Sunday, 5 February 2012

Great Political Mistakes - Thatcher and the poll tax

This is a documentary that was first broadcast on BBC4 in 2005.

The programme begins with Sir Anthony Meyer's quixotic challenge for the Conservative Party leadership in November 1989.  Thatcher won, of course, but a sixth of her colleagues refused to vote for her, and others said that they would never vote for her again.  The deputy chief whip, Tristran Garel-Jones, warned her that her enemies would return the following year and strike her down.  How had Britain's longest-serving prime minister of modern times come to this pass?  A large part of the answer lay in the poll tax.

Thatcher's desire to reform the system of local government rates went back to her time as a minister in Ted Heath's government in the 70s.  The reasoning behind the case for reform was that it was unfair for non-ratepayers to vote in high-spending Labour councils whose revenue would then be raised from a limited body of property-owners.  For some, this was part of the logic of electoral democracy.  For others, it was an intolerable inequity.

In 1984, Thatch assembled a committee to come up with a replacement for the rates.  Ironically, this was headed by one of the party's leading moderates, William Waldergrave.  The committee looked at various alternatives before coming up with a proposal for what was termed the "community charge".  Everyone would be required to pay the same sum to local government without reference to their assets or income.

The proposal was presented to her in 1985 by Waldergrave, Patrick Jenkin and the Environment Secretary, Kenneth Baker.  Crucially, the Chancellor, Nigel Lawson was kept out of the loop.  Lawson apparently read about the proposal for the new tax in the papers.  He thought that it was a "colossal error of judgement" and tried to block it.

The tax wended it way through the machinery of government with little proper scrutiny.  It was presented to the Cabinet at the same meeting at which Michael Heseltine resigned.  It mostly escaped the attention of the press.  Meanwhile, Thatcher described the community charge as her "flagship" and took the fateful decision to associate herself with it personally.

A proposal to phase the tax in over a number of years - known as "dual running" - was abandoned.  This hardline approach was contrary to the wishes of Ken Baker, who had by now been replaced as Environment Secretary by Nicholas Ridley.  Meanwhile, Nigel Lawson, whose relationship with Thatcher was fraying, refused to provide extra funding to ease the introduction of the tax.

The tax was introduced in Scotland in 1989, to the fury of the locals.  It was clear that the same reaction would be reproduced when the tax arrived in England and Wales the following year.  This was the context of Meyer's failed leadership bid.  Yet Thatcher was not interested in departing from her policy.  A riot in protest at the tax broke out in London in March 1990, but this only confirmed her in her stance.  She wrote off the opposition to the tax as far-left agitation.  She seemed not to perceive that the real problem lay with her own core supporters, who hated the tax.  They did not riot - but they did vote.

As everyone who lived through that period must remember, the tax was wildly unpopular.  Up to 70% of the public were against it.  By summer 1990, non-payment was running at up to 50% in some areas.  Closer to home, Michael Heseltine publicly attacked the tax in The Times.  It was an ominous sign.  Backbenchers realised that their seats were on the line - and to get rid of the poll tax they had to get rid of Thatcher.

By the end of November 1990, it was all over.  Charles Powell assesses that the poll tax was 40% responsible for Thatcher's downfall - together with 20% attributable to her stance on Europe and 40% to her general autocratic style.