Downing Street Years - Margaret Thatcher [68]
Although it was now obvious that the unions had lost — with the strike clearly failing to cripple industry and the strikers themselves increasingly demoralized — the precise terms on which the Government and management had won remained in the balance. On 9 March BSC had held a ‘ballot about a ballot’, asking workers whether they wanted a ballot on pay, which the ISTC had hitherto denied them, and this had shown strong evidence of disenchantment with the ISTC’s tactics and leadership. The union wanted a way out which would save face. BSC had formally proposed arbitration on 17 February and, although rejected, the offer had remained open. There was strong pressure — which I wanted to resist — for a Court of Enquiry into the strike which would propose a settlement. I would have preferred the involvement of ACAS (the Advisory, Conciliation and Arbitration Service). It seemed to me that if ACAS had any reason for existing at all, it should surely have a role in a situation such as this. In fact, we were condemned to watch while BSC and the unions agreed to the appointment of a three-man enquiry consisting of Lords Lever and Marsh (both former Labour Cabinet ministers) and Bill Keyes of SOG AT, which on 31 March recommended a settlement well above the figure originally offered by BSC but substantially below what the ISTC had demanded. The offer was accepted.
At its final meeting on 9 April my committee was told that all the BSC plants were back in operation. Production and steel deliveries were both about 95 per cent of what they would have been without the dispute. The outcome, in spite of the size of the final settlement, was generally seen as a victory for the Government, if not for the BSC management.
The bills, however, kept on coming in. On 6 June Sir Charles Villiers wrote to Keith Joseph saying that he foresaw the need for an additional £400 million in the financial year 1980–81, over and above the £450 million already allocated. The proposals made by BSC to stay within the borrowing limit set by the Government (its EFL or External Financing Limit) involved various financial devices including the sale and lease-back of assets. The only alternative they had to suggest was that in effect BSC should go into liquidation. Clearly, whatever the pressures imposed by the strike, matters should never have been allowed to come to such a pass and it reflected badly on the management. But we had already decided what to do about that. In spite of some outcry over the terms offered, Ian MacGregor had been appointed to succeed Sir Charles Villiers. I expected him to deal with the appalling commercial and financial legacy and in due course we approved very large increases in the funding of BSC to allow him to do this. Nor were we disappointed. Another cost, which we did not begrudge, was the money made available to encourage new development in areas badly affected by redundancies, such as Llanwern, Port Talbot, Consett and Scunthorpe.
This had been a battle fought and won not simply for the Government and for our policies, but for the economic well-being of the country as a whole. It was necessary to stand up to unions which thought that because they were in the public sector they should be allowed to ignore commercial reality and the need for higher productivity. In future, pay had to depend on the state of the employing industry, and not on some notion of ‘comparability’ with what other people received. But it was always going to be more difficult to induce such realism where the state was owner, banker, and at times tempted to be manager as well.
BRITISH LEYLAND: 1979–1980