The British Government and the Falkland Islands, 1974-79

A. Donaghy

• Publisher: Palgrave Macmillan
• Year: 2014
• Print ISBN: 9781137432506
• eBook ISBN: 9781137329561
• Topic: Politics & International Relations
• Subtopic: British History
• Index: Politics & International Relations

Drawing on recently declassified government files, private papers and interviews, this book argues that through a combination of preventative diplomacy and robust defence planning, the Labour government of 1974-79 succeeded in maintaining peace, avoiding the fate of its Tory successors.

1

‘Leave This Poisoned Chalice Alone’

January–September 1974

‘HW is very perky in the day and then usually slumps around 9 p.m.’, noted policy adviser Bernard Donoughue, days after Wilson’s return to office. ‘If he drinks he becomes very strange and aggressive. His brow lowers and a very strange look comes into his eyes. Rather hunched and brooding.’¹ The prime minister had plenty to brood about. Aside from heading the first minority government since 1931 (prompting another general election in October), Wilson had inherited an austere economic predicament, bequeathed to him by the policies of the Heath government and the world oil crisis. ‘Britain was facing an unparalleled economic crisis’, he recalled, ‘confronted by fourfold oil-price increases and by balance-of-payment problems unprecedented in our history’.² Divisions within the party did not help. Tony Benn led a powerful left-wing movement, which called for radical socialist policies to be implemented.³ Wilson’s task was to therefore achieve a sound balance in the party, and hold it in place amid the economic turmoil. Probably no post-war prime minister had taken office in more difficult circumstances.⁴

Wilson’s return to government contrasted with the triumphant scenes of a decade earlier. Resuming his place in Downing Street, he declared that on this occasion there would be ‘no presidential nonsense’, no ‘first hundred days’ and ‘no beer and sandwiches at No. 10’.⁵ Only the pipesmoking remained. But Wilson had visibly changed. He was an older, fatter man now. Donoughue recalled the prime minister ‘tired and often unwell, seeing nothing left to prove as a politician other than to achieve certain records of time in office – and knowing that after October 1974, he would not stand for office again’.⁶ Wilson consciously adopted a more withdrawn role this time around. Invoking a football analogy, he expressed his intention to play as ‘a deep-lying centre half’ instead of a goal-hungry centre-forward.⁷

His foreign secretary was James Callaghan. An erstwhile political rival and at 62, four years Wilson’s senior, Callaghan had served as chancellor of the exchequer and home secretary during the 1960s. Yet by the mid 1970s their relationship had been recast. ‘They were not friends: but they had given up being enemies’, quipped author Ben Pimlott.⁸ On domestic and foreign issues they were in tandem. The Common Market referendum and the need to contain the Left drew them closer together. The Wilson–Callaghan partnership has been compared with that of Attlee and Bevin from 1945 to 1950. At the Dublin European Summit in March 1975, Wilson remarked: ‘Jim and I are a complete partnership. We pass the ball to each other.’⁹ But it was Callaghan who had most of the possession. His biographer Kenneth Morgan wrote: ‘As the prime minister’s energies showed signs of running down [ … ] Callaghan emerged as the all-purpose operator to fill any gaps and give direction to the government. He was almost an alternative prime minister.’¹⁰

Callaghan hailed from a different era. He remained a man of 1945, the year he had entered parliament, ‘the genuine article owing to the poverty of his early life in a widowed household in Portsmouth [ … ] a young trade union official in the interwar period, his service at sea during World War II’.¹¹ This genuineness was a trait observed by Donoughue. ‘On the surface was the familiar bluff and avuncular Jim. Below that was a shrewd, secretive and even wily politician. And beneath those layers was an authentic and very decent person who really did believe in the straight honest values in life.’¹² As foreign secretary, Callaghan set about restoring the ‘special relationship’ with the United States. In Labour’s election manifesto he declared that Ted Heath should be ‘left hanging slowly, slowly in the wind’; a phrase which had just entered American political lexicon.¹³ Even allowing for Watergate, relations had become strained during the Heath years, and Callaghan was anxious to rebuild the transatlantic partnership, an objective facilitated by his rapport with Henry Kissinger. Although Callaghan spoke of historical and cultural ties, the ‘more practical aspects’ (joint defence, intelligence, regional security, economic cooperation) were of the greatest significance.¹⁴ As with almost every British foreign secretary since Suez, he grasped the importance of obtaining the support of Washington before becoming embroiled in any military crisis.

Yet the most pressing foreign policy issue was that of Britain’s place in the European Economic Community. The early months would see the government spend much of its time attempting to renegotiate the terms of entry executed by the Heath administration. By 1974 Britain’s global commitments had been scaled back, and this trend would continue throughout the rest of the decade. As in his first spell as prime minister, Wilson sought to reduce defence spending to an affordable level, cementing the reorientation towards the Western alliance, and the virtual abandonment of a strategic role East of Suez.

