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Nigel Lawson, chancellor and journalist, 1932-2023


Lord Lawson of Blaby, who has died at the age of 91, was one of the most consequential and longest-serving British chancellors of the 20th century, playing a pivotal role in Margaret Thatcher’s free-market revolution.

Revered by the Tory right and an inspiration to current prime minister Rishi Sunak, Nigel Lawson pushed through a vigorous privatisation programme and presided over radical tax cuts at the end of the 1980s.

Intellectually one of the best-qualified of all chancellors, Lawson played an important role in managing the successful recovery of the UK economy from the depths of the early 1980s recession.

Ultimately, however, his nearly six and a half years in Number 11 Downing Street — the second-longest term of any chancellor of the 20th century — ended in a familiar and disappointing boom-and-bust cycle.

The ill-fated “Lawson boom”, fuelled by two big tax-cutting Budgets in the late 1980s, did little to tarnish his reputation among a modern generation of Conservative leaders. Sunak, during his own time as chancellor, hung a portrait of Lawson above his desk.

If anything, Lawson’s standing on the Tory right grew in the last decade of his life: he championed Brexit and was a leading sceptic of man-made climate change.

From a prosperous Jewish background, Lawson gained a first in PPE at Oxford and was one of the numerous clever Oxbridge graduates recruited to the Financial Times in the 1950s by then editor Sir Gordon Newton.

In four years he progressed from junior feature writer to industrial reporter, oil correspondent, features editor and, finally, chief Lex columnist.

In 1960 he left to join the new Sunday Telegraph as City editor, a job he held until October 1963 when he went to the Conservative Research Department to help the party fight the next election. Soon after the 1964 polls, he succeeded Iain Macleod as editor of The Spectator.

He entered parliament in 1974, abandoning a declared ambition to become editor of the Financial Times. His pro-Europe views — which later shifted to profound Euroscepticism — also caused friction: as early as 1981 he was privately urging then chancellor Sir Geoffrey Howe to join the European Exchange Rate Mechanism but was rebuffed by Howe and Thatcher. These arguments became much more bitter later in the decade.

First, however, came an interlude when in September 1981 Lawson entered the cabinet as energy secretary, with a brief to get a grip on the privatisation programmes involving North Sea oil, British Gas and the electricity industry.

He was also involved in pre-planning for the miners’ strike which eventually came in 1984 — after the extensive precautionary build-up of coal stockpiles at power stations.

The early privatisation issues proved tricky to manage: Amersham International was embarrassingly underpriced in 1981 and, when in 1982 Lawson decided to sell Britoil through a tender offer, to avoid the risk of a big premium, the issue was badly undersubscribed. But the flotations of British Telecom and British Gas — the latter coming after Lawson had left the energy department — set a pattern of strong public appeal.

Nigel Lawson with his wife Therese before presenting a Budget in the Commons
Nigel Lawson with his wife Therese before presenting a Budget in the Commons © PA Archive/PA Images

Lawson was surprised to be appointed chancellor after the 1983 election, but seized his opportunity with the radical Budget of March 1984. The wholesale reform of corporation tax, including the abolition of stock relief and investment allowances, set the tone for his chancellorship.

He presided over the massive “Big Bang” liberalisation of the City of London in October 1986 and boasted that he abolished a tax in each of his six Budgets. Other significant changes in later years included the ending of life assurance premium relief and the introduction of personal equity plans. In 1988, he cut the top rate of income tax to 40 per cent.

But he was thwarted by Thatcher in his attempts to reduce mortgage interest relief, something that might have moderated the subsequent house price explosion.

From about 1986, however, Lawson began to make important mistakes. Sterling weakened after an oil price fall and he became increasingly frustrated at Thatcher’s rejection of the ERM, which he believed would have given more credibility to the government’s anti-inflationary policies.

He decided to peg sterling at 3 Deutschmarks from March 1987, without directly advising the prime minister or her special adviser Sir Alan Walters, with whom Lawson became increasingly at odds. Interest rates were then too low to maintain monetary stability, especially when interest rates were cut further after the 1987 stock market crash to avert a feared, but illusory, slump.

The housing market boomed and inflation accelerated again. Lawson later blamed official statistics for initially concealing the scale of the boom, but Thatcher argued that the policy of shadowing the D-Mark had created the later inflation.

Nigel Lawson became a controversial figure later in life,
Nigel Lawson became a controversial figure later in life, sceptical of climate change and becoming a Eurosceptic © PA

Lawson’s monumental memoirs, running to well over 1,000 pages and published in 1992, set out in great detail the internal divisions in the government over Europe at this period. His relationship with Thatcher became increasingly strained, not least because of his vigorous private stand against the poll tax.

He was forced to uncap sterling in March 1988, and the pound perversely rose for a time, throwing exchange rate and monetary policy into disarray in the midst of a credit-driven domestic economic boom. Lawson later admitted that the shortlived cut in base rates to 7.5 per cent in May 1988 “was subsequently to do considerable damage to my reputation”.

The breaking point came in October 1989. Inflation was rising, interest rates had reached 15 per cent on the eve of the Conservative conference, and the European issue had split the cabinet. The stated resignation issue was the continuing role of Walters in undermining Lawson’s strong sterling policy, but Europe had become a running sore.

Lawson’s resignation marked the end of his frontline political career. He stood down from parliament before the 1992 election, and accepted the title of Baron Lawson of Blaby.

He took up several company directorships, such as at Barclays. Substantial jobs eluded him, although he was mentioned as an outside candidate for governor of the Bank of England in 1993.

Lawson did, however, become a controversial figure later in life, chairing the Global Warming Policy Foundation, a lobby group sceptical of man-made climate change. “Extreme weather events have always happened,” he said in 2017. “They come and go.”

He also became a staunch advocate of Brexit, a case he sometimes advanced from his home in France. His embrace of Euroscepticism only burnished his reputation for those on the Tory right.

Lawson had six children, including Nigella Lawson, a food writer and television cook, and Dominic Lawson, a journalist.


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