passionate believer in upholding national security and in the importance of the Anglo-American relationship. It was intolerable to her that these things could be put at risk by displays of union muscle. She was the first prime minister since Winston Churchill in 1941 to consider GCHQ worth visiting. She also held strong, old-fashioned views about the value of secrecy in security matters.* She wanted to prevent a repetition of such strikes by banning union membership at Cheltenham, and was supported in this by the top management of GCHQ. Although there is no evidence that the United States ever suggested a union ban to the British government or to her personally, the US agencies had certainly made known their anxieties about the disruption. By acting firmly, Mrs Thatcher believed, she would be serving the interests of the alliance as well as the direct national interest.
Change was complicated because of GCHQ’s status and funding. It was part of what was called ‘the hide’, the device by which its budget was concealed inside those of conventional departments. It had no formal national security status. Only by ‘avowing’ GCHQ’s SIGINT activities for the first time could the government justify its removal from the general Civil Service. As a formally secret organization it could then be excepted from the Employment Protection Act and its union rights removed. So the paradox was that, for GCHQ to be classified as secret, the nature of its work had to be made public. Avowal would, however, have tricky consequences for SIS, which was, at that time, totally secret and not avowed. Plans were drawn up, but the Falklands War pushed them to one side. Besides, Mrs Thatcher was conflicted between her desire to delay avowal and her desire to ban unions. ‘I insisted that we play GCHQ long.’5
An unrelated event changed matters. In April 1982, a GCHQ employee, Geoffrey Prime, was arrested for sexual assaults on young girls. It then emerged that he had also been passing SIGINT secrets to the Soviet Union. He was later convicted of both offences and sentenced to thirty-five years in prison. There was no trade union issue in Prime’s case, but his conviction brought further public attention to the work of GCHQ. In November that year, Mrs Thatcher explained the Prime case to the House of Commons and in doing so effectively ‘avowed’ GCHQ’s work.6 Her way now lay open, if she won, to make changes. She intended this, and asked officials to put it in hand.*
The task fell to Robert Armstrong. He was, recalled Lord Gowrie,† who was Civil Service minister at the time, ‘very iffy about the whole thing’.7 Although happy in principle to execute Mrs Thatcher’s aims, he was anxious about the means. As head of the Home Civil Service, Armstrong saw his job as a pacific one, and ‘wanted the usual channels to calm it all down. She, by contrast, was on a Spitfire raid, propellers whizzing.’8 In his many memos to her on the subject, Armstrong tended to insert caveats and suggest compromises. Mrs Thatcher would scribble crossly in the margins. When he told her, for instance, that ‘in general civil servants are expressly encouraged to join a union’, she wrote, ‘why? By whom?’9 No one, however, including Armstrong, advised Mrs Thatcher not to try to ban unions at GCHQ. Just before Christmas 1983, Mrs Thatcher and those ministers directly involved decided to put their plan into effect in the new year.
Because of the demands of secrecy, there was no consultation in advance with those affected. The GCHQ staff and the trade unions were informed only minutes before Geoffrey Howe* announced the union ban to the Commons on 25 January 1984. The ban, Howe told the House, would be compensated by a one-off payment of £1,000 to each employee.10 Robert Armstrong gave the news to the trade unions in person. There was ‘outrage’, he reported to Mrs Thatcher, and they ‘protested bitterly’ at not being consulted. They described the £1,000 as a ‘bribe’; one official uttered the words ‘Judas Iscariot’.11
In GCHQ itself, there was some anger at the ban and the payment among unionized members of staff. ‘She thinks we can be bought,’ said critics. If so, perhaps she was right: in the first twenty-four hours, 460 employees accepted the new status and the money, and only two rejected it. Twenty-four hours later, the number of acceptances had doubled and that of rejections had halved (since one of the two who had refused changed his mind).12 Tony Comer, then a young GCHQ employee and later the official historian of the organization, recalled that significant numbers of the staff, who were appreciative of the benefits in terms and conditions of employment that trade union membership gave them, were nevertheless ‘uncomfortable with the danger of their work in GCHQ being compromised to support somebody else’s agenda’.13
