Profile: A fighter by his trade: Richard Needham revels in the dangers of dragging the DTI into the front rank. Richard Thomson reports

THE DEPARTMENT of Trade and Industry is, traditionally, the graveyard of ministerial reputations. Once-great names - Young, Tebbit, Ridley, even Heseltine, although he's still there - have been brought low trying to find their bearings in the fly-blown wastes of British industrial policy. Over the past decade, the curse of the DTI has come to seem one of the constants of political life.

So it is somewhat surprising to find a politician who is making a name for himself in this dangerous government department. Not only that, he actually seems to enjoy it. Along with Michael Heseltine, his boss, he is participating in a determined and so far successful attempt to drag the DTI out of its backwater into the light of genuine government initiative once more.

This unusual creature is Richard Needham, Minister for Trade. He has been in the job exactly a year and has already scored a notable success in reinstating export credit guarantees as an important tool in government attempts to encourage British trade. Under Margaret Thatcher, the Treasury had tried to wash its hands of the guarantees, which insure exporters (usually of valuable capital goods to Third World countries) against the risk of non-payment. It said there was no point in insuring exports for which companies were not expecting to be paid.

In the last Autumn Statement, however, the Chancellor unexpectedly raised export credit cover by pounds 700m, in a sharp reversal of policy that was almost the first concession extracted from the Treasury by the DTI in 13 years. In the last Budget this policy change was confirmed, as cover was raised again by pounds 1.3bn.

Richard Needham was leading the charge. He would no doubt have been less successful if he had not had the backing of Mr Heseltine, the President of the Board of Trade (whom Needham refers to as 'him indoors') and, almost certainly, of John Major himself.

When it comes to industrial and trade policy, there is a new energy high up in the Government. Needham is one of its most active agents. He has said he wants to increase Britain's share of world trade in capital goods, and that from now on the Treasury will have to cough up the money he needs. It is a characteristically tough remark from a man noted for a somewhat bullying manner.

His toughness works. Early this year he carried out a study to find out how much exports were likely to grow in the next 10 years, and in which goods and which markets. It landed on the Chancellor's desk two weeks before the Budget and was instrumental in extracting the extra pounds 1.3bn export cover.

Not surprisingly, this has endeared him to exporters. Once known by some in the export community as 'Needless', Needham's success in producing government support has changed that attitude. 'I'm not suggesting he's a saint,' said one banker involved in several of Needham's initiatives. 'But compared with what we had at the DTI in the past, he probably is.'

He does not look particularly like a saint, with receding hair and a somewhat shapeless face. He is clever but impatient, and does not like to be contradicted. He is bullying with civil servants. 'One's got used to his style: a bit of abuse doesn't go amiss,' observed one long-suffering target. But his energy is unquestionable and he revels in his reputation as something of a maverick.

At the core of his approach at the DTI is the aim of restructuring government's relationship with industry. He wants more interaction and more industry involvement, so that politicians and civil servants can serve the aims of industry.

One pet project is reorganising the Overseas Projects Board. Once an unwieldy group, it is being restructured into sub-groups dealing with particular capital goods sectors, such as oil and gas, transport and telecoms. They contain industry representatives who are supposed to co- operate with each other in exporting projects. 'Their job is to bring industry together, so we don't knock hell out of each other instead of out of the enemy when it comes to bidding for foreign contracts,' Needham explains.

He has also established trade organisations to help British industry penetrate particular overseas markets, such as the China-British trade board financed partly by the DTI with representatives in the Far East.

His attitude has given new heart to companies trying to sell large capital items overseas. Needham has found an eager constituency.

Although a member of the House of Commons since 1979, when he was elected MP for Chippenham, he is in fact a peer - the 6th Earl of Kilmorey. Through a constitutional quirk, many Northern Ireland peers are allowed to sit in the Commons. Politics is a family tradition. His great-grandfather was the last Conservative to represent Newry, where the family estate is located. The estate passed to another branch of the family, and Richard Needham was born in Hertford in 1942 and did not set foot in Ireland until his twenties.

After school at Eton (where the King of Nepal was his fag) he was supposed to keep up a family tradition by joining the Army. But Needham had conceived an interest - unusual for his time and class - in industry. In any case, the family wealth had run out and he needed to earn some money. After failing to get into university or finish his law exams he got a traineeship at Rothmans, the tobacco group. In the course of designing new packaging for pipe tobacco, he went to Belfast for the first time. After five years at Rothmans he spent another three at an engineering company, Sterling Industries. 'It gave me a full understanding of British industry in the mid-Sixties,' he says.

Already something of a veteran at the age of 25, he set up his own company, RGM, in packaging design. He developed a way of making melamine-coated estate agents' signs that were bigger and lighter than the old enamelled metal ones, and they sold well. RGM bought a greeting cards company then went into melamine- laminated giftware. Needham had made his pile.

By the early 1970s he was getting interested in politics. He had once attended a two-week Harvard Business School course on worker motivation, which sparked an abiding interest in what makes people work hard and efficiently. His first service to the Conservative Party was a paper he wrote on worker participation. He became Jim Prior's personal assistant. His interest in labour - unusual for a Tory - continued: 'I used to go to all the TUC conferences. The trade unionists used to call me the Tory Trot.'

To gain a better idea of retailing he did a two-week secondment at Marks & Spencer, coming away with the highest opinion of the company. (His spell selling M&S underwear provoked the occasional nickname 'Knickers Needham').

He won his first seat, Chippenham, in 1979. But although he was one of Mrs Thatcher's new MPs, he was firmly associated with the 'wet' patrician end of the party. Moreover, he was interested in industry, which Thatcherites were not. 'I did not believe you could only run Britain on service industries. Naturally I was out of favour.'

Accordingly, he was sent to the Siberia of British politics, Northern Ireland. And he stayed for nine years - the longest any minister has spent in the province since Direct Rule began. 'I fell in love with the place and its people,' he says. As the years rolled by, he became a very influential figure there.

He did almost every ministerial job in the province, from Health to Social Security and Environment.

For the last three years he was responsible for industry, which gave him a chance to put some of his ideas into practice. Broadly, they were similar to what he is attempting at the DTI, improving the relationship between government and industry and giving industry more say. He also worked hard to attract investment to the province, successfully persuading such companies as Marks & Spencer and Fruit of the Loom to expand their operations there.

He remained thoroughly Tory, however, in pruning government financial support for local industry. He masterminded the privatisation of Northern Ireland Electricity, whose management he held in utter contempt. To shake it up and introduce competition, he split electricity services in the province into several parts before privatising them.

This provoked criticism in Northern Ireland and among some of his advisers, although this was not always expressed. Needham is sometimes hard on his civil servants and is known for often overruling their advice. He has a sharp wit and a sometimes acid sense of humour. When he visited Newry in 1987 he won applause when he joked, 'I've come for the back-rent' - from a less socially conscious minister it might not have seemed so funny.

He hit the headlines in 1989, however, for remarking in a private telephone conversation with his German wife, Sissy, that he wished the 'Silly Cow' - Mrs Thatcher - would resign. A paramilitary group recorded it from a car phone and passed it to a Belfast news agency, which passed it to the British press, which had a field day. Needham feels it was a simple invasion of privacy.

Fortunately for him, perhaps, Mrs Thatcher resigned not long after. Needham was at last pulled back from Northern Ireland to the DTI after the last election and his political career has, in a sense, restarted. And none too soon for British industry. Along with Heseltine, there is at last a minister at the DTI who not only cares about industry but has first-hand experience in business. It just might signal a new beginning for a government department whose days had once seemed numbered.

(Photograph omitted)