The Thatcher interview that sparked talk of a European referendum – and sealed her fate

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24-02-2025

This article is published as part of The Telegraph's Greatest Interviews series, which revisits the most significant, informative and entertaining conversations with notable figures over our 170 year history. The below interview is introduced by original interviewer Charles Moore. It appears as it was originally published.
This interview took place on a Friday, a dark and dismal November evening in Downing Street. The following Thursday, Mrs Thatcher announced her resignation. When we met, I could not know this would happen, but I noticed that she was anxious and all over the place. She talked too much, delivering an irrelevant and therefore unpublishable account of European history from the Roman Empire onwards. She needed a whisky afterwards, as did I.
Her published words, though, introduced a clear new element in her thinking – a referendum. Her colleagues hated this idea, and her decision to go public with it probably contributed to her fall; but from then onwards the idea of a vote on Europe was 'out there'. Her boat would come in more than 25 years later, with the result of the Brexit referendum in 2016. – Charles Moore
Owing to the punctilious rules of the British Civil Service, I was not guided to the drawing-room of No 10 Downing Street by the Prime Minister's press secretary, Bernard Ingham. The leadership campaign is a party matter, and so I was accompanied by one of Mrs Thatcher's political staff. As I entered. Mrs Thatcher was complaining about the heat and struggling to open the recently painted sash window. She gave me whisky, resisted it for herself, after a moment's wrestling with temptation, and then spoke for more than an hour. In the House of Commons the day before, she had looked drawn and tired. On Thursday evening, she looked much better – alert and relaxed.
I asked Mrs Thatcher first whether she thought the coming contest was the most important of her life. 'Every contest that I fight is always the most important because it is the most immediate. Life is really just a series of hurdles and you have to take them.'
Did she see this as the last battle? 'No, I don't.'
Did she regret the contest, particularly when there was a possibility of war in the Gulf?
'I cannot complain about there being a contest. … It does obviously have some effect which I could well do without at the moment, but if someone else decides to have one, the rules permit it, so we just get on with it.'
On the credentials of Mr Heseltine, the Prime Minister was succinct: 'I never discuss my opponent, never.' So I asked her instead whether she blamed herself at all that the contest was taking place. There had been several senior resignations: '... Do you think your treatment of senior ministers has brought this contest upon you?'
'No, Mr Heseltine walked out of Cabinet because he would not accept collective responsibility, and with an important decision coming up, he decided not to. And then he decided to walk out. It was not personalities at all. in any way.' About Sir Geoffrev Howe, Mrs Thatcher's tone was more sad and puzzled. She seemed personally hurt by his speech. He had said that she was difficult to work with: 'After eleven and a half years it is a little bit late to make this accusation, it really is. I could complain too. I could complain a lot. Whatever would be the point? ... No-one has ever found it difficult to put a point to me. They know I thrive on argument. They know full well, I have no toes to tread on, I have no resentments to anyone; if I suddenly come up with something and am a bit sharp now and then they know it's over. Over.'
The criticisms had been made, however. The Conservative Party was clearly not united. How could she reunite it?
'Well, exactly in the same way as we have done before. There have always been certain differences of emphasis about Europe. We shall unite because the things that we believe in together are far greater, and far more fundamental, than the things we disagree on. You see, in the end, if you look at Geoffrey's speech, it did not come down to fundamental policy disagreement – I've been through it again and again. He said we do not want a single currency imposed upon us. I agree.'
'But, Prime Minister, he also spoke very strongly about what he described as your 'nightmare vision' of Europe. He said it would be a tragedy for our country if it lived in a 'ghetto of sentimentality about the past'.'
'It's a very, very emotional phrase. It bears no relation to reality, and I would hardly call our history of parliamentary democracy and the common law, the heritage of freedom under the rule of law and what it has done for Europe living in a ghetto of sentimentality. I would say that people who do not learn from the past are perhaps very foolish and will make fundamental mistakes in the future. Our tradition has been of moderate parliaments, based on the financial control of the executive. It has served Europe well. Our tradition has been that things grow and evolve.…Things are stronger when they happen that way.
