For the Record

But after the shoo-ins there were some surprises.

Theresa May stepped into the Cabinet Room and sat opposite me across the green table. She had huge experience in shadowing government departments, having covered the Education, Transport, Culture and Families portfolios over the years, as well as being the Conservatives’ first female chairman. Most recently I had appointed her to shadow Work and Pensions – and I am sure that’s what she expected to be offered.

‘I want you to be home secretary,’ I said to her. Theresa is not always the most expressive person, but she looked genuinely surprised and delighted. This may have been one of the least expected appointments – but it would turn out to be one of the best.

Another surprise was my choice for Work and Pensions. George – ironically, given their later battles – persuaded me that right-winger Iain Duncan Smith would provide balance in our cabinet.

Then there was the choice of party chairman. I wanted someone who was a loyalist and who would continue the work of delivering a modern, compassionate Conservative Party that reflected and represented all of Britain.

Sayeeda Warsi had joined the party as an adviser to Michael Howard after setting up a legal practice in her native West Yorkshire. She had been by my side through my leadership (halfway through I’d appointed her to the Lords), speaking with a no-nonsense conviction on issues domestic and foreign that I found refreshing and impressive. I told her I wanted her to be joint chairman with Andrew Feldman, who I hoped would continue his great work. She couldn’t believe it. The daughter of a textile worker from Pakistan had taken her place in a Conservative British cabinet, the first Muslim woman to do so. The partnership was a statement about how far we had come, in that we had a Muslim and a Jew jointly chairing our party.

The cabinet jobs lost to Lib Dems would upset some, but there were fortunate solutions for most of them. Ken Clarke, for example, had been shadowing Business, but Justice was a good alternative, given his legal background. Francis Maude and Oliver Letwin were happy – and extremely effective – in the Cabinet Office, which would become an engine room for both delivering savings in government spending and making the coalition work.

Of course there were some people who were disappointed. Chris Grayling and Theresa Villiers had been in the shadow cabinet. Neither made it into the cabinet at the start of the government, but both took their lesser appointments with good grace and worked to prove themselves in their new roles. Theresa later made an excellent Northern Ireland secretary, and Chris served as lord chancellor.

But there were those who were more openly upset that their shadow portfolios were taken by Liberal Democrats. There were some awkward conversations, and in one or two cases it created simmering resentments. I understood how frustrated some colleagues were. Some had shadowed a government department for years on end, asking questions in Parliament and building up their expertise, only to have their dreams of office snatched away by the arrival of an unexpected coalition.

Appointing 118 ministers across just two days, there are bound to be some slip-ups – and I made a couple of errors.

The number of full cabinet members is strictly limited – to twenty-three – and, as other PMs have done before me, I tried to make the numbers add up by having some ministers ‘attending cabinet’ but not paid the full salary. Foolishly, I included Tom Strathclyde, leader of the House of Lords, in this category.

Tom explained – rather forcefully – that it wasn’t about the money, it was that their lordships simply wouldn’t stand for their champion in cabinet having ‘lesser status’. He was right. The problem was that when he told me this I had already filled all the other posts.

Most secretaries of state have to be in the cabinet, so the only solution was to pick on the most agreeable Member of Parliament that I had already appointed and ask them to accept a downgrade. There was one outstanding candidate for this honour: my leader of the House of Commons, Sir George Young, a veteran of the Thatcher and Major governments and known as ‘Gentleman George’. He lived up to his name, and couldn’t have been nicer about the whole thing, pay cut included. All too often in politics the stubborn get rewarded and the good guys get shafted. On the other hand, George’s grace is among the reasons he has had one of the longest, most extraordinary ministerial careers of modern times.

We agreed that the Lib Dems would have five cabinet positions and a number of ministers that corresponded to their proportion of MPs. And that led to the question of what job Nick Clegg should do. I was keen that he consider holding a major office of state, such as the Home Office or Environment. But he wanted instead to be deputy prime minister.

I didn’t feel strongly about it. My priority was making the government stable at a time of such uncertainty, and I was perfectly happy with any solution that did that.

As for his choice of ministers, I insisted on formally appointing each of them as I did those from my own party. Again, I wanted to emphasise that this was one team under one prime minister.

Some of the Lib Dems on the left were sceptical but willing to make it work, like Vince Cable. Others towards the right of the party were enthusiastic, like David Laws. Another even said to me: ‘You don’t have to worry about me, I’m basically a Tory anyway.’

A few were quite emotional, even tearful, like Tom McNally. He had been elected a Labour MP in 1979, having previously worked in Jim Callaghan’s No. 10. Now a Liberal Democrat, he was the party’s leader in the Lords in a Conservative-led government. Although a left-leaning Liberal, he was determined to make it work, and did a great deal to ensure it did.

