Date formed 11 June 1987 | Date dissolved 27 November 1990 | |
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Deputy head of government Lord Whitelaw (1987–88)Sir Geoffrey Howe (1989–90) | ||
Margaret Thatcher was Prime Minister of the United Kingdom from 4 May 1979 to 28 November 1990, during which time she led a Conservative government. She was the first woman to hold that office. During her premiership, Thatcher moved to liberalise the British economy through deregulation, privatisation, and the promotion of entrepreneurialism. This article details the Third Thatcher ministry, which existed from 1987 until 1990.
Contents
Election
The Conservatives were elected for a third successive term in June 1987, with a majority of 102 seats. It enabled Margaret Thatcher to become the longest-serving Prime Minister of the 20th century, as Britain's economic recovery continued.
Policies and economy
With the battle against inflation and strikes long won, an economic boom was in its early stages. Unemployment had fallen below 3,000,000 during the spring of 1987, and the tax cuts by chancellor Nigel Lawson sent the economy into overdrive. By early 1988, unemployment was below 2,500,000. A year later, it fell below 2,000,000. By the end of 1989, it was down to 1,600,000. A residential property price surge saw the average home price in Britain double between 1986 and 1989.
However, this led to the government doubling interest rates during 1988 and it chose to increase these further during 1989 and 1990 as inflation increased.
As early as September 1988, economists were warning that the economic boom would soon be over and that 1989 could see a recession set in. However, the economy continued to defy these predictions and it continued to grow throughout 1989 and unemployment continued to fall, despite several other world leaders – namely the United States of America – entering recession that year.
By the end of the 1980s employment was booming above all in the financial and retail sectors – particularly on new commercial developments that were built on old industrial sites. For instance the Merry Hill Shopping Centre in the West Midlands saw 6,000 retail jobs created between 1984 and 1989 on an old steelworks site which had shed just over 1,200 jobs when it closed in 1982. The comparable MetroCentre was built at Gateshead, Tyne and Wear, around the same time.
On 29 March 1988, The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry, Mr. Kenneth Clarke, announced the sale to British Aerospace of the Rover Group, a novel name for British Leyland, which in turn had been nationalised in 1975 by the government of Harold Wilson.
The government's popularity declined in 1989 with the commencement of the unpopular "poll tax" (Community Charge), which was introduced in Scotland that year and to the rest of Great Britain a year later. By the end of that year, in spite of the economy remaining strong, many opinion polls were showing a double-digit Labour lead and this was largely blamed on the poll tax. Sir Anthony Meyer, a 69-year-old back-bencher, challenged Mrs Thatcher's leadership in December; his challenge was seen off in a whole house vote by Thatcher in which a considerable dent on her majority of 100 was felt (60 of her own MPs failed to vote to keep her premiership).
The poll tax saga continued throughout 1990, culminating in riots across London in early spring. Labour continued to benefit from the situation as their lead in the opinion polls widened, and they made gains from the Tories in local council elections and more than once in by-elections. The new Liberal Democrats, after a weak start, were starting to gain ground in the opinion polls, and seized the safe Eastbourne seat in its by-election in October.
The threat of recession finally became reality in October 1990, when it was confirmed that the economy had declined during the third quarter of the year. Unemployment started to creep up again. Inflation, which the first Thatcher government had famously conquered by 1983, was touching 10% for the first time in eight years.
Fate
Then, on 1 November 1990, came the first of a series of events which would spell the end of Margaret Thatcher's years of power. Sir Geoffrey Howe, the deputy prime minister, resigned from the cabinet over its European policy and was resentful of being ousted as Foreign Secretary. He quickly publicly denounced Thatcher, having once been one of her closest allies, personally and for her hostility towards the programmes of the European Community. On 14 November, former cabinet minister Michael Heseltine challenged Thatcher's leadership. Thatcher polled higher than him in the leadership challenge, but failed to gain an outright victory in the first round of voting.
On 22 November, Margaret Thatcher announced her resignation of prime minister and Tory leader after more than 11 years, explaining that she was resigning to make way for a leader more likely to win the next general election.
Her successor was the chancellor John Major, who was elected on 27 November 1990, and at 47 became the youngest British prime minister since Lord Rosebery in 1894.
June 1987 to July 1989
Changes
July 1989 to November 1990
Changes
List of Ministers
Members of the Cabinet are in bold face.