Margaret Thatcher: no quarter given when dealing with the ‘wets’

THE papers made public today lay bare Margaret Thatcher’s bitter battles with the Tory “wets”.

Files show how opponents of her hardline monetarist policies rounded on her in a cabinet showdown.

However, Mrs Thatcher took her revenge by sacking or sidelining her critics in a dramatic reshuffle.

The year 1981 was one of the most difficult of her time in office. As unemployment broke the 2.5 million mark, chancellor Sir Geoffrey Howe used his Budget to raise an additional £4 billion in taxation. The policy was condemned by 364 leading economists as having “no basis in economic theory”.

Their intervention provided fresh ammunition for the cabinet “wets” – traditional, one-nation Conservatives who were horrified at the direction Mrs Thatcher was leading the party.

She had already sacked one critic, Norman St John Stevas, and sidelined another, Francis Pym. But leading figures still remained, including Jim Prior, the influential employment secretary, and Sir Ian Gilmour, the lord privy seal and senior foreign office minister in the House of Commons, whom Mrs Thatcher believed were privately briefing journalists against her. Bernard Ingham, her pugnacious press secretary, warned she had “a manifestly divided and warring Cabinet”.

“The government is divided and seen to be divided,” he wrote in an internal memorandum. “As I have told the Prime Minister, there is nothing I can do in these circumstances to carry conviction. Not to put too fine a point on it, we need to restore honour and discipline at Cabinet level.”

The struggle came to a head on 23 July. Cabinet began with Sir Geoffrey presenting a paper on public expenditure, arguing they had to keep cutting borrowing. The minutes do not identify who spoke, but – in unusually frank language – they show it was denounced as “inadequate” and his strategy “unrealistic”.

Mrs Thatcher chose to play for time, agreeing that Sir Geoffrey should come back after the summer with “a fuller evaluation of the options”.

On their return in September, Sir Ian, education secretary Mark Carlisle and the leader of the Lords, Lord Soames, were sacked while Mr Prior was moved to Northern Ireland, curbing his opportunity to influence economic strategy.