To begin with George and I were highly sceptical about whether the Lib Dems should get two big economic portfolios: chief secretary to the Treasury and business secretary. But in the end we agreed that it would be helpful to make sure there was a Lib Dem in the Treasury, and seen to be as responsible for the cuts programme as we were.

With a ministerial team in place and the mechanics whirring away, it was time to answer the most important question: why. Why was I in government, taking this approach, joining forces with a rival party? This was the most straightforward question of all to answer: we were engaged in a full-scale economic recovery job, to turn around the British economy and deal with what had become one of the largest budget deficits in the world, forecast to be over 11 per cent of our GDP.

And we were going to do it in a way that was true to the modern, compassionate Conservative message we had developed.

On our first full day, the stage was set to deliver the message. The chairs were laid out in rows on the Downing Street lawn, with an aisle down the middle. Cameras clicked, there was an expectant air, as Nick and I emerged from the Cabinet Room to stand before the gathered crowd.

The marriage metaphors used to describe the ‘Rose Garden’ press conference weren’t that far-fetched. It did look and feel a bit like a wedding. And, like a groom, I was nervous, aware of the immensity of the occasion and the need to rise to it. ‘We mustn’t come up short here,’ I said to Clegg in the Cabinet Room before we stepped outside. ‘It is one of those times when we need to give it 20 per cent more than feels appropriate.’ And that’s what we both did.

‘Today we are not just announcing a new government and new ministers,’ I said. ‘We are announcing a new politics. A new politics where the national interest is more important than party interest. Where cooperation wins out over confrontation. Where compromise, give and take, reasonable, civilised, grown-up behaviour is not a sign of weakness but of strength.’

The tone was meant to be historic, but on rereading it feels a little histrionic. These were unprecedented times, however, and I was trying to rise to them.

One consequence was that those who were disappointed that we hadn’t achieved a majority felt we were rubbing their noses in it. And that I was enjoying myself with the Lib Dems a bit too much.

But while I understand this criticism, overall I don’t regret the Rose Garden performance. The banter and bonhomie did help to set the tone for what we were about to embark on. They showed that Nick and I were confident we could work together and were clear about our task: to confront the economic challenge ahead of us.

Britain – this proud, prudent, economic powerhouse – was in deep economic trouble, and it needed a government that people had confidence in. One that would persist and could weather political storms, one that would give creditors confidence in the country they were being asked to lend to. Forming such a government was part of our solution to the problem.

The urgency of our task had been underlined on our first full day in office, when news emerged that unemployment had hit its highest level since 1994. We started work straight away on the £6 billion of in-year cuts that we had promised and that our coalition partners had now agreed to.

As politicians, we took the lead ourselves, cutting ministers’ pay by 5 per cent and freezing it for five years. We also scrapped ministers’ personal drivers.

We agreed on the importance of cutting taxes for the lowest-paid. So another early action was raising the threshold at which people started paying tax to nearly £7,500 – meaning that nearly a million more would no longer pay any income tax at all.

All this was underpinned by the ‘Coalition Agreement’ and the ‘Coalition Programme for Government’, both hastily compiled but surprisingly comprehensive combinations of our two manifestos, which became our blueprint for government. They stood the test of time.

I didn’t feel we were being constrained by the burdens of office or the addition of the Lib Dems. On the contrary. I felt liberated by office. We were finally doing the things we wanted to do, not just talking about them.

While economic policy would prove the central challenge, it naturally wasn’t the only one. Although I didn’t appreciate at this point quite how much of my time as prime minister would be consumed by foreign and security issues, I was persuaded that we should prepare properly for the work that would need to be done.

One of the big changes to the machinery of government was the inauguration of a National Security Council, which came out of our policy review, chaired by Pauline Neville-Jones, in opposition. The rationale was simple. It no longer made sense to consider foreign policy on its own. The challenges we faced required a response from across government, not just the Foreign Office. Particularly with the rise of threats from what the experts like to call ‘non-state actors’ – basically terrorists – we needed to combine diplomatic, military and counter-extremist thinking.

Afghanistan was the classic example. We could only make progress if we could deal with the poor relations between Afghanistan and Pakistan (Foreign Office), assist in the fight against the Taliban (Ministry of Defence), deal with the flow of drugs from the region (Home Office), improve the country’s potential for economic development (Department for International Development), while all the time working on the vital issue of countering Islamist extremism (Home Office again).

The National Security Council brought all of these departments together, combined with our intelligence services, MI5, SIS and GCHQ, and the armed forces, as represented by the chief of the defence staff. I appointed Peter Ricketts, who was the permanent secretary at the Foreign Office, as the first national security adviser. Coming straight from the FCO, he secured that department’s cooperation with the new arrangements and carried out his new role with huge ability. The NSC is now a vital part of the UK government – and I believe will remain so.