'So we are naturally suspicious of people who come along and desire to do something quite different from what you've got now and offer a blueprint which says, 'You've got to go to that.' It won't work and, what is more, I would say it is wrong to sign up to anything before you know what its effect will be upon your own people.... That's our tradition, it's right, and it's stood people in very, very good stead, and to dismiss that as a ghetto of sentimentality about the past, well, lots of people have died for that past, died that we might have our present.'
'And do you think that it is almost a matter of life and death for the British nation?'
'No. I have known many things in my life which were alleged to be inevitable. People said that about communism: it was inevitable. And some of us fought it. And that inevitability crumbled. And that inevitability of socialism in this country is crumbling. You never, if you are in politics and you are a leader, accept that things are inevitable. You are here to influence them in the way which you think is fundamentally right and best for your country. That is why I am here. That is why I take the path I do and it hasn't served Britain badly for 11 years.'
Did Mrs Thatcher think that we were at a juncture in Europe where the independence of the United Kingdom was at stake?
'If it came to saying that we agree with a single currency before we've even tried a common currency that would be a very, very important juncture. It would not be a hurdle that I could take and I don't think many of my party could take it. Because people haven't worked out what a single currency means. It means that not only do you give up your present currency, you have no power or control over your interest rate.
'Any difference which emerges between you and 11 very different countries comes out in another way. It comes out in unemployment, and you just have to sit back and take it. It comes out in vast movements of people as they leave the poorer countries and move to the better off ones …. Or, you have countries coming along to the rest of us and saying, 'You cannot do this, we must have enormous grants from you'. So, to give up, not only your own currency, but all the rights that go with it to a non-accountable central bank, where you would only be one of 12, would be quite fundamental. At least it should be discussed again and again, and the full impact put before the people, for this will be a matter for both Parliament and people.'
Here the Prime Minister talked of the British alternative proposal, the hard ECU [European Currency Unit]. I raised Sir Geoffrey's complaint that, on this, she had broken her own Chancellor's bat before he went into the crease. Mrs Thatcher hit back.
'If I may say so, it was a very, very silly thing to say. Because the first thing you do if you've got a broken bat is quite easy, get a proper bat. The Chancellor, who was sitting next to me, is a very good cricketer; he said, 'You just get a different bat.''
'But the point was that you appeared to dismiss the policy which you were about to embark on by saying that you didn't think the hard ECU would be very widely used.'
'But that was not a matter for me. It's a matter of choice. I thought it would be used for commerce, and by people who wanted to travel around Europe. What is it about all of these people who regard themselves as having superb freedom of speech but me having none? What poor wee things if they cannot allow other people the same freedom of speech as they demand before the assembled company for themselves. Poor wee bairns. Poor wee bairns. I venture an opinion that people in this country will probably prefer to keep their own currency. But it's a matter of choice.... I am prepared to put it to the choice of the people. Why are they not?'
I asked about the wider principle involved in questions of Europe. Would she put the constitutional issue to the British people, either at a general election, or a referendum?
'We're certainly not there yet. And frankly, we haven't even started the Intergovernmental Conferences. There is a great deal of argument still to be carried out.' Mrs Thatcher believed that she had a good chance of prevailing: 'It's often left to me, and people in Europe know it's often left to me, to say things which they don't and to make things clear which would otherwise remain cloudy.' But she added: 'I would not rule out a referendum. My views on referendums are really quite simple. I think you should only hold them on constitutional issues. I think they are right for constitutional issues because otherwise you cannot separate out a particular issue in an election…. It is a mechanism which enables you to put a single question to the people.'
She was not saying that there definitely would be a referendum, but at the time of British entry into the EEC, 'we were given certain undertakings then that our national identity would not suffer. I think those undertakings might not be able to be given if we went to a single currency'
Mrs Thatcher pointed out, however, how successful the current European policy had been. She cited better control of the Common Agricultural Policy, a better budget deal for Britain, the single market, and she insisted on the coherence of the policy: 'The policy which we have got now, which John Major and I have worked on together with the City, is a policy which everyone can unite behind. Everyone. And they were united behind it.
