John Davies (businessman)

John Emerson Harding Harding-Davies PC MBE (8 January 1916 – 4 July 1979) was a successful British businessman who served as Director-General of the Confederation of British Industry during the 1960s. He later went into politics and served in the Cabinet of Edward Heath as the first Secretary of State for Trade and Industry. In 1972, he became Chancellor of the Duchy of Lancaster.

Family and early life

Davies was born in Blackheath, London on the 8 January 1916, the second son of Arnold Thomas Davies (1882–1966) a Chartered Accountant from Folkestone, by his wife Edith Minnie Harding (1880–1962) only child of Captain Francis Dallas Harding (1839–1902) and Minnie Mary Malchus of Calcutta. Davies went to Windlesham House School in Sussex and St. Edward's School in Oxford, both boarding schools. He followed his father into accountancy as an articled clerk from 1934; he had just obtained professional qualifications as the youngest Chartered Accountant in the country in 1939, when the outbreak of World War II led him to enlist in the Royal Army Service Corps. Davies was commissioned as a Second Lieutenant and spent most of the war in the Combined Operations headquarters. From 1945 he worked for Combined Operations Experimental Establishment (COXE), and received the MBE on demobilization in 1946. On the 8th of January 1943, he married Vera Georgina Bates, only child of George William Bates, Managing Director of Bata Shoes by his wife Elvina Rosa Taylor. The marriage produced two children; a daughter - Rosamond Ann, and a son - Francis William Harding Davies.

Business career

He joined the Anglo-Iranian Oil Company as an accountant in the marketing division. He qualified as a Fellow of the Institute of Chartered Accountants in 1949. Davies worked for the company in London, Stockholm and Paris; the company renamed as British Petroleum in 1954. In 1956, Davies was promoted to be General Manager (Markets) for BP, and in 1960 he was Director of BP Trading.

Management

The next year, Davies was appointed as Vice-Chairman and Managing Director of Shell-Mex and BP Ltd, which put him in charge of a national chain of petrol stations. He also became a Director of Hill Samuel Group. Due to his position he was made a member of the grand council of the Federation of British Industry, and chaired a committee on technical legislation. His conduct on that committee was impressive.

CBI Director-General

The Federation merged with British Employers' Federation and the National Association of British Manufacturers in 1965 to form the Confederation of British Industry. Davies was appointed as its Director-General from that July, wanting the organisation to have a much higher profile than previously. He supported initiatives such as the National Economic Development Council where government, employers and trades unions met to discuss the economy, and set up a joint CBI-TUC joint committee. He was also supportive of British entry into the European Community when the government applied in 1967.

Davies surprised some such as Enoch Powell in May 1967 when he made a speech in California in which he observed that the Labour government's measures to keep pay and prices down were working; Powell considered this not only untrue but an example of collaboration in which "the very spokesmen of capitalism" were doing the work of the socialists. As CBI chief Davies had some quango appointments as a member of the British Productivity Council, the British National Export Council and the Council of Industrial Design. He was briefly a member of the Public Schools Commission.

However Davies was a Conservative by instinct and after the devaluation of the Pound sterling in November 1967, he became much more critical of the government. Increasingly he would lambast Labour ministers on television, although he continued to work together with Ministers in private. Davies handed over the title of Director-General to Campbell Adamson in 1969.

Political career

In 1969 Davies was recruited by Edward Heath to join his government once he won the next election. Heath was looking to lead a 'businesslike' government and believed that senior business figures serving in senior posts would provide more expert management. Davies began to be more quotably critical, describing the "solemn and binding" accord between the government and the TUC (after the failure of "In Place of Strife") as useful only in the lavatory.

He failed to win the selection for the Conservative nomination at the Louth byelection of 1969, and for Cities of London and Westminster for the general election. However, with Central Office support, Davies was found a seat at Knutsford in Cheshire, which he easily won in the general election on 18 June 1970.

Davies was appointed as Minister of Technology (in the Cabinet) on 28 July in a reshuffle following the death of Iain Macleod. He was described by Margaret Thatcher as someone who "knew nothing of politics", and Enoch Powell was directly critical of Heath for appointing Davies: he compared Davies' appointment to that of the Roman Emperor Caligula appointing his horse as a Consul.