Of course, there was another early national security question to be settled – this one by me alone.

Every PM must decide what set of instructions to send to the commanders of the Trident submarines for use in the event of a nuclear attack on the UK that has rendered other means of communication redundant. These are the so-called ‘letters of last resort’. A senior naval commander comes to your office to brief you on the options and the process. You’re then left alone with a series of alternative letters, and you decide which instructions to give. The others you shred in a giant, industrial-sized shredder which seems to appear in your office that morning.

It is the moment when the full seriousness of your responsibilities as prime minister come home to you. I had spoken with John Major about the approach he had taken, and I had decided on what I believed to be the right course of action. But even so, I sat and stared at the cold words on the page, trying to imagine the scenario in which one of our sub­marine commanders had to open one of my letters.

As I handed over the chosen letters to the officer – letters I prayed would never, ever, have to be opened – one of the envelope’s seals popped open. A call for Pritt Stick and Sellotape was rapidly answered. An absurd moment in such a solemn process.

So what were my perceptions of office as the sun shone on us in those early days?

All in all, I felt we were successfully setting the scene for a long-lasting coalition, and for turning around our economic fortunes.

By the end of the first month Sam and I decided we and the children would move into Downing Street rather than staying in west London, and we brought across the entire contents of our home – bikes, beds, beanbags and, after a few months, our new baby daughter.

When we departed six years later, we left some of the furniture behind. This included an IKEA kitchen cabinet which I had assembled in the days just after Florence had been born. Nick Clegg had needed to see me, and found me in the kitchen surrounded by pages of instructions, wooden panels, nuts, bolts and screws. He immediately helped out, and we joked as we assembled the ‘coalition cabinet’. Samantha commended us on our work, but pointed out that the two doors did not quite align with each other.

For me, living in Downing Street was perfect. Whether I was upstairs in the flat or downstairs in the office, I was never far from my two enormous responsibilities, to my family and to the country.

13

Special Relationships

Within minutes of arriving at the Renaissance palace in Rome that was Silvio Berlusconi’s official residence, I was in his bedroom. The Italian prime minister was showing me an ancient two-way mirror. ‘They didn’t have porn channels in the fifteenth century,’ he explained.

During your first few weeks and months as prime minister, you must begin forging the relationships that will help advance Britain’s interests around the world. Personal bonds are vital; relations between countries really can be enhanced by the rapport between their leaders or jeopardised by the lack of it.

In the digital age, the old ways of doing things – messages passed through ambassadors or fixed times for formal telephone calls – are being augmented with new methods. I had a pretty regular text relationship with the Dutch and Swedish prime ministers and the crown prince of UAE, for instance, and I also exchanged communications with the Australian and New Zealand prime ministers.

But the traditional methods, including phone calls, formal diplomatic visits and international summits, do still matter. I had spent years laying the groundwork for these relationships. However, the amount of time I had to devote to foreign affairs as PM still surprised me. We once did a calculation which showed that a third of my time was spent on trips overseas, foreign policy meetings, hosting foreign leaders and National Security Council meetings.

My approach to foreign policy began with what I suppose might be called a patriot’s view of British history: not one that ignored its flaws, but nevertheless one that felt great pride in our role and contribution. I didn’t accept the idea that Britain was facing inevitable relative decline. Previous predictions of our demise in the 1960s and 70s had been defied by the economic success of the Thatcher years, with their global exports of privatisation, shareholder capitalism and the rule of law.

It saddened me to see some commentators talk about an inexorable waning of our influence. I understood that with the rise of India and China power was moving south and east, but I didn’t accept that Britain couldn’t forge its own important role in the world.

We still had some great advantages: our time zone placing us between Asia and the Americas, English as the global language, our universities and science base, expertise in aid and diplomacy, widely respected armed forces and an unequalled network of global alliances, including NATO, the EU, the Commonwealth, the G8, G20, IMF, and permanent membership of the UN Security Council.

The Labour governments had had some foreign policy successes. There had been the actions to save Sierra Leone and Kosovo, and Gordon Brown had used the G20 effectively to help coordinate action after the global economic crisis. But at the same time their foreign policy had been disproportionately defined by two relationships: with the US and the EU. Elsewhere, they had closed embassies and downgraded the importance of the Foreign and Commonwealth Office. Far too many old alliances had been allowed to slide.

It was clear to me that, alongside our economic rescue, reasserting Britain’s global status would be one of our biggest missions in government. In fact, the two were intertwined. Building a stronger economy relied upon the goods and services we sold abroad and the investment we attracted at home. And our global reputation rested upon our ability to fix our economy.

