The 31 pit closures announced in October 1992 were a point of no return for the British coalfields, the eventual death knell for deep mining and the loss of tens of thousands of jobs.
A botched announcement, a Tory party revolt, and an embarrassing U-turn for John Major only months after being re-elected Prime Minister, did bring about a temporary reprieve, but the closures went ahead, ready for a slimmed down British Coal to be privatised.
There was a public outcry that had shocked the Prime Minister: 200,000 people marched through London in protest, and the miners’ leader Arthur Scargill was hailed a hero.
Cabinet papers revealed confidential Downing Street memos that contained excoriating criticism of the then President of the Board of Trade, Michael Heseltine, for mishandling public sympathy for the miners, and for allowing accusations of a government “betrayal” of men in the Nottinghamshire coalfield, who had stayed loyal to Margaret Thatcher in the 1984-85 pit strike.
After the shock announcement of the closures, and news that a pay-off for the 30,000 redundant miners would cost £1 billion, Major was forced to order an immediate inquiry into energy policy.
Heseltine was criticised for having relied on “unsatisfactory” advice from the government’s City of London financial advisers Rothschilds, and for failing to keep abreast of the law on colliery closures.
One Downing Street adviser said that in slimming down the coal industry – ready for selling off – Heseltine had been hoping to take the credit for the next “major popular privatisation”, but instead was shocked to discover that “he was to act as the undertaker to the coal industry.”
The lesson of Major’s hurried retreat – said another memo – was that in future the Prime Minister should be careful “not to fall into the trap of assuming that ministers and officials know what they are doing, or have thought it through.”
Heseltine bumps up redundancy pay-off to £1 billion
For some months, Rothschilds had been advising on how best to privatise British Coal – the successor to the National Coal Board – which then had 50 pits and employed 54,000 miners.
Because deep-mined coal could not compete with the price of imported coal, and because new coal contracts had to be signed with the electricity generators within months, Rothschilds recommended 31 pit closures, ready for a slimmed down British Coal to be sold off as two separate companies.
Initially, in July 1992, the internal argument revolved around the scale of the redundancy payments that would be needed.
Michael Portillo, chief secretary to the Treasury, and the Chancellor, Norman Lamont, wanted to cap the redundancy pay-off at £350 million.
Heseltine demanded far more generous terms, arguing that the government should buy out the risk of another pit strike. British Coal wanted each miner to be paid from £35.000 to £42,000, at a cost to the Exchequer of nearly £1.3 billion.
On current coal prices, “virtually none of British Coal’s mines would be immediately viable”, and Heseltine said the pay-offs were needed because British Coal would have to impose compulsory redundancies and abandon safeguards in the colliery review procedure.
Lamont agreed to go to £720 million, although he thought that was still “too lavish”, but Heseltine insisted that unless redundant men got the equivalent of two years’ pay, there could be a backlash;
“This could all too easily create a sense of betrayal, particularly among UDM miners in Nottinghamshire, who this time will be harder hit than NUM miners in Yorkshire.”
Heseltine backed up his case with warnings from pit managers about the impact of abolishing the colliery review procedure and the loss of the chance for men to opt to work at other pits.
“British Coal say unattractive terms will lead to a collapse in morale, strikes, possible industrial vandalism, and perhaps civil disorder.”
As late as mid-September there had still been no agreement. The Treasury said the country could not afford Heseltine’s latest estimate of £1.1 billion and warned that the government should not be “blackmailed by threats of strike action.”
Prime Minister meets leader of Nottinghamshire miners
Arthur Scargill, President of the National Union of Mineworkers (NUM), had already published leaked documents suggesting that more pit closures were likely, and as the Nottinghamshire coalfield faced substantial closures, Major called a meeting with Roy Lynk, President of the rival Union of Democratic Mineworkers, which had continued working during the 1984-85 strike.
A Downing Street note preparing Major for the meeting warned that the closures would be “particularly unpalatable” in Nottinghamshire, and that the miners might feel they were being treated unfairly. The UDM was principally concerned about the lack of alternative employment rather than the redundancy terms.
“The effect on UDM areas would be devastating. British Coal Enterprises would be unable to provide new employment opportunities to match the scale of the redundancies. Areas such as Mansfield, where the 1984 strike had been resisted, would have a 20 per cent unemployment level.
“Many parts of the East Midlands would become industrial wasteland: about 12,000 miners, currently earning £20,000 on average, would be made redundant.”
