Spies at Work, Chapter 9: Spies at Work

Back to Chapter Index

Introduction

Wilson's relationship with the secret services, particularly F Branch of MI5 which was responsible for surveillance of the British left and trade unions, began badly and ended dreadfully. But there was a period during 1966 when he seemed to be working closely with them, much to the surprise and disgust of many in the Party, even some of his more right-wing colleagues. Immediately after the election victory of 1966 Wilson attempted to introduce a prices and incomes policy, pegging price rises and wage increases to around 3.5%. The unions' lack of enthusiasm for the idea meant that sooner rather than later there would be some sort of confrontation with a major trade union. In early 1966 it emerged that union would be the National Union of Seamen (NUS). The NUS was a strategically important union but not traditionally militant, and had not organised a major strike since 1911. However when, despite the 3.5% "pay norm", they sought a 17% rise and the shipowners indicated that they were willing to pay it, Wilson intervened to prevent the prices and incomes policy collapsing. The Seamen's Strike began in May 1966 and posed an immediate threat not only to the government's pay policy but to the British economy. Wilson handled the strike badly, and lost the trust and faith of many rank and file trade unionists without gaining anything in return - from the right in industry, the press, the intelligence community or those in the Labour Party who had egged him on. It was the major turning point in Wilson's career, and it created enduring problems that he never effectively resolved. One of the most extraordinary features of his handling of the strike were his statements to the House of Commons in which he alleged the strike was being manipulated by:

". . . a tightly knit group of politically motivated men who, as the last General Election showed, utterly failed to secure acceptance of their views by the British electorate . . . Some of them are now saying very blatantly that they are more concerned with harming the nation than with getting the justice we all want to see."

The following Sunday the Observer published an article, under the headline "The Men Behind The Plot" which named five Communist Party members said to be orchestrating the seamen's strike for their own political ends. In a debate in Parliament the following Wednesday Wilson provided more details of the alleged conspiracy. The two sources for the Observer article were the Economic League, named by the paper, and George Wigg, the Paymaster General whose confused portfolio of responsibilities included both acting as a link between Wilson and MI5, and being the major conduit of officially sanctioned "leaks" to the press. In an unsuccessful attempt to get Tory backing for his red scare tactics Wilson arranged for Ted Heath to be briefed by the director of F Branch, Dick Thistlethwaite, and the F Branch officer in charge of the bugging of NUS headquarters. But rather than backing off after this, Heath increased the pressure on Wilson in the House of Commons by demanding even more information about the plot. The Economic League's part in this affair would however seem to have been as important as that of MI5. They were so pleased with their role that they celebrated it in an article in one of their monthly newsletters:

The Economic League at Work on Panorama

Countering subversive activities in industry

"On the eve of the Prime Ministers statement about the influence of a "tightly-knit group of politically motivated men" on the progress of the seamen's strike in June 1966, the Economic League was invited by the BBC to provide factual background to a Panorama programme dealing with the subject.

"The League's contribution, which was undertaken by the Publicity Director, Mr H R Welton, occupied the opening ten minutes of the programme and was used as the foundation to material brought out in ensuing interviews and news reports."

Later on the article recalls some interesting features cut from the interview with Welton:

"The interview actually recorded covered approximately fifteen minutes and it was inevitable and understood that this would be cut and edited. This editing was carried out quite fairly and the programme as transmitted very well represented the interview as a whole. "Nevertheless in such editing many points of some importance are bound to be lost. For instance, in the early stages of the recording the Publicity Director dealt fully with the operations of Bert Ramelson, the Head of the Communist Party's Industrial Department . . . One of the most interesting points dealt with by the Publicity Director, but omitted from the transmitted programme, was that appeals for funds for the strike were being made on a national basis but were to be sent to the Victoria and Albert Branch of the NUS which was dominated by two Communists, Gordon Norris and Jack Coward."

The point that the Economic League was trying to make here was that before Wilson's statements to the Commons, the League had given three of the names of the "tightly-knit group of politically motivated men" to Panorama. During the making of the programme researchers had warned John Prescott, now one of the Labour Party's leading front benchers but then a National Union of Seamen activist studying at Hull University, that Wilson was about to name him too. ^[1]

Wilson's statements in Parliament did not therefore come out of the blue, but merely reinforced a message that the Economic League had already publicised both through the Observer and one of the most popular programmes on television. In assessing the League's role in this affair the two key questions are: Were MI5 and the League working together, and would MI5 have been able, via Wigg, to persuade Wilson to make the claims about communist manipulation of the strike without the League's intervention? Unfortunately it is simply not possible to answer either conclusively, it is however possible to say that the balance of probability lies in favour of collusion between MI5 and the League. There were historical connections, the League was a free source of useful intelligence that would have been valuable to MI5 and at the same time it was an eminently deniable vehicle for any smears that it wanted to generate about the strike.

