Political Commentary: Heseltine tries to dig his way out

ONE of the few jokes regularly told by Ian MacGregor, chairman of the National Coal Board during the 1984-85 miners' strike, was the one about the three lies of modern life: I'm working late at the office; the cheque's in the post; and I'm from the government and I'm here to help you.

The line suited the times, conveying a Reaganite contempt for bossy government. But it also had a subliminal message about the industry that Mr (now Sir Ian) MacGregor had been appointed by Mrs Thatcher to run; if the holy war with Arthur Scargill could be won, then the mines would at last be made fit for the free market. The days of subsidies and ministerial interference would be over.

It is that dream which some of Michael Heseltine's many enemies in the Tory Party see threatened by the humiliating announcement that the President of the Board of Trade will be forced to make next month. Perhaps a dozen of the 31 pits lined up in October for closure will be reprieved. The taboo word 'subsidy' will be unavoidable. At once cursing Mr Heseltine, whom they have never forgiven for his part in the events of November 1990, and revelling in his discomfiture, the Thatcherites will talk darkly of an industrial U-turn to parallel that of another arch-enemy, Edward Heath, in 1971-72.

There is something fickle about this; the backbench free- marketeers who are now so unhappy at the prospect of keeping mines open did not exactly stand by Mr Heseltine when the original decision to close them was announced. The decision may have been in tune with their own thinking, but they disdained to share with him the public odium that it aroused. They have since recovered some of their nerve and are looking to ministers such as Michael Portillo and Michael Howard to ensure in the next fortnight that Mr Heseltine does not give away too much, or for too long.

Fickle or not, these forces will not make Mr Heseltine's task any easier. He has to satisfy the Tory rebels against the original closure plan that he has genuinely rethought it; yet he is also constrained by those seeking to minimise the U-turn, and by his own need to demonstrate that the basic judgements which led to the decision in the first place were correct. The is a hard act, essential to his own political credibility, over which much doubt is currently cast on the Tory backbenches.

The case that Mr Heseltine is a politician on the way down can be quickly summarised. First, his pit closure announcement ranks as one of the worst ministerial misreadings of public sentiment of recent times, and the fact that neither his colleagues nor most commentators expected the reaction it provoked does not absolve him. He was the responsible minister and he can never fully recover from the blow. Second, his tenure at the Department of Trade and Industry has disappointed the expectations that he himself created for it, both in his writings as an exiled backbencher (which envisaged the department, along with a beefed-up National Economic Development Office, as a motor of industrial expansion) and in his rhetorical flourishes at the Tory conference about intervening before every meal. By contrast, it is said, NEDO has been abolished and the ministry's interventions are tentative at best. Mr Heseltine has turned out to be just another fallible politician. Is it not therefore obvious that, finally cheated of the party leadership, he has lost interest and may even cease to earn his Cabinet place before the Parliament is over?

This may be to underestimate his powers of recovery. He has been written off before. Not many of his colleagues expected him, when he resigned over Westland in 1986, to conduct his long march back to office four years later. He did not win the glittering prize but, as he reminded his friends, he changed history. Then again, the game seemed to be up when he confronted a vengeful audience with a lacklustre speech at the Conservative Central Council in 1991. A year later he barnstormed through the general election and received the job he had told Mr Major he wanted.

To understand his approach to that job, it is worth recalling what he is and is not. He was never an Sir Ian Gilmour-style wet, which was one reason why a die-hard young Thatcherite like Edward Leigh, now a loyal DTI minister, voted for him in the second Tory leadership ballot. As Environment Secretary in the early Thatcher years, he promoted the sale of council houses. His use of private sector investment through the Urban Development Corporations foreshadowed today's fashionable talk of partnership between the private and public sectors. He was passionate about privatisation throughout the 1980s. Alone of spending ministers he served notice after the general election that the DTI would not require an increase in budget.

Even so, his long-term commitment to making the DTI work along the lines he led us to expect should not be underestimated. He has probably given up hopes of the party leadership; he is one of the few Cabinet ministers who does not want to be Chancellor. The DTI is his baby. The conventional wisdom is that nothing much is happening there. The absorption of NEDO staff into the department, the creation of 'one- stop shops' for advice to businessmen, the reorganising of the department, and the creation of an industrial competitiveness unit are hardly the stuff of headlines.

But what is this in the latest issue of the fiercely pro-market Economist? An article suggesting that these do indeed add up to an industrial policy, and in effect worrying that Mr Heseltine might not be trying to do too little, but too much. On export credit, it is safe to assume that having secured an extra pounds 700m in the autumn statement, he and his trade minister, Richard Needham, will continue to press for more, their hand strengthened by Mr Major's new role as international salesman. Moreover, Mr Heseltine remains at the heart of the Government, taking part in Cabinet committee discussions on Bosnia, for example. The most famous resigner of recent political history, Mr Heseltine has also surprised his colleagues by his insistence on team play under John Major.

Finally, the coal crisis diverted Mr Heseltine as well as damaging him. His intervention speech in Brighton came on the eve of the Cabinet committee decision to press ahead with the coal closures. Ever since, he has been preoccupied with little else. Friday's report by the all-party Commons Trade and Industry Select Committee was a help because it accepts the prospect of some closures and points to a solution. But the issue is still fraught with hazard, some of it still promoted by old envies. In the words of one ministerial defender: 'He's rich, good-looking, makes good speeches, and has some ideas. No wonder he attracts jealousy in the modern Conservative Party.' That may be true but things are not that simple; Mr Heseltine will have to use all his skill to convey to his critics on the right that he is not trying to prop up an ailing industry, only cutting the existing subsidy to coal a little more slowly than he originally planned.

But Mr Heseltine has two big advantages: one is that he has the backing of John Major and Lord Wakeham for a pit rescue. The second is that much as his enemies might like the idea, he cannot, for the Government's sake, be allowed to go down to a second defeat on this issue. Assuming he can get through the next three weeks, he will remain, for a painfully vulnerable administration, an asset rather than a liability.