The other members of Cabinet — Gordon Campbell at Scotland, George Jellicoe as Lord Privy Seal and Leader of the Lords, Peter Thomas, a close parliamentary neighbour and friend, as Secretary of State for Wales and Party Chairman, and Michael Noble briefly at Trade — did not figure large in discussions. I therefore found myself with just one political friend in Cabinet — Keith. Although I generally had polite and pleasant relations with my other colleagues, I knew that we were not soulmates. Doubtless they knew it too. Such things often show through more clearly in casual conversation and spontaneous reactions than in argument. What with the formidable difficulties I faced in Education, I therefore had little incentive to try to win wider strategic points in Cabinet.
Ted’s mastery of the Cabinet was complete and unchallenged. He had won the 1970 election against all expectations and by means of a very personal campaign. We were aware of this and so was he. Moreover, argument from first principles was alien to his nature and disagreeable to his temperament. Until 1972—73 and the events of the U-turn, the unity of Cabinet under Ted’s leadership was at least in part simply recognition that he was Prime Minister and had a right to expect support in carrying through the programme. Once the programme itself was abandoned and an exercise in corporate interventionism adopted in its stead, the atmosphere grew worse, not manifesting itself in dissent but in the occasional leaked grumble. We knew we were locked in.
A ROLLS-ROYCE POLICY
For all the difficulties which were quickly upon us that summer and autumn of 1970, such melancholy reflections were still far from our thoughts. Indeed, Ted Heath, Tony Barber, Robert Carr and John Davies set out on the course of radical reform with impressive zeal; and the rest of us in the Cabinet were enthusiastic cheerleaders.
First, the Government embarked with a will on cutting public spending. (In fact this review was to be the only sustained Cabinet-level exercise of the kind during the entire period of 1970–74; the cuts of December 1973 would be made at speed and without detailed discussion in Cabinet.) Discussions began at the end of July. A target was agreed of £1,700 million net reduction in planned spending by 1974/75, and Ted circulated a paper on the economy to show his commitment to the strategy. The cuts were to fall most heavily on industrial spending, though as already noted I had my own departmental spending battles at Education. Investment grants were ended. The Industrial Re-organization Corporation (IRC) would be closed down. Aircraft and space projects would be subject to the closest scrutiny. Even with the reprieve of the hugely expensive Concorde project, largely on European policy grounds, it was an impressive free-market economic programme. And it made possible a tax-cutting Budget in October, which reduced the standard rate of income tax by 6d, down from 8s.3d in the pound (just over 4ip), and made reductions in corporation tax to take effect at the beginning of the next financial year.
Nor was there any delay in bringing forward the other key feature of our economic programme — the Industrial Relations Bill. The framework of the Bill was already familiar: this was one of the areas of policy most thoroughly worked out in Opposition and we had published our proposals in 1968. It was to be an ambitiously comprehensive attempt to provide a new basis for industrial relations. The main principles were that collective bargaining agreements should be legally enforceable unless the parties to them agreed otherwise, and that the unions’ historic immunities from civil action should be both significantly narrowed and confined to those whose rule books met certain minimum standards (‘registered unions’).
Cases brought under this legislation would be dealt with by a new system of industrial courts and tribunals, headed by a branch of the High Court — the National Industrial Relations Court (NIRC). The Bill also gave new powers to the Secretary of State for Employment, as a last resort when negotiation had failed, to apply to the NIRC either for an order deferring industrial action for up to sixty days — a ‘cooling off’ period — or for one requiring a secret ballot of the workers involved before a strike.
There was a good deal in the Bill that actively favoured trade unionism, for all the hostility it encountered on the Left. For the first time in English law there would be a legally enforceable right to belong (or not to belong) to a trade union. There would be statutory protection against unfair dismissal — again, a new principle in English law. Finally, the Bill would repeal provisions under previous legislation that made it a criminal offence for gas, water and electricity workers to strike during the lifetime of their contracts.
At the time I was a strong supporter of the Bill, although I had doubts about particular parts, such as the measure on essential services. We were all conscious that the previous Labour Government had backed off from its In Place of Strife proposals for trade union reform under a mixture of union and Party pressure. We were, therefore, doubly determined to make the changes required.
In retrospect, the philosophy of the Bill was muddled. It assumed that if the unions were in general confirmed in their powers they would both discipline their own members industrially, reducing wildcat strikes for instance, and use their industrial strength in a regulated and orderly fashion on the American model. But it also contained provisions to strengthen the powers of individuals against the unions. So the Bill was in part corporatist and in part libertarian.
Specifically there were four flaws. First, the Bill was full of loopholes. By refusing to sign agreements unless the employer conceded that they need not be legally binding, the unions effectively bypassed one legal sanction. They also discovered an effective tactic to stymie the Bill’s ambition to transform the nature of British industrial relations — many simply de-registered and went on behaving as if they still possessed the old immunities, defying anyone damaged by their activities to bring an action, and defying the courts on the rare occasions when actions were brought.
Second, we were not clear how the Industrial Relations Act fitted into our overall economic strategy. Our movement towards a ‘voluntary’ incomes policy — starting with the so-called ‘n–i’ policy[25] which had begun even before the Bill was introduced — increased the occasions for disputes about pay and put the fledgling Act under huge pressures. Eventually, the Industrial Relations Act was shelved, at least tacitly, as part of the attempt to stitch up a deal with the trade unions on pay.
Third, if we were to rely so heavily on the law to improve the climate of industrial relations, we should have avoided creating so many new institutions and procedures all at once. This allowed our opponents to claim that the system was rigged against them. And when we used the new powers to impose ‘cooling off’ periods and strike ballots, these were promptly discredited as disputes heated up and the votes went against us.
25
‘n-1’ was a semi-official policy that each year’s pay increase should be 1 per cent less than the previous year’s.