In respect of the League's impact on Wilson's decision to allege that the strike was politically motivated it is only possible to say that the prior publicity must have encouraged him. And without at least one quotable source, in the form of the League, to make the allegations then it is unlikely either the Panorama programme would have been made, or that the allegations would have merited a major article in the Observer. This however was not the Economic League's only successful and well publicised intervention in the Seamen's strike. On the 21st June Helen Bailey, a glamorous Economic League speaker, had attracted a great deal of newspaper coverage by preventing the docker's leader Jack Dash from holding a meeting to canvass support for the seamen. The Daily Sketch, Daily Mail, Daily Express, Scotsman, and Evening News all carried the story of how she had turned up before Dash and held her own meeting, in which, according to the Evening News, she:

". . . spoke for about 45 minutes to 300 dockers on Communists in British Industry. She said: 'There is evidence in the seamen's union that there have been extremists who have tried to take the union over. Communists try by subversion to undermine the country. By finding out where their members work and what union they belong to then they [sic, I suspect this should read 'we'] know precisely where their troops are deployed.'" ^[2]

The Daily Express ran a chatty feature on Helen Bailey by Mary Kenny, titled "Little Nell - she silenced the dockers":

"Wearing a figure-hugging print dress and bright red shoes, Helen Bailey went on: 'I feel I achieve more by being feminine. I like to be provocative.' A serious minded girl, Helen Bailey has been talking at meetings in the docks for the last 15 years. 'This is because I hate communism.'"

Elsewhere in Kenny's article we learn that Helen Bailey lives in a basement flat near Marble Arch, "drives a green mini and carries her own little wooden platform with her," always takes her black poodle Susie to meetings, and "has just one golden rule - and makes no secret of it - 'I never speak to a communist.'"

The following day The Daily Mail ran a feature "Presenting the men of industry behind The girl who dished Jack Dash." Helen Bailey was, Charles Greville told readers, an Economics Graduate from Sheffield, and was one of fifty League lecturers out of a total staff of 100. Greville also interviewed Mr. John Dettmer, "a former Army officer who became director general in 1959." Dettmer told him:

"I shouldn't believe we were doing our job if extremists of any kind admired us."

But, he claimed, the League was non-political and its staff were forbidden to take part in election campaigns "so that they cannot be accused of taking sides." "What annoys the Left most, I fancy, is the League's habit of collecting minute details about political activists, and working them up into newsletters and briefings for member and speakers."

The League was getting all this additional press coverage for its allegations that the Seamens' strike was communist controlled while Wilson was trying to decide how much he should say about Communists in the NUS. Reviewing the affair now, the claim that the traditionally unmilitant seamen were being secretly manipulated by a handful of overt members of the Communist Party is to say the least unconvincing. Indeed insofar as there is any evidence of the machinations of "a tightly-knit group of politically motivated men," it would seem to point to those who were manipulating Harold Wilson, not the seamen.

Covert Operations

The League's claims to be politically independent and its professed support for "legitimate" trade unionism was of course disingenuous. It was clear that by this it meant trade unions who did not take industrial action, a perfectly legitimate trade union activity. But beyond this blatantly dishonest politicking it is hard to be scandalised by the League's overt propaganda work. Superficially at least it would seem to have been just another part of the rough and tumble of factory gate politics. But the distinction between its overt work and its secret activities was never entirely clear cut.

The press coverage for Harry Welton and Helen Bailey during June 1966 suggested an insidious collaboration with MI5. The Daily Mail's discussion of the way in which alleged subversives were named in League publications might seem to legitimise the maintenance of an employment blacklist, since the allegations being published meant they were at least in theory challengeable. But in fact there is a fundamental difference between a published blacklist of leading activists, and one that was operated in secrecy and could not be challenged by anyone. The secret blacklist was especially immune from a challenge by anyone who had no good reason to suspect that they might be blacklisted. In the "spytalk" glossary of Christopher Dobson and Ronald Payne's Dictionary of Espionage a "covert operation" is described as a "Concealed and deceptive activity". ^[3] But in espionage all actions are, at least intended to be, concealed and/or deceptive. A covert action by an intelligence agency is distinguished from its routine operations by the fact that intelligence (that is observation and the collection of information) is subordinate to intervention, and indeed a "covert" operation might well be a very public one in which the only "covert" feature is the fact of an intelligence agency's involvement.

Improvements in the quantity or quality of information are generally not the purpose of "covert action". The point of a covert operation is to change things and/or manipulate public opinion, without the intelligence agency ever having to admit involvement. Classic examples of covert action were MI6's scheme to assassinate Nasser at the time of the Suez crisis; the Information Research Department's establishment of its own apparently independent press agencies in the 1940s; the intelligence services repeated use of judicious leaks, generally to trusted journalists and authors, of secret information with a view to manipulating domestic public opinion.