From 1956 to 1961 Callaghan had served as shadow colonial secretary; a background which, with Labour Party support, enabled him to pursue the cause of decolonisation, most notably in Africa.¹⁵ Callaghan, with his gregarious demeanour, ‘never sounded or looked like any kind of imperialist’. He argued that while smaller colonies should be granted self-government, the transfer of power in each case had to be carefully crafted.¹⁶ But Callaghan could also strike a robustly patriotic note. His stances over Belize in the face of American opposition, and the Gibraltar dispute with the Franco government, were prime examples. The contacts made as shadow colonial secretary proved useful in facilitating his advancement of Commonwealth affairs; designed to ensure that British ideas met with a more sympathetic response from Commonwealth countries at the United Nations.¹⁷

In the case of the Falkland Islands, this would be an exercise in futility. The limited room for manoeuvre was exacerbated by a complete absence of international support. As with previous governments the broad aim was to bring Argentina and the Falklands closer together. Yet during his two years as foreign secretary, Callaghan’s relationship with the Foreign Office remained ‘wary and ambiguous’, and he applied the expertise selectively.¹⁸ Mindful of the domestic and parliamentary elements, Callaghan would exercise caution whenever concessions on sovereignty were being advocated by diplomats. His approach was geared towards managing, rather than resolving, the fundamental problem. ‘Ours in essence would be a policy of deterrence, of preventative diplomacy’, Callaghan recalled.¹⁹ ‘My assessment was that, provided the Argentines believed that we were willing to keep discussing these matters, and to find various formulae which would enable them to satisfy their public opinion, then the issue would not come to a head.’²⁰

Against a background dominated by the oil crisis and the spectre of an economic slump, the Falklands were, in Callaghan’s words, ‘dots on the map’.²¹ But he was aware that in March 1974 the Labour government had inherited a dangerous situation. By the end of 1973, with the Anglo-Argentine dialogue having collapsed, it was believed that attitudes in Buenos Aires were hardening, and that the Perón government might be preparing contingency plans for an invasion of the islands.²² The Foreign Office had to deal immediately with the condominium initiative, bequeathed to them by the previous administration. Because this formula was devised at the beginning of the year, a closer look at its instigation is a prerequisite.

Condominium

The dying weeks of the Heath government saw condominium as a novel way of breaking through the impasse. The previous October, Argentina had secured a UN resolution calling for ‘accelerated progress’ in resolving the dispute.²³ A memorandum by foreign secretary Alec Douglas-Home, for the Cabinet’s Defence and Overseas Policy Committee (DOP), summarised the predicament. On the one hand, islanders had made it clear that they would not contemplate new talks on a transfer of sovereignty. On the other, Britain’s ambassador in Buenos Aires, Sir Donald Hopson, warned that Argentina would not continue the dialogue on any other basis. The Foreign Office task was a dual one: keeping the Argentines in play by demonstrating a willingness to cooperate, while trying to engage the islanders without putting them under undue pressure.

Islanders would ultimately have to be consulted, given the promises made to parliament post 1968. Yet Douglas-Home conceded that there was ‘a risk that the Argentines might be tempted to make a descent on the islands’. The sheer remoteness of the Falklands and its inadequate airfield made it doubtful that Britain could successfully resist an invasion. Argentina could also resort to damaging non-military manoeuvres. These ranged from the suspension of the recently established air-service, to action against British commercial interests in Argentina, to the withdrawal of logistical services to islanders, such as education for children and the use of medical facilities. Douglas-Home concluded that doing nothing would endanger the interests and security of the islands. He believed condominium was the best way of continuing a dialogue with both parties, reasoning that it would have a greater chance of acceptance from islanders than talks on an outright transfer of sovereignty.²⁴

At a basic level, a condominium is joint sovereignty over a territory and people by two or more states. There were few successful precedents. The Anglo-Egyptian Sudan (1895–1956) and the Anglo-French New Hebrides (1914–80) were amongst the longest-spanning modern cases, but were scarcely ideal models. They embodied all the difficulties of everyday administration between two parties, such as immigration and defence, and generated a mass of legal and political problems to which ministers objected. But condominium was still considered the most suitable option. Though it would mean admitting Argentine co-sovereignty, islanders could retain their self-government status and withhold their right to make a constitutional choice about their future. A treaty would be drawn up; British and Argentine flags flying side by side, English and Spanish becoming the official languages. ‘All belongers’ would have dual nationality, losing the right to diplomatic protection against the Argentine government.²⁵ The wording made interesting reading. At no stage in the memorandum was there discussion of a permanent or expanded Argentine settlement on the islands. Given that the Falklands population was set at just 1,900, a swollen Argentine contingent would spell difficulties.