At his meeting with the Prime Minister, the UDM President complained about being described as “a puppet of the government” by Scargill, and the UDM was losing ground in the Nottinghamshire coal field. A Downing Street note said that Lynk feared ten pits might close and asked for more support for generating new employment opportunities:
“It would be important to co-ordinate better all the agencies dealing with regeneration...The Prime Minister expressed his concern about the many small communities dependent on mines that would close. What would be the impact? ‘Horrific’ said Mr Lynk.”
Outcry over pit closure announcement
On the eve of his statement in the House of Commons (13.10.1992) Michael Heseltine was reminded by Michael Portillo that he should stick to the figure agreed by the Treasury: the redundancy pay-off for 30,000 miners would cost “up to a billion”.
In the event the size of the pay-off was not the issue. Next day’s newspapers were dominated by reports of “nightmare” news for the coalfields. “Savage government axe kills 30,000 mining jobs,” was The Guardian’s front page headline.
Although The Guardian acknowledged that the £1 billion package to fund compulsory redundancies was the most “generous on offer,” Heseltine was criticised for failing to say how much had been set aside in employment support for the mining communities.
Such was the outrage in the Conservative Party at the betrayal of the UDM that Major was forced within days to call an emergency cabinet meeting that agreed to re-phase the closures. Ten of the 31 pits were taken off the list, and the other 21 closures delayed for a full review into their viability.
“Hezza’s U-turn on pits” was the Sun’s headline. “Major’s pit stop” was blazoned across the Daily Mirror’s frontpage report on the Prime Minister’s “sensational and humiliating climbdown.”
But what was dubbed “The Great Tory Revolt” showed no sign of abating and “hundreds of the Sun’s readers” sent messages of support to the Nottinghamshire miners’ leader Roy Lynk. “Two million lights went out across Britain last night as people flicked a switch to support the miners.”
Miners from Frickley dumped a lorry load of coal to block the gates to Heseltine’s country estate alongside a banner declaring, “Coal Not Dole. Frickley NUM. Up Yours!”
Major faced defeat in an emergency debate and Heseltine was forced into his second climbdown within three days with an announcement of a wide-ranging review into government energy policy to investigate whether the energy market had been “rigged” against the coal industry.
“Tories struggle home with 13-vote majority on pits,” said the headline on the front page of The Times over its report of a stormy debate in which six Conservative MPs voted with the Opposition and another five abstained.
Miners win unprecedented praise from right-wing press
Filling all the front pages were pictures of a march through London organised by the NUM, to coincide with the critical House of Commons vote, which attracted 100,000 protestors and drew support from across the capital. Twice as many attended the TUC’s mass rally in Hyde Park the following Sunday.
Even though I have spent much of my career trying to keep abreast of the highs and lows of the coal industry, I found it a humbling experience digging into my files and turning over the newspaper front pages for 22 and 26 October 1992.
If only the miners and their union had been able to win over the right-wing press in the way they did that week, Mrs Thatcher might well have been forced to negotiate her way out of the 1984-85 strike.
Almost filling the Sun’s front page was a photograph of “a mighty army of miners” whose march for coal and jobs “won the support of Britain’s diehard Tories”. To the paper’s evident surprise even “Sloane Rangers left their tables at swanky eateries and customers poured from posh boutiques in Kensington and Chelsea to wave them on”.
“Pit leader Scargill is mobbed by admirers as smiling police look on,” said the caption to the Daily Mirror’s front-page picture. “In swanky Park Lane, an admirer handed Scargill a bouquet of white chrysanthemums.”
Instead of the invective of the 1980s, the Sun’s editorial reflected the mood on the streets: “The miners’ conduct yesterday was exemplary. They are men of honour”. For the Daily Mail it had been a day of “quiet dignity” when the miners and their families brought their “peaceful protest to London” in “marked contrast to the ugly, violent scenes which characterised the 1984 strike”.
Heseltine lambasted by Major’s Downing Street aides
The cabinet papers revealed the depth of anger within Downing Street over Heseltine’s botched announcement. “We have lost the emotional and economic argument,” said one note to the Prime Minister the day before the vote.
As Major picked himself up after the rebellion, and Heseltine set in motion arrangements for the inquiry into the energy market, an inquest was launched in Downing Street to work out how to recover the initiative. David Poole, an adviser in the policy unit, had some blunt advice for Major:
“The principal lesson to be learned from this episode when dealing with issues of policy is that one should not fall into the trap of assuming that ministers and officials know what they are doing or have thought it through.”
Major was told by Poole he should be “buttonholing” Heseltine to get a clear steer as to whether the review was simply designed to “smooth the way towards the eventual implementation” of the interrupted pit closure policy.
Keith Loader, private secretary to Heseltine, wrote back to reassure the Prime Minister that the department was proposing a “genuine” review into the 21 named pits and this would consider “social and economic implications of further pit closures” as well as the options to “increase coal burn”.