There are two obvious senses in which the Economic League has been, for seventy years, involved in "covert action". Firstly its public, overt, activities have always been complemented by secret, fundamentally anti-democratic, activities and in at least some of these it had the support of MI5 or Special Branch. Secondly the League has always been a safe and unofficial means by which domestic intelligence can be obtained, and/or can be fed back to those can make use of it.

Blacklist

There is now no shortage of evidence about the Economic League's blacklist. In 1925 the League's 5th Annual Report records that under Sir Aukland Geddes there were lists and diagrams of the "interlocking directorates" of "socialist and subversive organisations." We also know from the Public Records Office that the League sought, and received, information from the Admiralty on at least one of the Invergordon Mutineers. The worker in question was subsequently dismissed from his job as a rigger. We also know that in 1937, when The Daily Worker obtained correspondence between John Baker White and Robert Rawdon Hoare that the League's had valuable, and illegal contacts with the police. These letters described the deal struck between Hoare and Detective Eckersley who ". . . promised to give me [Hoare] as long as I like looking over the Communist industrial file in their office . . . I am also in touch with the Salford Police; their Communist man having already called at this office." Another memo indicated that the police were going to supply a report of a private Communist Party meeting in Brighton to the League.

During the 1960's several newspapers ran stories about the League's blacklist. In 1961 the Daily Express ran a piece about the League in which readers were told that firms:

"can apply to the League's headquarters opposite Buckingham Palace to check if a prospective employee is listed as a Communist sympathiser." ^[4]

In January 1964 The Guardian exposed the Economic League:

"In a circular to its workers in its 10 regional offices the League says that when an approach is made to a potential industrial subscriber the firm should be told that much of its work is secret . . . the director must not be told straight away what the League does: this information is vouchsafed at personal interviews. 'If a director asks for details of our work, he should be told that some of it is highly confidential and therefore cannot be put in writing.'" ^[5]

The Observer obtained confirmation of the blacklist from a subscriber in 1969:

"One very large company which makes a very large donation says flatly that the League 'does a hell of a lot of vetting for us on political grounds, this is their sole use to us and for x pounds a year, it's good value for money.'" ^[6]

In 1970 Building Design explained that contractors could ring Major Newman of the Economic League ". . . and be told whether an prospective employee is a troublemaker." ^[7]

In April 1974 The Sunday Times investigated a story about workers at Strachan in Eastleigh, Hampshire, who occupied their factory which made van bodies for Fords. The parent company Giltspur Investments were trying to close the factory down. Strachan managers admitted to the newspaper that they had been using the Economic League to vet employees, that they had "a number of meetings with detectives to pass on details of what particular individuals had been doing" and that Special Branch had been watching the Strachan factory workers since the previous August. Time Out, the following month, reported that workers had rung the League's secret number (686-9841) and given the Strachan management's secret code (520). They asked for information on one of the shop stewards and were told - incorrectly - that he was a Communist Party member who had once stood for the Party in a local election. The Guardian followed the same procedure and identified the number as definitely belonging to the "Economic League". ^[8]

In October 1974 the Aberdeen People's Press reported that the League had opened an office in Aberdeen to service the oil companies. It was manned by a failed St. Andrews businessman called Brown.

In April 1977 The Guardian revealed that it was not only private industry that used the League's blacklist. When workers at the State-owned "Reinforcement Steel Services" occupied their Greenwich factory in 1977, they discovered that RSS were using the Economic League and that following alleged sabotage the Greenwich management had called in both Special Branch and the League. ^[9]

The following year The Guardian revealed that it was not only manufacturing companies who used the black list. Crematorium workers with the Great Southern Cemetery and Crematorium Group discovered a confidential memo:

"Before engaging staff in future, a call should be made to 01-681-7346, code number 555, and they will require the full names, the area of living, date of birth and National Insurance number of the proposed employee. You give him the code number, you do not give the company's name or mention it. If there is the slightest suggestion of any information held against the proposed employee from this source you do not engage same."

Again the Guardian followed this procedure checking out several names and the following day a number of corporate subscribers were reported as denying any knowledge of the blacklisting. However Peter Linklater, Shell's personnel director told the newspaper:

"They give us pretty good value . . . We are interested in identifying overt opponents of the system to which we are committed. The last thing we want to do is have political subversives on our payroll or on sites in which we have an interest."

The same edition the paper spoke to a former employee in the League's Glasgow office who explained that the Economic League also collected, and recommended against employment on the basis of, criminal records. ^[10]

Denials

Until 1969 the League denied all suggestions by journalists that it operated a blacklist. But in October of that year the League's "Publicly Director", Harry Welton, changed his tack and told the Observer:

"There's no secret about it. We say we're going to oppose subversion and by God we do. It frequently happens that trades unionists who feel as strongly as we do about the activities of subversives in their unions will give us information."

However, when the Guardian questioned the League in 1977 about its involvement with Reinforcement Steels in Greenwich, a spokesman replied: "We don't keep a blacklist. It's all a complete mystery."

