Release of MT's private files for 1981 - (1) Politics & the economy

Summary: What is being released?

Alongside her official papers as PM - stored in an office close to the Cabinet Room modestly titled "Confidential Filing" - MT kept a collection of personal documents at her No.10 flat. They included the aide memoires she wrote from time to time (notably on the Falklands War) as well as personal letters from friends and close advisers, and mementoes, such as her extensive collection of menus from lunches with presidents and grand official dinners. By the time she left office she had filled five or six mahogany filing cabinets.

These papers now form the core of her archive at the Churchill Archive Centre in Cambridge. And there is much more besides, because in fact No.10 comprises a whole collection of offices much of whose work has been archived in Cambridge. While key policy documents are handled by the Private Office (and become part of the National Archives in Kew), Cambridge now has the filing from her Political Office (which handled party business and was paid for by the party), the Press Office (including copies of off-the-record Lobby Briefings never previously kept), and the Policy Unit (advising mainly on economic policy). Finally, for the first time, the archive of the PM's Diary Secretary and the No.10 secretariat ("the Garden Room") escaped the shredder, giving us MT's appointment diaries and files for visits and engagements, packed with interest.

All told, these sources give us a far fuller picture of life at No.10 than has been available for previous PMs.

The Cambridge files are being released in tandem with those at Kew, staggered by a month or two. The third tranche covers 1981. Proposed changes to UK legislation mean that the bulk of her files will be released in the next five years, although it is possible that many sensitive documents will be extracted for longer closure.

A selection is being uploaded to coincide with release to the press: progressively more will appear on the site as the year goes on.

There is so much to comment on that it is best handled over multiple pages - you can jump from one to the next at the scroll end.

Besides MT's filing at Churchill, there is a whole range of collections for her main advisers and other important figures from which we are selecting documents to put online - Sir John Hoskyns, head of her Policy Unit 1979-82; Sir Bernard Ingham, head of her Press Office 1979-90; Sir Alan Walters, principal economic adviser 1981-83 & 1989 (whose diary we will shortly be publishing for the first time, in full and online), plus from the Treasury, Sir Adam Ridley, senior special adviser 1979-85 and Peter Cropper, special adviser 1979-82 & 1984-88.

Politics & the Economy in 1981: background

Politics in 1981 was again dominated by the poor state of the economy. Although the six quarter recession of 1979-81 technically ended in the second quarter of 1981, recovery was so intangible that it was problematic even to use the word. As late as Nov 1981 MT was taking a very cautious line on this topic in correspondence with friends. And even then she was to be disappointed, with a vengeance, in her privately expressed hope "that the pace of the recovery will be such that we may look forward to an impact on the unemployment totals earlier than past experience might have suggested". Unemployment passed 3 million in January 1982 and continued rising for the next four years.

The low point for the period is often assumed to be the 'Not for turning' speech (Oct 1980) and the budget that followed (Mar 1981), a sequence of events sometimes presented as a parable of virtue rewarded. But electorally (and therefore politically) the reward was long deferred: in polling terms the low point for the Conservatives was Dec 1981, when the SDP-Liberal Alliance peaked at over 50 per cent. The party's private polling was producing some terrible figures. As early as summer 1981 the Conservatives were registering support as low as 25 per cent, and a poll taken after the September 1981 reshuffle, which was supposed to begin a fight-back, put them at a desperately poor 16 per cent if an SDP-Liberal Alliance candidate stood (equivalent to the "don't knows"). MT's net approval rating stood at minus 41, much worse than Foot (minus 24) but slightly ahead of the government as a whole (minus 47). David Steel was plus 48, with no SDP leader yet in place.

Politics & the Economy in 1981: problems in party machine & the inner circle

In circumstances likely these, party morale and cohesion became constant problems, even at the heart of the government machine, well beyond the usual suspects. Party funding was a particular concern. A letter from Oct 1980 in a file released this year shows a key party donor expressing the deepest discontent, while the chairman of the 1922 Committee, Edward Du Cann, told MT to her face that he was "(u)neasy from May 1979 about dependence on monetarism". "Not getting money in. Not surprised about lack of money from industry because I don't understand the policy myself". MT did what she could to persuade and console - eg, in a letter to Emmanuel Kaye, then a strong supporter, much later a backer of Tony Blair.

The  story behind a key Party Political Broadcast by MT in July nicely illustrates some of the strains within her inner circle. It had been planned for many months, the product in part of an initiative by the Centre for Policy Studies to sell policy better via a series of Prime Ministerial "Fireside Chats" to the nation. It had to be produced by the BBC in a cheap studio reserved for the use of political parties rather than by Gordon Reece because, as MT pointed out: "We can't afford anyone else!" Unhappy at his lack of access to MT since the Conservatives had come to power, Reece himself had left Central Office the previous year for a job with Occidental Petroleum. He was summoned back to advise on this PPB in blunt style by MT's diary secretary, suggesting perhaps one of the reasons why his access had been curtailed ("I do not wish to read about this in the newspapers - if I do, I will know it is you that has leaked it" [sic]). The broadcast was originally intended to focus on unemployment, filmed on Reece's advice in a carpeted drawing room-style set designed to give a "general cosy impression", MT resisting wishful advice from Central Office to say that the recession had "bottomed out". But the whole thing was then overtaken by the summer's riots. Scheduled for broadcast on 8 July, only days after the violence in Toxteth, drastic last minute rewriting of the PPB triggered brutal in-fighting at No.10, with the Head of the Policy Unit, John Hoskyns, damning a script by John Selwyn Gummer as "the worst example of platitude-laden undeliverable clichés and nonsense that I have ever seen …. It is terrible", urging her to focus entirely on the riots and also to film in Liverpool. In his published diary, Hoskyns records swearing in front of the PM about the PPB script, loudly telling Ian Gow: 'Why can't you just stop these f***ing stupid arguments?' He apologised later to MT, who simply replied: 'I'm quite accustomed to it'. But he did not get his way on the script, and the set remained the cosy one designed originally for the very different broadcast on unemployment, flowers and all. (See Hoskyns, Just in Time, pp315-16.)

Hoskyns spent much of the year contemplating or threatening resignation. "You don't really believe in strategic planning work", he told MT in a long handwritten note on 4 Dec, "and I think we are all deluding ourselves if we now try to make a fresh start as if you do". He suggested effectively that she equip him to do the job instead, as Permanent Secretary of a new Prime Ministerial department, controlling not merely the No.10 machine, but the Central Policy Review Staff (the "Think Tank") and the Conservative Research Department to boot. MT countered with the offer that he become head of the CPRS, in which Hoskyns showed interest - only to find the offer withdrawn, apparently at the insistence of the Cabinet Secretary. He finally left No.10 during the Falklands War, on good personal terms with MT, but far from convinced that her government was going to be a success.