MI5 has always carefully guarded its secrets. In her memoir, the ironically titled Open Secret, the former head of the security service Stella Rimington assessed the role of MI5 during the 1984-85 miners’ strike: “We limited our investigations to the activities of those who were using the strike for subversive purposes. The reports we issued to Whitehall during that time were most carefully scrutinised to ensure they referred only to matters properly within our remit.”
This was the official version of events. Yet buried in the National Archives at Kew is a secret document that casts new light on Rimington’s account of MI5’s role during an industrial dispute that represented the most serious challenge to Margaret Thatcher’s premiership. At a moment in which we are commemorating the 40th anniversary of the miners’ strikes, it is very much worth looking at this document closely.
Stamped “Secret and Personal”, the document was a memo by Robert (later Lord) Armstrong, the then cabinet secretary, sent to Thatcher in February 1985. I discovered the report while working on a Channel 4 series about the miners’ strikes, which threatened the British state as nothing had since the second world war. I always suspected MI5 had played a more interventionist role, but coming across this document was a revelation.
Armstrong detailed a series of secret meetings in Whitehall with an unnamed MI5 officer. Their conversation did not concern foreign spies, subversion, national security or official secrets. The agenda was how to find the funds and assets of the National Union of Mineworkers (NUM). A lawsuit – orchestrated by David Hart, the machiavellian political adviser to Thatcher – had succeeded in declaring the dispute illegal because a national ballot had not taken place. When the NUM refused to call off the strike, the high court found the union guilty of contempt of court and issued a £200,000 fine. And when the NUM refused to pay up, a judge ordered its funds to be seized by the court-appointed sequestrator.
In anticipation of the court order, the NUM had transferred the union’s £8.7m through seven countries before it ended up in banks in Dublin, Zurich and Luxembourg. It was a covert and deliberately convoluted operation involving NUM officials taking private flights from Jersey to obscure banks in Luxembourg.
At first, the complex scheme to hide the miners’ cash was successful. The accountancy firm Price Waterhouse, in charge of the investigation, could not trace the movement of the money. And so its senior partner Brian Larkins asked the government for help.
In circumstances of strict secrecy, Armstrong introduced an MI5 officer to Larkins in the cabinet office. Larkins did not know his name or which agency he worked for – only that he would receive secret intelligence that would trace the miners’ funds. In exchange, Larkins agreed to provide information to MI5 that might help the agency identify any foreign backers of the NUM.
Suddenly, Price Waterhouse was able to track down obscure NUM bank accounts and freeze the assets, sometimes without the union even realising. Bankers were mystified. How did Larkins find the secret accounts? After the strike, he was asked about his source. “It is a difficult area,” he replied.
The answer is contained in Armstrong’s secret memo to 10 Downing Street: MI5 leaked confidential details of NUM bank accounts and the movements of union officials to Price Waterhouse, seemingly based on covert surveillance and phone tapping.
The document reveals how Armstrong was nervous about MI5’s operations being disclosed. He told the prime minister that partners of Price Waterhouse were aware of his meetings with Larkins. They knew their colleague had met “an unnamed man” and information had been disclosed.
The “unnamed man” was, of course, an MI5 officer. He disclosed to Price Waterhouse intelligence “obtained during inquiries into sources and movements of NUM funds particularly overseas”, wrote Armstrong. “Mr Larkins was not told who the unnamed man was. But it does not take a Sherlock Holmes to deduce that he was a security service officer and that at least some of his material could have been, and probably was, obtained by interception of communications.”
The sensitivity about the disclosure of MI5’s involvement in bugging the phones of trade unionists, tracking their movements and tracing their bank accounts was acute in Whitehall. Armstrong was especially concerned about an attempt by Price Waterhouse to seize funds deposited by the NUM in bank accounts in Dublin. The union resisted the claim in the Irish court and the judge indicated he would ask about contacts between the British government and the sequestrator (Price Waterhouse). The problem is the sequestrator would be under oath and so their cover would be blown.
The cabinet secretary felt trapped and spoke to government lawyers. If his dealings with Price Waterhouse emerged in court, it might lead to disclosure of MI5’s eavesdropping of the NUM.
“It could be argued it was a legitimate use of interception to seek to discover what assistance the NUM was receiving from overseas in the provisional movement of funds,” Armstrong wrote. “It would be more difficult to justify the use of information obtained by interception to assist the searches of the sequestrators.”
Three days after receiving that memo, on 4 February 1985, Thatcher met the attorney general to discuss the predicament. They agreed to stand firm: no information should be given in court or in parliament about contacts between the government and the sequestrators.
Fortunately for Thatcher, the sequestrators were not required to reveal in court their dealings with the government and MI5. For years, the pretence that Price Waterhouse had uncovered the NUM accounts and banking transactions by their own sources was maintained. It was not until 1991 that the Guardian revealed how vital information used by Price Waterhouse about the NUM confidential accounts was derived from GCHQ surveillance.
Today, 40 years after the miners’ strike, the Armstrong memo reveals how MI5 abused its power to help the government win the conflict. The document undermines the official version that the security service’s role was restricted to countering subversion and stopping an attempt to overthrow parliamentary democracy. And it should result in a reassessment of the secret state’s role in a pivotal moment in British history, the outcome of which – Thatcher’s victory over the organised working class – laid the foundations for the country we live in today.
Mark Hollingsworth is a freelance journalist and the author of books including Defending the Realm, Londongrad: From Russia with Cash and Agents of Influence: How the KGB Subverted Western Democracies.