After the discovery of the Southern Crematorium connection the following year the Guardian tried again. This time Jack Winder, the League's "Director of Information and Research" told the paper: "We don't keep files on anybody on behalf of anybody else." But when presented with the evidence he finally admitted:

"It is our business to have this information and we will give it to people."

Growing, adverse, publicity about the blacklist lead to a change in policy which Saxon Tate, the League chairman, explained in the 1978 Annual Report:

"The League puts considerable effort into monitoring the activities of subversive groups and individuals - those people who are known for certain to be actively striving to undermine not only free enterprise, but state controlled industry and public services too . . . The Central Council's policy has been to shun publicity . . . it has been decided that this policy should be changed in favour of a more aggressive one. The League . . . has amassed a substantial store of information about the activities of subversive groups and the individuals prominent in them. The League answers enquiries from the media as well as its own members and we see no necessity to continue to be reticent about the fact that we have such information or that it is available."

Gathering Information

The League's blacklist was compiled from a wide variety of sources. Some of them are legal, some illegal. Even when strictly speaking legal, some of these sources were scarcely legitimate - involving fraud, dishonesty and breach of professional ethics and the rights of individuals. This diversity of sources was reflected in the quality of the information. I have a copy of the index to the North West Region's blacklist in use in 1986, but some entries had been made thirty years earlier. It contains nearly 6,000 names and runs to 167 pages. Some entries are very detailed; providing full names, addresses, national insurance numbers and details of party political, campaign or trade union membership and Office. These entries certainly identify individuals and details could be checked. But most entries do not; addresses are not listed, national insurance numbers not available, full names are not given. In some cases occupations and areas of work are not given. The chaotic and dilettante nature of the files was underlined by the fact that, for example, a prominent Labour politician like Eric Heffer was entered twice; or that Roger Lyons (now general secretary of MSF) was listed under his long defunct Merseyside address; or more mundanely that the list included a "P. Smith of Manchester" with no indication that it was Peter, Paul or Paula.

In 1985 an internal League document called "The Need for a Change of Direction" was leaked to the Labour Research Department. It was written by employees of the League who were unhappy with some of the policy and organisational changes made to deal with life under Thatcherism. This document together with the League's own publicity, information from a small number of defectors from the League, and an undercover report by Granada TV's World in Action enable us to build up a clear picture of the sources used to compile the blacklist:

1. The Press: Names extracted from the radical left and the fascist's own papers. Names extracted from Trade Union Journals and local and national newspapers.
2. Participants on Training Courses
3. League Leafleters
4. Managers and Personnel Departments
5. Sympathetic or Naive Trade Union & Labour Party Members or Officials
6. League Officials Operating with "Deep Cover" in The Trade Unions
7. Names of Those Nominating "Extremist" Candidates in Local or National Elections
8. Contacts in the Security Services or Police Forces
9. Private Detective Agencies

Considering the severity of the consequences of being branded a subversive by the Economic League - long-term or permanent unemployment - it is remarkable that little of its evidence would bare scrutiny in any court of law. The League's sources generally provided circumstantial or hearsay evidence, open to personal or political manipulation and incapable of being confirmed even if the League had had the resources to do it. The blacklist index of which I have a copy frequently fails to identify a specific individual and information is out of date, sometimes by decades. Even where the source of the original information, such as personnel officers, could have provided information that positively identify just one person it was not updated.

Although it has been alleged that the League's blacklist contained as many as 250,000 names it seems that was an exageration and it was most likely to have been around 45,000. Speaking to MPs, trade unionists and journalists in the Houses of Parliament (in 1989) the former North West Regional Director, Mr. Richard Brett, suggested that 35,000 of the 45,000 files would have to be weeded out because they were either hopelessly inadequate or uselessly out of date. It was a charge with which the League more or less agreed. Speaking on the Channel Four television programme After Dark, in 1988 ^[11], Michael Noar, then Director of the League, refused to answer questions about the size of the blacklist because it was being overhauled. It was a far cry from Saxon Tate's claim in the 1980 Annual Report that:

"Members can have complete confidence that the League's work in both economic education and counter-subversion is characterised by strict adherence to provable facts."

As we have seen, even when Tate's statement was made the Guardian, for example, had already checked and challenged the League's information. Most subsequent checks by journalists - most notably the World in Action teams - have unearthed a catalogue of mistakes and misidentification by the League. But the mammoth difficulty that journalists have had in tracing a great many of the people on the North West's blacklist only went to underline its poor quality and the scale of the task facing the League's weeders. In the first of three television programmes about the Economic League produced by Granada TV's World in Action teams ^[12] Alan Harvey, an official of the North East Region, was secretly filmed describing the range of services available to businesses. Harvey described a recent case where he had recommended that a company not employ someone because he had the same surname as someone on the blacklist:

"We said, well look, you know, erm, by all means take the guy on if you want, but if it was me I would be a little worried about it because you are risking other people's jobs . . . But who do you risk? Do you risk ninety people, or a hundred people or even thousands of people, or one job?"