Trade and Industry

That October, Davies was promoted to be Secretary of State for Trade and Industry, a new department set up by Heath. He introduced himself at the Conservative Party Conference with a speech which reiterated Heath's pre-election policy of refusing to intervene in industry. The phrase most closely associated with him was said in the House of Commons on 4 November, when Davies said:

"We believe that the essential need of the country is to gear its policies to the great majority of people, who are not 'lame ducks', who do not need a hand, who are quite capable of looking after their own interests and only demand to be allowed to do so." (Hansard, 5th Series, volume 805, column 1211)

The term 'lame ducks' became associated with Davies. However, when Rolls-Royce (a vital defence contractor) ran into financial difficulties early in 1971, it was decided that the government should help by bailing it out. When nugatory efforts did not help, the company was nationalised to prevent it from going bankrupt.

In June 1971 the Upper Clyde Shipbuilders went into receivership after the government refused it a £6 million loan. The workers at the yard, led by Communist shop stewards, decided to hold a 'work-in' when they occupied the yard and continued production. This industrial action tended to refute claims that trades unions were work-shy and was therefore embarrassing to the government; it also showed up Davies' clumsy handling of the press. Davies' London home was firebombed by the Angry Brigade on 31 July 1971. In February 1972 the government changed its policy and decided to retain three of the four shipyards at a cost of £35 million, although Davies knew they would never operate on a commercial basis.

Later that year Davies presented a white paper on Industry in which it became apparent that the government was willing to support failing firms in the light of an economic downturn. Although Davies' department was in charge, the white paper was the work of others, and the change of policy became known as 'the U-turn'. When making the policy announcement in the House of Commons, Labour MPs cheered while Conservatives were almost silent; Davies' subsequent appearances in the House of Commons were met with jeering and calls of "Minister for Lame Ducks". To Davies' embarrassment, the CBI condemned the government's new policy as "back-door nationalization".

Chancellor of the Duchy of Lancaster

Davies moved sideways to become Chancellor of the Duchy of Lancaster in November 1972, with special responsibility for British relations with the European Community which Britain joined on 1 January 1973. Davies' role was predominantly behind the scenes in making sure British law was in compliance with European law. In Cabinet discussions, Davies advocated a confrontational approach to the trade unions, although he feared for the future.

Opposition

After Heath left office in 1974, Davies retained his Parliamentary seat but was not given a post in the Shadow Cabinet. He resumed his directorship of Hill Samuel. From May he took the Chairmanship of the European Scrutiny Committee of the House of Commons, examining the details of legislation, and won a strong reputation for looking in detail at the regulations coming out of the EC institutions. In 1975, Davies campaigned for a 'Yes' vote in the referendum on EC membership.

Davies was nominated by the Conservative Party as a European Commissioner for the term beginning in 1977, but was unacceptable to the Labour government. However in November 1976 Margaret Thatcher decided to sack the unimpressive Reginald Maudling as Shadow Foreign Secretary and appointed Davies to replace him. Although Mrs Thatcher's memoirs give praise for the effectiveness of Davies' work in the role, this was not the view of most contemporary observers.

He had a low profile and was not in a position to stand up to Mrs Thatcher if they were ever in disagreement. He was not a strong supporter of monetarism, although he did agree with Thatcher's view on Soviet expansionism. The major disagreement within the Conservative Party was over Rhodesia and whether to continue sanctions on the government of Ian Smith: Davies believed that Smith was not entirely committed to a negotiated peace and therefore that sanctions should be maintained. His speech at the 1978 Conservative Party conference defending sanctions was regarded as rambling and was met with loud heckling.

Illness and death

The reason for Davies' poor performance was partly due to the effects of a malignant brain tumour which was diagnosed a few weeks later. Davies swiftly stood down from the Shadow Cabinet and from Parliament. In the Queen's birthday honours list of 1979, he was awarded a life peerage, but before he could agree on a title, Davies was dead from a relapse. By Royal warrant on 27 February 1980, his widow Vera Georgina was granted the style and title of 'Lady Harding-Davies', indicating the title Davies had intended to take; his children were given the rank of children of life peers. ["Peerage Law", R. P. Gadd, ISCA Publishing, Bristol, at page 86]

References

* Appendix One, "The Biographical Dictionary of Life Peers" by W. D. Rubinstein (St Martin's Press, 1991)
* "The Path to Power" by Margaret Thatcher (HarperCollins, 1995)
* "John Emerson Harding Davies" by Jason Tomes in Oxford Dictionary of National Biography (Oxford University Press, 2004)