The press and public reaction to the shock of the announcement was mostly negative. Some thought the measure was a slur on the loyalty of trade unions to the nation, and were deeply offended; others thought it too draconian. Many more simply thought it was being mishandled. The Cabinet, which, because of her worries about secrecy, Mrs Thatcher had not consulted, was grumpy at having been kept in the dark. ‘If she had taken things to Cabinet,’ commented Robin Butler, ‘there might have been wiser heads to look at the problem.’14 Always adroit in attack, Jim Callaghan told a TUC protest rally that although Mrs Thatcher was known for her interest in Victorian virtues, ‘She seems also to have picked up some Victorian vices. For this arbitrary action is no better than that of a nineteenth-century mill-owner.’15
The consultation which, in a non-secret organization, would have taken place before the announcement, now happened after it. Mrs Thatcher did not like this but, given the public indignation, could not prevent it. Geoffrey Howe put Robert Armstrong in charge. Armstrong, who conducted painstaking discussions with the Civil Service unions personally, found that, for all their rage, the unions were ‘desperate about it. They would go to almost any lengths to k
eep their foot in the door.’16 They offered to make no-strike agreements and to let negotiations be conducted by security-cleared union officials in Cheltenham rather than by their national officers. He told Mrs Thatcher that the ‘relatively moderate men – the officials with whom I am dealing – heartily wish they had not [caused disruption in 1981] … There is a case for giving the unions a chance.’17
Mrs Thatcher did not think so. She was not disposed to accept the unions’ concessions, but she did agree to Armstrong’s request that she see their leaders, including Len Murray,* the general secretary of the TUC. She went into the meeting fortified by a note from Robin Butler written the night before:18
Close of play score at Cheltenham
Acceptances 4260 60.5 per cent
Refusals 13
She was polite – ‘She did not doubt the dedication of individual staff’ – but she gave no ground on the ‘inherent conflict of loyalty’19 created by the needs of national security on the one hand and the nature of the trade union structure on the other. For Mrs Thatcher, the strike-induced disruption had been the symptom of the problem. She now wished to tackle the cause. The union leaders vented their wrath. Murray accused her of being ‘dismissive of trade unions generally’. He regarded this meeting as the final signal that the closeness between government and the unions which had been the dominant feature of his era and his career was dead. He resigned from his job a couple of months later. ‘For him,’ Armstrong recalled, ‘it was the last straw.’20
Although she had no personal animus against the amiable and decent Murray, Mrs Thatcher was not moved by the unions’ protests. In the same meeting, Geoffrey Howe had explained that the GCHQ ban was a special case, not a criticism of unions as such. Mrs Thatcher did not endorse this view. When Howe sent her the draft of his speech in the debate on the subject to be held four days later, he included a sentence saying he did not want ‘to cast doubt on the loyalty of the staff at GCHQ’. After ‘loyalty of’, Mrs Thatcher inserted ‘individual members’.21† Although there is no evidence that she thought the unions were traitors working for the Soviet Union, she did indeed, after what had happened in 1981, doubt their loyalty to GCHQ. When he came to deliver his speech in Parliament, Howe ignored her inserted words and stuck to his original text. Although he was not outspoken with her about it at the time, he later regarded the GCHQ saga as an example of ‘one of Margaret’s most tragic failings: her inability to appreciate, still less accommodate, somebody else’s patriotism’.22 In his negotiations, Armstrong believed he achieved ‘97 per cent’ of what Mrs Thatcher wanted. Howe would have been content with this. Mrs Thatcher was not. ‘She wanted to get the unions out of GCHQ hook, line and sinker,’ Armstrong recalled. ‘She wanted everything.’23 Numerically at least, she very nearly got it. By 2 March, 6,616 employees, almost 95 per cent of the Cheltenham staff, had accepted the new arrangements and only 45 had refused.