It presented a revealing insight into the way in which, at least some, League officials used the flawed collation of information, supposition, assumption and malicious gossip that made up the blacklist. Merely having the same surname as an alleged local subversive might prevent you getting a job with a Economic League subscriber. This attitude must have turned the recruitment procedure into a lottery in a large company which, like Fords until 1990, routinely submitted all potential employee's names to the League for processing.

In the face of the evidence, the League's claims for the accuracy of its vetting procedure are worthless. Neither a blacklisted individual nor the subscribing company could check the accuracy of League's information or assessment.

There was also substantially greater pressure on the League to avoid making the mistake of letting a trade union or political activist through the net than branding a few political inactive individuals as "trouble makers". There was also a simple market force on the League to encourage an employer to maintain its subscription by reinforcing the idea that there was a queue of "subversives" trying to obtain work with it. Harvey's safety first approach was likely to be shared by client companies, especially when with unemployment rising there might be very many suitable applicants for a post.

It was also an approach which the League felt had been endorsed by the declared "industrial strategy" of a number of Trotskyist and neo-Trotskyist groups during the 1970s, and by the example of the so-called "Cowley Moles". This was a clique of revolutionary socialists who all obtained work, at the same time, in British Leyland's Cowley plant in Oxford. Their aim was to establish a factory branch and act as a strong and militant force within the union there. The Economic League subsequently used the example of the "Cowley Moles" to promote, for example in its 1986 pamphlet "Companies Under Attack", the general need for political vetting of job applicants, and its own services especially. It was after all the League, working closely with the company, who had identified the "Cowley Moles" in the first place - although only after they had been given jobs at the plant.

The Economic League and MI5

The Economic League's blacklisting overlapped with the state's domestic intelligence services. The most clear cut example of this common ground would be in MI5, the secret service with primary responsibility for spying on British territory on British citizens and particularly "C" division of MI5 which until recent reorganisations handled security clearance for private firms with defence contracts. We know definitely that in the years before the Second World War the League supplied and received information from Special Branch and Naval Intelligence and that during the General Strike it was reporting to the Prime Minister. At a time when MI5 had barely two dozen agents it was a willing and vital source of intelligence. When Walter Citrine, first head of the nationalised British Electricity Authority, demanded a purge of communists in London Power Stations the investigation was carried out by Roger Hollis, the head of "C" division, and his junior, P A Osborne. Another graduate of this area of work was Martin Furnival Jones. Like Hollis he would also become head of MI5, but in 1942 he was "handling security at defence contractors". The Cold War saw the state, under the Labour leader Clement Attlee maintain its own blacklist aimed at preventing members of the CPGB from entering public service, and restricting or even dismissing communists already in employment. The League was there to show them how it was done, though to be fair under this "loyalty programme" the state at least challenged people to their face and allowed a formal appeal against its decisions. There is a persuasive body of circumstantial evidence of a continuing connection between British Intelligence and the Economic League after the Second World War: an already established relationship, a common cause (anti-bolshevism), a common tactic (the blacklist) and the League's employment of individuals with an Intelligence background. It would be truly incredible if MI5 had not sought and received information from the Economic League and its nationwide network of contacts in personnel departments. But there are other even more interesting questions raised by the relationship between MI5 and the Economic League: Did the League get financial assistance from the "Secret Service Vote" in Parliament, or did it, in contravention of the Official Secrets Act, receive information from the Secret Services? An unnamed informant in Duncan Campbell's book On the Record and a former officer in Army Intelligence (Major Colin Wallace) suggest that the League had office space in MI5 headquarters and did receive money from the "secret vote". Gary Murray, a former private detective who worked freelance for MI5, has also suggested that there was a two-way relationship between the League and MI5.

In the interwar period the scale of the League's operations had more than rivalled MI5's. But the Cold War enabled the Military and Intelligence establishments to remain on a war footing, and the League operations ceased to compare with the breadth or scale of state's own domestic surveillance. But the League did have facilities that the state's intelligence services could not easily match: routine contact with personnel departments and managers, regular and continuous "low level" intelligence from its "upfront" activities like leafleting and training, an eminently deniable mechanism for disseminating propaganda and if necessary disinformation, and a safe and deniable direct line to a small number of sympathetic trade unionists.

It also had one other facility that the Secret Services would have been happy to encourage. We know for certain that early in the 1960s the League had at least one of its employees working on a more or less full time basis inside the trade union movement. In 1988 World in Action revealed that a League employee called Ned Walsh had been working undercover in the trade union ASTMS, now MSF, for more than twenty years. While undercover agents did not account for a major part of the Economic League's budget, Walsh was not the only one operating and Regional Directors also cultivated their own small groups of paid informers.