'It is a policy which we have deliberately worked out that could unite everyone, which doesn't pre-empt the final result. This is the policy which says that we have a hard ECU of common currency alongside national currencies. You will see how it develops from that…. The fact that some have broken ranks is not due to us.' It was her view of Europe that was positive: 'I do have an ideal of Europe; I don't think we are living up to it. I think that the way ahead that I want to go, which is co-operation between nation states, has done Europe very well, has brought it this far, will do it very well in the future. I think if you try to force things into a mould you will, in fact, succeed in having people rebelling against it, instead of being with it.' Europe's cultural greatness came from the fact that it had 'never been under one domination'.
It was time to turn to domestic issues, and Mr Heseltine's promise that he would institute a 'fundamental review of the poll tax'. How would she reassure worried Conservative MPs in marginal seats about this unpopular tax?
'We have in fact had a fundamental review of the poll tax. Michael was at Environment. He knows what rates were like. He knows they were absolutely appalling. He didn't come forward with anything else, and rates were still hated. It's very easy to say you'll come forward with a fundamental review. We have had one. The recommendations that were made there are being put through in legislation now.'
The Prime Minister criticised Mr Heseltine's suggestion that the poll tax be reduced by transferring education spending to central government.
'It will mean over four pence on the standard rate of income tax, and you have absolutely no way of knowing whether the local authorities will reduce the community charge or spend the extra money they have got. And you will find a quotation from Michael which says that if you judge from the past, you will find that they don't always reduce their rate core, or community charge core: they tend to spend more money. So you would have a very much bigger income tax and you would still have a high community charge.'
I brought the questioning back to the details of the coming contest: 'You have said that you will fight on if you only win on the first ballot by one vote. How could such conduct heal the split in your party?'
'I have not caused the split. It is not I who will cause an election.'
'What if a unifying figure like Mr Hurd is proposed?'
'Are you going to take certain people and say they unify? I have been here nearly 11 and a half years. I have had to fight the policies through. They have done very, very well for Britain. And the policies we have fought through have been the policies of the Cabinet.'
Wasn't there an able younger generation now waiting?
'The younger generation are very much for the things that I am doing. The younger generation is very much for free enterprise, for the rule of law, creating wealth before you distribute it, accepting that we have to have a budget, that we can't spend more freely. The younger generation is realistic, good.'
So wasn't it time to make way for one of their number? Mrs Thatcher's answer was dry. 'It is not being suggested that I hand over to one of the younger generation, with respect.'
Mrs Thatcher denied that the situation was the same as when she challenged Mr Heath in 1975. Then it had been the party that insisted on a leadership challenge. She had only been pressed into standing when Sir Keith Joseph decided not to. Besides, the present situation was '... very, very different from a Leader of the Opposition who had lost an election as Prime Minister. If I had lost an election as Prime Minister I would expect to be challenged.'
The Prime Minister emphasised her readiness to abide by the rules. I asked if, by the same token, she would insist on the rules being followed if she won outright on the first ballot, but by a narrow margin.
'If we win according to the rules, we win, and that's it.'
What if the famous 'men in suits' – the equivalent of the Milk Street mafia in 1974 – were to come to her and tell her that, because her victory was narrow, she should step down?
'The rules were not made by me. I abide by the rules. I expect others to abide by the rules.' That seemed admirably clear. My next question was rather abrupt: 'Five more years?' 'I beg your pardon?' (But I formed the impression that she had heard.)
'Five more years?'
'I'm so glad you think that we will win the vote on Tuesday and that we will win the election. I think that whatever I say you will trap me into saying something else. I am not everlasting.'
A message came that Mr Thatcher was in the private flat above, and wanted his supper. 'I'm sure he does,' said the Prime Minister, and allowed herself (and me) some whisky before leaving to do her domestic duty.
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