I approached our foreign policy challenges as a ‘liberal conservative’, not a ‘neo-conservative’. While I understood and sympathised with the doctrine of Bush and Blair – that spreading democracy around the world helped peace and prosperity – I felt that their rhetoric and actions didn’t reflect the difficulties of achieving such change. I wanted a foreign policy that was practical, hard-headed and realistic.

My practical approach made me sceptical of the view of some in Whitehall that the job of the politicians was simply to set the overall strategy and leave its implementation to officials. Some of the military top brass were particularly keen on this, and thoroughly disliked it when I interfered in deployments of ships, troops or submarines. But you cannot always separate tactics and strategy: the politicians need to be intricately involved in both.

The hard-headedness came from my belief that we should never be ashamed of using foreign policy to help generate prosperity at home. For too long, the FCO had neglected its economic responsibilities. India was one of the world’s fastest-growing economies, yet we had fallen from their fourth biggest source of imports to their eighteenth in just one decade. We still exported more to Ireland than to the BRICS economies of Brazil, Russia, India, China and South Africa.

I saw an opportunity to reposition our diplomatic network as a generator of trade and inward investment. Some sneered at ‘commercial diplomacy’; I made it a key plank of my foreign policy. We had a presence in 196 countries across the world. That was 196 potential shop windows in which to advertise Britain.

The realism was evident in our recognition that democracy wouldn’t take root at the drop of a hat – or bomb. Its components – the rule of law, a fair judiciary, property rights, a free press – take time to embed. This was not a disavowal of military action. Instead, I saw it as a course correction from the excessive interventionism of the New Labour years.

I admired Tony Blair’s passion for trying to solve problems and to intervene in difficult situations. But his foreign-policy actions lacked the consideration of a good driver – too keen to keep his foot on the accelerator and insufficient in his use of either brakes or rear-view mirror. At the same time, what I didn’t want was for the pendulum to swing too far in the other direction and rule out intervention altogether. There are occasions when you have to intervene. The failure to intervene in Bosnia and Rwanda in the 1990s influenced the rush to intervene in Iraq. I didn’t want Iraq to stop us intervening somewhere that it was desperately needed in the future. Every case and conflict is different.

When it came to the ‘special relationship’ with the USA, I had always felt it was special to me personally: I had huge admiration for the United States, loved spending time there, and as a child of the Cold War I was clear that it was our best friend and ally. It seemed obvious that we should want to maintain, and where possible enhance, the special relationship. And I believe that word – ‘special’ – is merited. In my view, the intensity of the partnership between our intelligence services justifies the title on its own, quite aside from the powerful ties of history, language, culture, trade and values.

But it shouldn’t be our only special relationship. I wanted to carve out privileged partnerships with global giants like China and India, and to restore bonds which I felt had been weakened with Australia, Canada, New Zealand (no recent Labour foreign secretary had been to Australia, for example) and our other Commonwealth allies, like Malaysia and Singapore.

In the Gulf there was a whole series of countries that saw Britain as their oldest ally and friend – we needed to show that meant something to us too. Then there were the South American countries, many of which had long-standing historical relationships with Britain, such as Chile and Colombia, which were on the rise again, but with which Britain was not engaging properly.

The relationship-building with foreign leaders starts with the phone calls. The call with President Obama was followed by calls from all the foreign leaders over the next few days. Such conversations are useful, but it is the one-on-ones you have in which relationships are really cemented. I look back on those meetings now, and on what I was trying to achieve, and I can see them falling into four categories.

There are the agendas you began and which yielded real and lasting results. There are those you started but which got nowhere. There are those you wish you had pushed harder. And there are some you wish you had never started at all.

My first visit – and it is important which country you pick first – would be to France. With the Entente Cordiale and the fact that I knew Nicolas Sarkozy, it made sense.

There was one man who would prove essential to all this: my foreign affairs private secretary, Tom Fletcher. Tom had worked for Gordon Brown, and became my support, sounding board and source of information about virtually every country on Earth. He correctly warned me before this first trip that Sarko would be my ‘best friend and biggest rival’.

Sarkozy made great statements publicly and privately about our friendship and how well we would work together. Knowing my love of tennis, he presented me with two state-of-the-art Babolat racquets, one yellow, one blue, reflecting the coalition colours.

The truth of our relationship was slightly different. Although we were both conservative politicians, and similar in many ways, even at this early meeting I could see how divergent some of our ideas were. His criticisms of the European Union tended to be that it wasn’t doing enough, whereas in most areas I thought it was doing too much. He had the traditional Gallic and Gaullist distrust of finance and a suspicion of the City of London. I wanted a more balanced economy, for sure, but was totally opposed to harming what was a vital British asset, or sanctioning even more European action in this area.