MI5

The circumstantial evidence confirms the suggestions of men like Wallace and Murray and Duncan Campbell's un-named informant that there was some sort of special relationship between MI5 and the Economic League. But just how special was it? Did, for example, MI5 simply encourage the League to pass information on and then assess it cautiously and diligently because it originated from a politically motivated and interested party? The answer to this last question, at least in the 1970s, would seem to be a categorical "no". For in 1972, a man called Charles Elwell became head of F Branch of MI5. By the 1970s MI5 had evolved a structure involving six branches: A, B, C, D, S and F. Of these D and F Branches were the key Branches, with the others providing the operational and administrative support for their activities:

• F Branch was the section of MI5 responsible for domestic intelligence.

• D Branch (later renamed K Branch) which was responsible for monitoring the activities of the Soviet Union's intelligence operations in Britain and in British Territories.

• A Branch was responsible for its operational field work (telephone tapping, surveillance, etc.)

• B Branch was the personnel and legal department.

• C Branch was responsible for "security", of documents and buildings vetting employees in sensitive areas of work and investigating leaks.

• S Branch provided general back-up services, runs the registry of files and a joint computer database with MI6.

Although information from the Economic League would eventually end up in the hands of S Branch, and there was an overlap - in respect of defence companies - with the work of C Branch, perhaps the League's main point of contact with MI5 would have been through F Branch. ^[13] F "Division" had been created as part of the wholesale reorganisation of MI5 during the early years of the Second World War. At first surveillance of the CPGB and the left had been the responsibility of Roger Hollis, while Graham Mitchell took responsibility for surveillance of fascists. In 1945 Hollis became its Director, but moved to C Division in 1946 when he was succeeded by Graham Mitchell. In the years immediately after the Second World War there were at least two important MI5 figures we know to have been close to the Economic League since the 1920s: Guy Liddell, who had given National Propaganda a good reference in the 1920s, and Maxwell Knight, who continued to run agents in the CPGB until he retired in the 1950s. Although his activities are generally associated with B Division, then the counter-espionage section, he was also probably the first head of F4, F Division's agent running section, and his second in command, John Bingham (later Lord Clanmorris), certainly took up this position after Knight left the service.

In 1953 MI5 was again reorganised with Hollis now becoming its Deputy Director General, Mitchell becoming Director of "D Branch" (counter espionage) and Alex Kellar becoming Director of F Branch. Kellar, a Scot who had a background in international law, remained Director of F Branch until his retirement in 1965 when he was succeeded by Dick Thistlethwaite, who was almost immediately drawn into the events surrounding the seamens' strike. Thistlethwaite retired in 1972 and was replaced by Charles Elwell.

For most of the duration of the Cold War, F Branch failed to enjoy the same status as the spycatchers in D Branch. However (according to, for example, Peter Wright) there was a significant change of direction in 1972 with the appointment of a new Director General - Sir Michael Hanley. Under Hanley senior officers, including Elwell, were drafted across from counter-espionage to lead the work of the expanded F Branch, which now had seven sub-sections:

F1 - CPGB; F2 - Trade Unions; F3 - Anti-terrorism (non Irish); F5 - Irish Terrorism; F7 - Left-wing groups, right-wing extremists, MPs, teachers, lawyers and journalists.

F4 and F6 were essentially agent running sections, together known as, or run by, "FX". ^[14] F4 concentrated on the CPGB while F6 worked within the Trade Union movement.

Elwell's extreme right-wing political views were to cause MI5 profound problems. An accomplished career officer who in his thirties had interrogated Russian spies like Vassal and Gordon Lonsdale, he had also been responsible for debriefing the Czech defector Josef Frolik in 1968. When Frolik named the Labour government's Postmaster General, John Stonehouse, as a Czech agent Wilson insisted that Elwell confront Stonehouse with the allegation personally and in front of himself. Stonehouse, a particularly right-wing Labour man, passed the interview with flying colours and in his autobiography remembered Elwell as a "precisely dressed, clean cut sharp edged man in his early forties". "He had," he continued, "the manner of an ex-military man and was quietly confident and not at all overawed by the occasion or the situation."

Under Elwell F Branch had some notable early successes. Not least of these was the resolution, in its favour, of a long running dispute between MI5 and MI6 about who should be running operations in Northern Ireland. The scale of, and resources available for, operations against trade union activists also increased significantly. But the overtly political nature of F Branch's operations against the trade unions began to worry some officers. Michael Bettaney was a young F Branch officer from a working class background. His first posting, for two years, to Northern Ireland was particularly difficult. Early on he was injured in a car bomb attack and later had to hide in one room while his informant was knee-capped in another. He returned, disillusioned, to work in F3 until 1982 when he was transferred to the counter-espionage section, K Branch. Not long after his transfer he tried to make contact with the KGB with the aim of passing on secret information, which he had been amassing since his transfer. The KGB couldn't believe their luck, and did not take him seriously. In September 1983 he was arrested before he had chance to pass on any information at all. At his trial, during which he claimed to have been ideologically motivated, he was given a 23 years sentence with the stipulation that he remain isolated from other prisoners. A rather sad and pathetic figure had been transformed into a latterday "man in the iron mask". Without endorsing his actions two former colleague's were so outraged that they felt they had to go public. His former secretary, Miranda Ingram, wrote an article in his defence in New Society. There she claimed:

