Editing John Major (section)

=== Chancellor of the Exchequer (1989–1990) ===
After just three months as Foreign Secretary Major was appointed Chancellor of the Exchequer on 26 October 1989 following the sudden resignation of [[Nigel Lawson]], who had fallen out with Thatcher over what he saw as her excessive reliance on the advice of her Economic Adviser [[Alan Walters]].{{sfn|Major|2000|p=130}}{{sfn|Seldon|1998|pp=100-101}}<ref name=19891027guardian>{{cite news|last=Travis |first=Alan |url=https://www.theguardian.com/politics/1989/oct/27/past.christopherhuhne |title=Lawson sparks reshuffle |work=The Guardian |date= 27 October 1989|access-date=18 October 2009 |location=London}}</ref>{{refn|group=nb|Walters resigned soon after.<ref>{{cite web |title=Obituary – Sir Alan Walters |url=https://www.theguardian.com/politics/2009/jan/06/sir-alan-walters-obituary |work=The Guardian|date=6 January 2009|access-date=25 April 2020}}</ref>}} The appointment meant that, despite only being in the Cabinet for a little over two years, Major had gone from the most junior position in the Cabinet to holding two of the [[Great Offices of State]]. Major made tackling inflation a priority, stating that tough measures were needed to bring it down and that "if it isn't hurting, it isn't working."{{sfn|Seldon|1998|p=101}}{{sfn|Turner|2013|p=22}} He delivered his first [[Autumn Statement]] on 15 November, announcing a boost in spending (mainly for the NHS) and with interest rates to be kept as they were.{{sfn|Major|2000|pp=140-141}}{{sfn|Seldon|1998|p=104}}

As Chancellor, Major presented only [[1990 United Kingdom budget|one Budget]], the first to be televised live, on 20 March 1990.{{sfn|Seldon|1998|p=106}} He publicised it as a 'budget for savers', with the creations of the [[tax-exempt special savings account]] (TESSA), arguing that measures were required to address the marked fall in the household [[savings ratio]] that had been apparent during the previous [[financial year]]. Major also abolished the composite rate tax and [[stamp duty]] on share trades, whilst increasing taxes on alcohol, cigarettes and petrol.{{sfn|Major|2000|p=146}}{{sfn|Seldon|1998|pp=105-106}} Tax cuts were also made which benefited football associations, the aim being to increase funding on safety measures following the [[Bradford City stadium fire]] and [[Hillsborough disaster]].{{sfn|Major|2000|pp=146-147}}{{sfn|Seldon|1998|p=106}} Extra funding was also made available to Scotland in order to limit the impact of the [[Community Charge]] (widely dubbed the 'Poll Tax'), which had been introduced there that year.{{sfn|Major|2000|p=148}}{{sfn|Seldon|1998|p=106}}

The European Community's push for full [[Economic and Monetary Union of the European Union|Economic and Monetary Union]] (EMU) was another important factor in Major's time as Chancellor; in June 1990 he proposed that instead of a single European currency there could instead be a 'hard [[European Currency Unit|ECU]]',{{refn|group=nb|The European Currency Unit was a notional unit of account based on a weighted 'basket' of major European currencies. It was replaced with the physical Euro currency in 1999.<ref>{{cite web |title=A Brief History of the ECU, the Predecessor of the Euro |url=http://fx.sauder.ubc.ca/ECU.html |publisher=UBC Sauder School of Business|access-date=25 April 2020}}</ref>}} which different national currencies could compete against and, if the ECU was successful, could lead to a single currency.{{sfn|Major|2000|pp=150-151}}{{sfn|Seldon|1998|pp=107-108}} The move was seen as a wrecking tactic by France and Germany, especially when the increasingly [[Euroscepticism in the United Kingdom|Euro-sceptic]] Thatcher announced her outright opposition to EMU, and the idea was abandoned.{{sfn|Major|2000|p=152}} More successfully, Major managed to get the new [[European Bank for Reconstruction and Development]] (EBRD) located in London.{{sfn|Major|2000|p=149}}{{sfn|Seldon|1998|p=107}}