Poole wasn’t convinced and feared Heseltine wanted to re-phase the redundancies over two or three years to reduce the number of miners put out of work simultaneously and keep the proportion of coal burned higher than would be the case were there a competitive market. “Any option to increase coal burn will involve direct interference in the electricity market.”
Heseltine was also criticised for leaving it until the day of his announcement before informing fellow ministers of the names of the 31 pits identified for closure.
A copy of Heseltine’s Parliamentary statement was sent to Downing Street the day before, but pits were not named. British Coal’s “jealously guarded resistance” to passing on detailed information had contributed to the “widespread failure to foresee the strength of public reaction,” said Sir Peter Gregson, who had been asked by the Cabinet Office to discover why there had been this widespread lack of knowledge as to what would be announced.
David Poole in the policy unit assessed the reasons for the confusion in a confidential report titled “The Pit Closure Episode.”
He concluded that the closure announcement took on its own momentum because officials “over relied” on Rothschilds’ advice and failed to stop and ask themselves whether announcing 31 closures altogether remained a sensible option.
This failure was compounded by the fact that at this critical moment the Department of Energy had been merged with the Department for Trade and Industry. Poole believed this was where the fault lay:
“This was just when the coal industry needed a senior and politically sensitive cabinet minister who wholly understood the detail not just of pit closures but also the electricity industry, its key players and their inter-action to the electricity and coal market places.
“Unfortunately, Michael Heseltine did not meet these criteria. Furthermore, I have come to believe that he was simply unable to bring himself to face up to the truth of what it was that he was being required to do.
“Rather than being about to take the credit for the next major popular privatisation he discovered that he was to act as the undertaker to the coal industry. At no point until the crisis broke did he properly engage himself in what was taking place.
“Increasingly ministers and officials became mesmerised by the detail of the process and failed to stand back in order to keep the wider context and implications in view.
“When therefore the announcement of the pit closures programme became a lightening conductor for national fears, no one was adequately prepared.
“The department allowed themselves to be rolled over by British Coal who ran an effective and highly destructive public relations campaign designed to shift blame from themselves and on to the government.”
Poole believed Heseltine should have been alerted to the political dangers that lay ahead when Arthur Scargill published leaked documents suggesting that pit closures were being planned.
“We allowed ourselves to be lulled by our muted response to Scargill’s leak...There was a complete failure of political sensitivity at exactly the time it was needed.”
Poole also urged an inquiry into the role of the financial advisers Rothschilds with whom blame should lie for not exercising due diligence and for the “quality and breadth of their advice.”
“Something must be done to signal a reaction to unsatisfactory work, particularly by financial advisers in the City who charge government very substantial fees.”
Review and reprieve fail to halt coal’s death throes
Finally, objectives were agreed for the energy review. They included ensuring that British Coal could compete with imports so as to “ensure coal can be returned to the private sector as soon as possible” while attempting to “save enough pits to satisfy the political expectations underlying the review.”
In a note on the review, Heseltine concluded that the “energy market was not rigged against coal”; that British Coal was not competitive and that 25 to 35 pit closures were inevitable; and that he favoured a four to five-year transition with subsidies to British Coal “to allow phased pit closures at the lower end”.
Heseltine had fulfilled undertakings to MPs: there had been an extensive review and reprieve for ten of the 31 pits, but the protests ultimately proved futile.
Nonetheless it begged the question: if it was possible to force the Major government on to the defensive through the combined pressure of two demonstrations, a backbench revolt and a critical media, why had the NUM been unable to mobilise that same level of support when it mattered most of all in 1984?
Any wishful thinking would have had to be tempered by the grim reality of the lead-up to the privatisation of British Coal. In December 1994, at the chairman’s final lunch for industrial correspondents, I sat next to Kevan Hunt, director of employee relations. My note of what he said encapsulated the death throes of a once great industry:
“We saw Michael Heseltine in the summer of 1992, just before he announced the closure of 31 pits that October. He refused point blank to stop the dash-for-gas although forty coal-fired power stations had already been closed. The Conservatives dropped the ban on burning gas for generating electricity in 1990. Gas stations are much cheaper to build and are much more profitable…We knew a future Labour government could not do anything because the privatised regional electricity companies cannot be forced to burn coal…I don’t think there is any chance of a comeback. Even if coal for oil becomes a proposition, it will be done in Australia where coal reserves are so cheap… We knew the moment we met Heseltine that the coal industry was finished. He said the dash-for-gas had been a great commercial success. We could see Heseltine liked the political freedom it had given the Conservatives. I think he could have saved the industry if only he had been willing to stop the dash for gas”.