"In the prevailing right-wing atmosphere an officer who dissents from the official line does not feel encouraged to voice his concern." ^[15]

Two weeks later Cathy Massiter, a former F Branch officer, wrote a letter to New Society in Bettaney's defence:

"Michael Bettaney is not some kind of anomaly . . . but is to a large extent a product of the security service itself. Though his reactions were extreme, the conflicts and dissatisfactions which provoked them were far from rare."

Within a year Massiter went on to become the focus of a now famous television programme - "MI5's Official Secrets" - which raised a storm of controversy by revealing the extent of F Branch's surveillance of trade unions and pressure groups like the Campaign for Nuclear Disarmament. The state's brutal treatment of Bettaney continues today, exacerbated by the completely implausible suggestion by the double agent Andrei Golytsin that he himself had to defect hurriedly because the supposedly isolated Bettaney had blown his cover to "Irish friends" in prison.

But the Bettaney case had started a train of events which did the British Intelligence community no good at all. Although Bettaney today still languishes forgotten in prison, neither Miranda Ingram nor Cathy Massiter were prosecuted and the state's failure to act against Massiter in particular is widely believed to have prompted Peter Wright to publish Spycatcher.

The expansion of F Branch under the Directorship of Elwell had resulted in a disturbing increase in activities against trade unions and non-subversive pressure groups in Britain. In the early years of his Directorship it had been an F6 officer who had given the "Clockwork Orange" briefing to Colin Wallace in Northern Ireland.

It ought not to be surprising to find therefore that after his retirement at the end of the decade Elwell put his services at the disposal of the Radical Right. In 1983 he wrote a pamphlet for the "Social Affairs Unit" called "Tracts Beyond the Times - a brief guide to the communist or revolutionary marxist press". The Social Affairs Unit was a subsidiary of the "Institute of Economic Affairs", a Conservative think tank which had been founded in the 1950s and specialised in the promotion of unregulated free enterprise. At the time that Elwell was involved with it was being run by Lord Harris of High Cross and Nigel Vinson, who together with Thatcher and Joseph had founded the Centre for Policy Studies.

"Tracts Beyond the Times" is perhaps the best evidence of the political obsessions of F Branch under Elwell. In addition to the self-proclaimed marxist press, like News Line and Socialist Worker, it contains entries on Anti-Apartheid News, Sanity, Tribune, Labour Herald and Searchlight and bulletins produced by the National Council for Civil Liberties and the Haldane Society of Socialist Lawyers. At the same time Elwell became a regular contributor to another organ of the Radical Right, the "Common Cause Bulletin". Common Cause was a relatively small and strange gathering point for the fanatical anti-Communists, which had enjoyed some connection with the ultra-right of the Labour movement and advocates of racial purity like Lady Jane Birdwood. A spokesman for Common Cause later told the journalist Mark Hollingsworth that Elwell was never formally a member of their group and had been introduced to them by Brian Crozier; who was an important element in their strategic intervention in British politics. Using money from the CIA he had helped to set up the Institute for the Study of Conflict and ran a number of its front companies like the publishing firm Forum World Features.

Elwell's last known political venture was as editor of an extremely secret right-wing monthly journal known as "British Briefing". Copies were distributed to a strictly limited number of reliable recipients who were asked, if they made use of the information it contained, not to name it as the source. Although its existence eventually became known, and the source of finance behind it, copies are still almost impossible to obtain with probably no more than two, of which I have copies, in non-right-wing hands.

"BB", as it was called by its recipients, was funded by the millionaire "libertarian" conservative David Hart. A flamboyant figure, whose belligerent preaching of fundamentalist conservative individualism probably terrifies more Conservatives than it has inspired, Hart is a close adviser and friend to Margaret Thatcher. During the miners strike he was given the role of Thatcherite minder and fixer for the dangerously liberal-minded Peter Walker, the energy secretary and the last true "wet" in a Thatcher Cabinet. One of his roles had been to organise the financing of the working miners' groups which were a key part in Thatcher's objective of crushing the National Union of Mineworkers. On the eve of the 1987 General Election, Hart formed his own organisation "The Committee for a Free Britain" which ran a series of powerful and outrageous anti-Labour newspaper adverts, for which the expression "scaremongering" seems somehow inadequate. ^[16]

Before Hart took it over, "British Briefing" had been called "Background Briefing on Subversion" and the implication I was given by Hart himself was that he inherited Elwell with the title. The name was said to have been changed to tie in with another of Hart's publications - "World Briefing", which was also distributed to key opinion formers on the right. Hart was not the only source of money - he raised some from Rupert Murdoch - but Hart controlled it. Articles in the two issues I have refer back to previous issues and suggest that they are fairly representative in containing numerous allegations against Labour MPs for their "communist sympathies" and national and international charities for their "communist affiliations". In the issue for December 1986 it highlighted particularly War on Want, Shelter - "which have frequently been mentioned in BB" - and "Child Poverty Action" - "the subject of a major article in BB 6/86". It also carried an article heavily critical of the anti-racist work of the British Council of Churches and the World Council of Churches, and less surprisingly about the "Anti-Economic League Campaign". The only Conservative MP to receive a critical mention was Richard Shepherd, who had just opposed the new official secrets act but was actually criticised for talking to a journalist from the Morning Star.