She also carried her point. She would not accept the so-called ‘card in the pocket’ solution, eventually conceded by the unions, which would have allowed GCHQ staff to remain members of national unions, without those unions having any negotiating rights at GCHQ. There could be a staff association, she agreed, but not one with any right to industrial action or any link with an exterior trade union. Once GCHQ’s funding had been transferred to the ‘secret vote’, hidden from public gaze, it was easier to provide its staff with better pay and conditions. Mrs Thatcher wanted to make sure the staff positively benefited from not having a union: ‘I saw to it that they did a damn sight better with the staff association than they had ever done with a Trade Union.’24
Throughout the almost year-long processes of consultation, parliamentary and public argument, and the judicial review which the government lost on appeal in July* but then won in the House of Lords in December,† Mrs Thatcher carefully worked through all the suggestions Armstrong made, but nevertheless resisted any compromise. In this, she was strongly supported by her principal private secretary, Robin Butler, who, in Lord Gowrie’s phrase, was ‘hawkier than thou’.25 He often wrote on the margin of memos from Armstrong, urging Mrs Thatcher not to be lured into anything that could be represented as a climbdown, and he composed a memo, enlisting Bernard Ingham’s support, which set out the dangers. ‘I probably thought Robert was too chummy with the Civil Service unions,’ Butler recalled.26
Butler was also conscious of the wider accusations of drift from which Mrs Thatcher’s government was suffering at the time. ‘If you are not resolute about this,’ he wrote to her, ‘it will be taken as proof positive that you are not as resolute in your second Administration as you were in your first.’ If she weakened now, ‘the unions will have the Government over a barrel.’27 ‘There goes someone one who wants to be the next Cabinet Secretary!’ Gowrie remembered thinking as he saw Butler at work;28* but if one looks at the issue from his boss’s point of view, Butler was surely right. If she had blinked, she would not only have lost the first union battle of her second term which, up to then, she had been winning: she would also have disabled herself for the much bigger battles to come. The fact that an ambitious civil servant could see this showed how Mrs Thatcher really had got the better of establishment doubters by winning her second general election. ‘The major mandarin resistance to her had gone,’ recalled her private secretary Tim Flesher. ‘GCHQ was the issue that symbolized this. It may have been a battle which was disproportionate, but once she got into this fight, she had to win it.’29 Butler understood how she was changing everything. Armstrong either did not, or more likely did, but did not like it.
Six weeks after announcing the GCHQ union ban, and long before the issue was settled, Mrs Thatcher found herself engaged in the most titanic struggle with a single trade union ever known in Britain.
In February 1981 (see Volume I, Chapter 19), Mrs Thatcher had surrendered to the National Union of Mineworkers. In order to avert a strike for which her government was not ready, she had dropped the proposed programme of pit closures designed to put the coal industry on an economic footing. On that day of defeat, Bernard Ingham wrote her a rueful note about the assault he had suffered from the press lobby that morning. The journalists, he told her, had tried to establish that there had been ‘a massive U-turn … without knowing the financial cost’. His response, he said, had to been to explain that ‘no Government ever gets from A – B in a straight line.’30 As he well knew, Ingham was making the best of an extremely bad job, but his answer was accurate. Mrs Thatcher did indeed intend to move from A to B. In her mind, the increasing government subsidies demanded by the loss-making coal industry (which in 1983–4 reached £1.3 billion) left her little choice. By March 1984, she was ready.
The one merit of her 1981 capitulation was that it had been swift. Rather than drawing out a struggle she could not win, and thus suffering the fate of Edward Heath in February 1974, she had surrendered at once. ‘I hugely admired the way she cut and ran very quickly in 1981,’ Butler recalled. ‘She reckoned she couldn’t cut and run again.’31 In almost every way – for her economic transformation of Britain and her reform of the trade unions, for her party’s need to exorcize the ghosts of 1972 and 1974, for her personal pride and her very survival in office – it was essential that she should not be beaten again by the NUM. Mrs Thatcher did not, at that point, know how or – even more difficult – when a national coal strike would come. All she knew was that it would be decisive for her premiership. And so, unusually for a woman who tended to act more by instinct than strategy, Mrs Thatcher started to plan.
However complicated the politics, the plan itself was simple. What mattered most was called ‘endurance’: there had to be enough coal to survive a complete shut-down of production. Since nearly three-quarters of British coal was used in electricity generation, this meant, above all, having enough of it stockpiled both at pitheads and at power stations. It also meant being able to transport those stocks when and where needed. This, in turn, demanded trade union laws which restricted the ability of
pickets to block coal movement, and police with enough authority and resources to enforce both these and the common law. Although many of the requirements for endurance were highly technical – Mrs Thatcher delighted, as a scientist, in showing off her knowledge of the ancillary chemicals, such as carbon dioxide to cool the turbines, required to keep the power stations functioning – it was really a question of organization and of political will.
In 1981, despite Mrs Thatcher’s efforts to prod the lethargic Whitehall machine into action, coal supplies had been sufficient only for six weeks. This meant that no government could withstand a strike: the lights would soon start to go out. After this debacle, the government realized that endurance of at least six months was necessary. From July 1981, the civil servant in charge of putting things to rights was Peter Gregson* at the Cabinet Office who, as a young private secretary to Edward Heath, had witnessed and felt ‘deep depression’32 at the first capitulation to the NUM in 1972. Gregson believed that better strategic oversight was needed to prepare for a strike. He insisted that government tactics over public sector pay should be linked with endurance. He chaired an ‘official group’ on strike preparation in the coal industry, and was also in charge of the Cabinet Office’s work on trade union reform.
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