The Thatcher Crisis Years

An era of protest and fury

Labour Party left

The first two years after Labour lost to Margaret Thatcher in 1979 saw all out war in the party. And it was a finely balanced battle between Left and Right. The whole thing hinged on the 1981 Deputy Leadership election between left-winger Tony Benn and right-winger Dennis Healey.

The result was the slimmest of victories for Dennis Healey. But it signalled an end to a phase when the so-called “Bennites” thought they could take control of the party. Think of them as the Momentum of the early 1980s.

Tony Benn had begun life as a fairly centrist minister in a 1960s Labour government under Prime Minister Harold Wilson. But he’d moved leftwards over the years – the opposite direction to most Labour MPs who started on the Left and moved to the centre.

Benn became the standard bearer for those in the party who thought that the 1974-79 Labour government had fallen because it was insufficiently socialist – and had capitulated to business interests and the International Monetary Fund.

Healey had started life as a Communist Party member at university but by the end of the 1940s was a staunch anti-Communist and a leading member of the moderate Fabian Society.

In the 1974-79 Labour government, Healey couldn’t have been less popular within the party as Chancellor of the Exchequer pushing through curbs on pay and cuts in spending.

Benn and Healey were two formidable characters. Benn pushed through reforms to the Labour Party constitution that created an electoral college for choosing the party leader and deputy leader. This broadened the franchise from just the parliamentary party to the trades unions and the constituency parties.

And then in 1981, Benn announced he would run against Healey to be Deputy Leader of the party. Healey already held the post and was the choice of MPs. Benn gambled that the wider labour movement, which now had a vote, wouldn’t be so positive towards him.

At the same time, a group of right-wing Labour MPs and their supporters quit the Labour Party to form the Social Democratic Party (SDP). So, Benn must have felt that the leakage of these right-wingers benefited his chances.

The constituency parties swung behind Benn big time. But the trades unions weren’t so easily seduced. You have to remember that trade union membership was much higher in 1981 and encompassed large swathes of the private sector and the nationalised industries.

The trade union bosses – often referred to as ‘barons’ – tended to support the centre ground. All they wanted was a return to the world before Thatcher, who’d only been in power since 1979. That world was one where they went to Downing Street and sat round a table with industry bosses and politicians and planned the economy, to put it crudely.

‘Beer and sandwiches’ at Downing Street was their dream. And there was a widespread opinion that Thatcher was screwing up the economy to such an extent that a Labour victory in 1983 was possible. Therefore, don’t rock the boat.

But in addition, Benn was a Marmite personality. Plenty of trade union barons just didn’t like him. Either he was too posh, too divisive or too much a part of the trendy London left. Rather like Jeremy Corbyn, his persona and the way he was portrayed in the media took its toll in the party.

DISCOVER: The economic Recession of 1979 to 1981

When the Deputy Leadership election was held in 1981, Benn lost by a tiny margin. In the second round of balloting, Benn got a third of MPs, which was respectable. He took over 80% of constituencies. But when the trades unions cast their block votes, Benn got 37.5% of union support with the rest going to Healey. The electoral college maths meant that he lost by 49.6% to Healey’s 50.4%.

In any normal election contest – certainly if there had been one person, one vote – Benn would have romped home. But with a system that he himself had helped to create, he was denied victory.

This film captures the intensity and vitriol that was unleashed at that time.

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