There were other problems. Islanders would retain as far as possible their constitutional, administration and legal systems, but these would have to be adjusted to suit the practical workings of a condominium. The Falklands governor, the local authority, would have to be rotated, appointed by the Queen and the Argentine government. Everyday administration would need to be supervised harmoniously by the British parliament and the Argentine congress, and subsequent changes required the full agreement of the co-domini. Argentine economic problems and British overseas cutbacks suggested that responsibility for providing capital aid might prove a sticking point. Finally, possible oil resources situated on the Falklands continental shelf had already provoked interest from Argentina and the islanders alike.²⁶

Having weighed up the permutations, the Foreign Office decided that condominium was worth exploring. If talks succeeded the islanders would retain British nationality, albeit of a dual kind. It would also reduce the likelihood of Argentina resorting to military force. Even if the latter rejected the idea, Britain’s position at the United Nations would be enhanced, making it difficult for Argentina to justify any direct action against the islands. But condominium would require both sides to make some compromise on their sworn sovereignty positions. Whilst Argentina might show some interest (possibly as ‘a step towards gaining absolute control eventually’), any development would require the full agreement of the islanders. Douglas-Home’s memorandum argued that via the Communications Agreement, Argentina had been ‘unexpectedly successful in winning the friendship of the islanders’.²⁷ This was misplaced confidence. For all its logistical benefits, locals had made clear in October their desire to remain British.

Encouraged by the framework of cooperation that had supposedly been built, the Foreign Office pressed ahead. But it was soon reminded of the parliamentary dimension. Within four days Douglas-Home received a letter from chief whip Humphrey Atkins, who admitted that the memorandum made him ‘nervous’. Atkins believed that back-benchers in the Commons would be highly critical of the proposals. ‘We ought not to be discussing the question of sovereignty at all unless the islanders are agreeable’, he warned. ‘All the indications are that they are not. Any public suggestion [ … ] might well be thought (by our more suspicious supporters) to be bringing pressure to bear on the islanders. In any event, we ought not to be discussing the question of sovereignty with a country who has publicly announced that it rejects the right of the islanders to have any say in their own future.’²⁸ The signs were not promising. On 4 January the Falklands Legislative Council (LegCo) had met in Stanley, discussing the conditions under which islanders might agree to resume a dialogue. But despite ‘maximum arm-twisting’, Falklands governor Ernest Lewis was unable to wring concessions from councillors about talks on a possible sovereignty transfer.²⁹

Lewis’ role was an interesting and conflicting one. Ever since the 1830s the islands had been under the control of a London-appointed governor. He had to combine his role as British government representative with that of representing the Falklands community, and conveying their interests and wishes. Liaising with the foreign secretary carried its own risks, and locals usually knew when something was amiss. Previous governors, such as Geoffrey Clifford, had complained that the office was too exposed to direct and personal criticism from the small, vigilant community.³⁰ Adrian Sindall, an official in the Latin American Department (LAD), recalled: ‘Most governors found it very difficult to square that particular circle and they would either become great advocates of the islanders to the despair of the Foreign Office in London, who thought they were supposed to be telling the islanders what to do, or they would be robustly telling the islanders what the Foreign Office or the government wanted to the despair of the islanders, who would then be very unhappy about the governor. I don’t think any governor got this right, one way or another.’³¹

For all the scepticism, the DOP meeting on 10 January struck a hopeful tone. In discussion with Douglas-Home, it was argued that ‘the probable attitude of the islanders to condominium was not known’.³² This was a judgement which flew in the face of all logic, since Falklands councillors had repeated their position just days earlier. There seemed little basis for optimism. Condominium was raised at a joint council meeting the previous October.³³ The governor’s deputy Thomas Layng had spent six years working in the New Hebrides, and he explained to councillors how the condominium form of government worked.³⁴ Yet this made little headway, and Lewis reported that there had been no mention of it since. Back in London, ministers were wary of a political backlash, fearing the repercussions if it appeared that islanders were being pressed to accept condominium against their wishes.³⁵ But the prime minister had been won over by Douglas-Home’s warnings about the dangers of inactivity. Heath authorised the foreign secretary to discuss with Lewis the islanders’ likely attitudes to condominium. Depending on this outcome, the matter could be raised with Argentina and the islanders.

Douglas-Home explained the British position to the governor: ‘We would not talk to the Argen...

Table of contents

• Cover
• Title Page
• Copyright
• Contents
• Acknowledgements
• List of Abbreviations
• Maps
• Introduction
• 1. ‘Leave This Poisoned Chalice Alone’: January–September 1974
• 2. The Lowest Common Multiple: September 1974–July 1975
• 3. A Sensational Hostage: July 1975–February 1976
• 4. Islands Surrounded by Advice: February–June 1976
• 5. The Mixed Approach: June 1976–January 1977
• 6. Absentee Landlords: January–August 1977
• 7. Defence of the Realm: August 1977–January 1978
• 8. ‘No Talks, Just Football’: January 1978–May 1979
• Conclusion
• Notes
• Select Bibliography
• Index