By early 1990, Major had become convinced that the best way to combat inflation and restore macroeconomic stability would be if the British pound were to join the [[European Exchange Rate Mechanism]] (ERM), and he and [[Douglas Hurd]] (Major's successor as Foreign Secretary) set about trying to convince a reluctant Thatcher to join it.{{sfn|Major|2000|p=155}}{{sfn|Seldon|1998|pp=110-112}}<ref>Edmund Dell, ''The Chancellors: A History of the Chancellors of the Exchequer, 1945–90'' (Harper Collins, 1997), pp. 541–50.</ref> The move was supported by the [[Bank of England]], the Treasury, most of the Cabinet, the Labour Party, several major business associations and much of the press.{{sfn|Seldon|1998|p=111}}{{sfn|Turner|2013|p=84}} With the '[[Lawson Boom]]' showing signs of running out of steam, exacerbated by rising oil prices following Iraq's [[invasion of Kuwait]] in August 1990, there were fears of a potential recession and pressure to cut interest rates.{{sfn|Major|2000|pp=159-160}}{{sfn|Seldon|1998|p=113}} Thatcher finally agreed on 4 October, and Britain's entry into the ERM at a rate of [[Deutsche Mark|DM]] 2.95 to £1.00 (with an agreed 6% floating 'band' either side) was announced the following day.{{sfn|Major|2000|p=163}}{{sfn|Seldon|1998|pp=113-114}} An interest rate cut of 1% (from 15%) was also announced on the same day.{{sfn|Major|2000|p=164}}{{sfn|Seldon|1998|p=113}}

The rest of Major's Chancellorship prior to the leadership contest was largely uneventful; he considered granting the Bank of England operational independence over monetary policy, with the ability to set interest rates, but decided against it.{{sfn|Major|2000|p=154}}{{refn|group=nb|This was later enacted under Labour Chancellor [[Gordon Brown]] in 1998.<ref>{{cite web |title=Chancellor announces new framework for monetary policy |url=http://archive.treasury.gov.uk/press/1997/p40_97.html |publisher=HM Treasury |date=6 May 1997 |access-date=27 February 2009 |archive-url=https://web.archive.org/web/20110720163816/http://archive.treasury.gov.uk/press/1997/p40_97.html |archive-date=20 July 2011 |url-status=dead}}</ref>}} He also agreed a restructuring and write-off of some [[Third World debt]] at a Commonwealth Finance Ministers meeting in [[Trinidad and Tobago]] in September 1990.{{sfn|Major|2000|p=165}}

====Conservative Party leadership contest====
{{Main|1990 Conservative Party leadership election}}

Opposition within the Conservative Party to Margaret Thatcher had been brewing for some time, focusing on what was seen as her brusque, imperious style and the [[Poll tax (Great Britain)|poll tax]], which was facing serious opposition across the country. In December 1989, she had survived a [[1989 Conservative Party leadership election|leadership bid]] by [[Sir Anthony Meyer, 3rd Baronet|Anthony Meyer]]; though she won easily, 60 MPs had not voted for her, and it was rumoured that many more had had to be strong-armed into supporting her.<ref>{{cite web |url=http://www.newstatesman.com/uk-politics/2009/02/father-thatcher-european |title=The stalking horse |last=Meyer |first=Ashley |date=26 February 2009 |work=New Statesman |access-date=8 January 2013}}</ref><ref name="GH6Dec1989">{{cite news |last1=Parkhouse |first1=Geoffrey |title=Bruising Win for Thatcher |url=https://news.google.com/newspapers?nid=GGgVawPscysC&dat=19891206&printsec=frontpage&hl=en |access-date=22 December 2019 |work=The Glasgow Herald |date=6 December 1989 |page=1}}</ref><ref name="89election">{{cite news|url=http://news.bbc.co.uk/onthisday/hi/dates/stories/december/5/newsid_2528000/2528339.stm|access-date=1 November 2008|title=5 December 1989: Thatcher beats off leadership rival|work=On This Day 1950–2005}}</ref> By early 1990, it was clear that bills for many under the new poll tax regime would be higher than anticipated, and opposition to the Tax grew, with a non-payment campaign gaining much support and an anti-poll tax demonstration in [[Trafalgar Square]] in March ending in [[Poll tax riots|rioting]].<ref name="Revealed">{{citation|title=Revealed: How police panic played into the hand of the poll tax rioters|last=Verkaik|first=Robert|url=https://www.independent.co.uk/news/uk/crime/revealed-how-police-panic-played-into-the-hands-of-the-poll-tax-rioters-523918.html|archive-url=https://web.archive.org/web/20121110230921/http://www.independent.co.uk/news/uk/crime/revealed-how-police-panic-played-into-the-hands-of-the-poll-tax-rioters-523918.html|url-status=dead|archive-date=10 November 2012|date=21 January 2006|work=The Independent|page=10|access-date=17 May 2008}}</ref> The Conservatives lost the [[1990 Mid Staffordshire by-election]] to Labour and the [[1990 Eastbourne by-election]] to the [[Liberal Democrats (UK)|Liberal Democrats]], both Conservative seats, causing many Conservative MPs to worry about their prospects at the upcoming general election, due in 1991 or 1992.<ref name="Times 92">{{cite book|title=The Times Guide to the House of Commons April 1992|date=1992|publisher=Times Book|location=London|isbn=0-7230-0497-8|page=286}}</ref><ref>{{cite book |last1=Seldon |first1=Anthony |author2=Daniel Collings |title=Britain under Thatcher |date=2014 |publisher=Routledge |page=60}}</ref>{{sfn|Major|2000|p=173}} Thatcher's staunch anti-European stance also alienated pro-Europe Conservatives.{{sfn|Major|2000|pp=175-176}}{{sfn|Seldon|1998|p=113}} On 1 November, the pro-European deputy prime minister [[Geoffrey Howe]] resigned, issuing a fiercely critical broadside against Thatcher in the House of Commons on 13 November.<ref name="Observer">{{cite news |first=Andrew |last=Rawnsley |url=https://www.theguardian.com/politics/2015/oct/10/geoffrey-how-the-cabinet-ally-who-became-thatchers-assassin |title=Geoffrey Howe, the close cabinet ally who became Thatcher's assassin |work=The Observer |date=10 October 2015 |access-date=11 March 2019}}</ref>{{sfn|Major|2000|p=179}}{{sfn|Seldon|1998|p=120}}

