Shephard angry over handling of pits package

GILLIAN SHEPHARD, the Secretary of State for Employment, has made it clear to colleagues that she supports the pit closure decision, but is furious at the way it was handled by Michael Heseltine, President of the Board of Trade.

Mrs Shephard was annoyed that he assembled the pounds 1bn redundancy package announced last Tuesday without consulting her. Her anger increased when she was pressed by the Treasury to help fund the additional aid to be announced today by Mr Heseltine.

Mrs Shephard's friends say she believes the whole package should have been carefully worked out before the announcement so that it could have been presented at the same time as the closure announcement to ease the pain.

Mrs Shephard was well aware the storm was about to break. She was on the small inner Cabinet committee on energy that took the decision. She was unable to attend the key meetings, but her department was represented by Patrick McLoughlin, a junior employment minister and the MP for Derbyshire West, who is a former miner.

Mr Heseltine confirmed yesterday that Mr McLoughlin played an active role in the discussions. The departments exchanged papers which were in the red boxes of the Cabinet ministers involved.

The President of the Board of Trade also confirmed in the BBC Television On the Record programme that Norman Lamont, the Chancellor, attended key meetings of the group, which included Michael Howard, Secretary of State for the Environment, Allan Stewart, Minister of State for Scotland, and David Hunt, the Secretary of State for Wales, who was not told about the closure of one pit in Wales.

Mr Heseltine that said Mr Hunt should have been told by British Coal that it had decided to include the pit in its closure list. When the decision was agreed, John Major called for it to be reviewed. After a final review, he decided that no alternative was available and agreed to the closures by British Coal. That decision has called into question Mr Major's political judgement.

British Coal submitted a similar plan to Lady Thatcher when she was Prime Minister, but, in spite of defeating the earlier miners' strike, she rejected it because of the political risks.

Neil Clarke, the British Coal chairman, complained that only Peter Lilley, the Thatcherite Secretary of State for Social Security, appeared to appreciate the risks when it was put again to Mr Major's Cabinet team on 3 June.

Mr Heseltine yesterday repeated the line he adopted then: that it was not for the Government to intervene in the business decisions of British Coal. His 'hands-off' approach - in spite of his reputation for intervention - may have been part of the attempt to avoid the Government being blamed. If it was, it failed.

Douglas Hurd, the Foreign Secretary, said in an interview on ITV's Walden yesterday that the fact that Mr Major reopened the decision for a final review proved he was aware of the dangers.

Alan Clark, the former Thatcherite defence minister who retired at the election, called on the Tory backbench to demand Cabinet sackings. 'The usual combination of menace and cajolery will be deployed,' he wrote in the Mail on Sunday newspaper. 'But my advice would be, don't whip the troops, shoot the officers.' Mr Clark, regarded as an outspoken maverick, echoed many Tory backbenchers.

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