"British Briefing" is thus another revealing insight into the thinking of the Head of F Branch of MI5 during the 1970s, a key period which saw it increasingly in conflict with and operating against the leadership of all the main democratic political parties. It was not the sort of atmosphere in which this particular branch of the secret state was going to hold the Economic League at arms length, or view with healthy scepticism any of its alarmist reports. Ironically David Hart, the man who had financed British Briefing, could not even bring himself to wholeheartedly endorse Elwell's line in "British Briefing" and told me that his involvement had been primarily motivated by his regard and liking of Elwell personally. Hart told me that he thought that the Economic League were "wankers".

Mischeevous Strangers

The Economic League did not invent the employment blacklist, nor the idea of what Dickens had one of his characters call "the mischeevous strangers", deliberately whipping the otherwise loyal and honest working man and woman into a political frenzy. But, for all its amateurishness and shoddiness, the League's blacklist was the most concerted and practical effort to organise one throughout British industry and commerce. The concept of a politically motivated radical socialist or communist insinuating themselves into a company with the sole aim of bringing it to its knees was the key selling point for the blacklist. And by the early eighties the blacklist was the key to the Economic League's continuing existence. That there were these sorts of ultra-leftist conspiracies is not in doubt. However the crucial question is whether they ever posed a serious threat, and whether they justified the sort of draconian response adopted by the League or MI5.

It was however never in the Economic League's, or for that matter MI5's, interest to query the party-building propaganda and self-delusions of the radical left. They were far too good an excuse for operating against the mainstream of the Labour movement. Nor was it particularly helpful for an employer, or for that matter Labour Prime Minister, to challenge the notion that the root cause of their industrial relations problems was a tightly-knit group of "mischeevous strangers".

Perhaps Stephen Blackpool, Dickens' honest-but-doomed working man in Hard Times, realised this too. Having refused to join a union and thus being sent to Coventry by his workmates, Stephen is summoned before his employer, Josiah Bounderby, to be cross examined about the events in the hope of uncovering the ring leaders. Stephen resists Bounderby's attempts to extract information from him, and is consequently treated to a diatribe about the outsiders who had been allegedly inciting industrial action and organisation in the Mill. Eventually Stephen's patience breaks, with eventually disastrous consequences:

"Mischeevous strangers!" said Stephen, with an anxious smile; "when ha we not heern, I am sure, sin ever we can call to mind, o' th'mischeevous strangers! 'Tis not by them the trouble's made, sir. 'Tis not with them't commences. I ha no favor for 'em - I ha no reason to favor 'em - but 'tis hopeless and useless to dream o' takin them fro their trade, 'stead o'takin their trade fro' them!"

Of course the Economic League was all about keeping that "hopeless and useless" dream alive.

Notes and References

(see Bibliography for full details)

1. ^ Guardian 28/6/89, referenced in Stephen Dorril and Robin Ramsay, "Smear", Harper Collins, 1991
2. ^ "Evening News", 22/6/66
3. ^ Christopher Dobson and Ronald Payne, "Dictionary of Espionage", Harrap, 1984
4. ^ 12/1/61
5. ^ "The Guardian", 30/1/64
6. ^ "Observer" 19/10/69
7. ^ "Building Design" 8/5/70
8. ^ "Sunday Times" 11/4/74, "Time Out" May 1974, "The Guardian" 11/5/74
9. ^ "The Guardian" 23/4/77
10. ^ "The Guardian 28/6/78, 29/6/78
11. ^ Broadcast live: 10/9/88
12. ^ Broadcast on 16/6/87
13. ^ I was told by a source within the League that while Defence Companies use C Branch, MI5's post office box - PO Box 500 - to vet names this gave the companies only a "yes" or "no" answer while the League would provide the company with a clue as to why a person had failed the vetting procedure. This might be havebeen regarded as important if the person was already employed and about to be transferred or promoted to secret work.
14. ^ The published literature is unclear whether FX was a super section, or its head.
15. ^ 30/5/84
16. ^ The membership of the Committee was at first unknown. The CFB survives today, run by David Hart and some of the brighter members of the now disbanded Federation of Conservative Students. Hart operates from a presidential office near Buckingham Palace.