The day after Howe's speech [[Michael Heseltine]], Thatcher's former [[Secretary of State for Defence]] who had acrimoniously resigned in 1986 over the [[Westland affair]], challenged Thatcher for the leadership of the Conservative Party.{{sfn|Major|2000|p=181}}{{sfn|Seldon|1998|p=120}} Both John Major and Foreign Secretary [[Douglas Hurd]] supported Thatcher in the first round. Major was at home in Huntingdon recovering from a pre-arranged wisdom tooth operation during the first leadership ballot, which Thatcher won but not by the required threshold, necessitating a second round.{{sfn|Major|2000|pp=182-185}}{{sfn|Seldon|1998|pp=121-122}} Following discussions with her cabinet, in which many stated that though supporting her they doubted she could win, Thatcher withdrew from the contest and announced that she would resign as prime minister once a new leader had been elected.<ref>{{cite news|url=http://news.bbc.co.uk/onthisday/hi/dates/stories/november/22/newsid_2549000/2549189.stm|work=BBC News|title=1990: Thatcher quits as prime minister|date=22 November 1990}}</ref> Major subsequently announced on 22 November that he would stand in the second ballot, with Thatcher's backing.{{sfn|Major|2000|p=187}}{{sfn|Seldon|1998|p=123}} Major's platform was one of moderation on Europe, a review of the poll tax, and the desire to build a "classless society".{{sfn|Major|2000|pp=191-193}}{{sfn|Seldon|1998|pp=125-126}}

Unlike in the first ballot, a candidate only required a simple majority of Conservative MPs to win, in this case 187 of 372 MPs. The ballot was held on the afternoon of 27 November; although Major obtained 185 votes, 2 votes short of an overall majority, he polled far enough ahead of both Hurd and Heseltine to secure their immediate withdrawal.{{sfn|Major|2000|pp=198-199}}{{sfn|Seldon|1998|p=127}} With no remaining challengers, Major was formally named Leader of the Conservative Party that evening and was duly appointed prime minister the following day.{{sfn|Major|2000|pp=200-201}}{{sfn|Seldon|1998|p=128}}<ref>{{cite news|url=http://news.bbc.co.uk/onthisday/hi/dates/stories/november/27/newsid_2528000/2528847.stm|work=BBC News|title=1990: Tories choose Major for Number 10|date=27 November 1990}}</ref> At 47, he was the youngest prime minister since [[Lord Rosebery]] some 95 years earlier.{{sfn|Seldon|1998|p=131}}