Labour’s response to Thatcher: The Policy Review (1987-92)

Labour’s third consecutive defeat at the hands of Margaret Thatcher in 1987 catalysed the party’s modernisation. In the period between the 1987 and 1992 general elections Labour attempted to rebrand and renew itself in response to the dominance of Thatcher’s Conservatives. During these years, at the behest of the soft-left leader, Tom Sawyer, Labour launched both a wide-ranging Policy Review and a comprehensive consultation exercise, Labour Listens. This paper argues that between 1987 and 1992 the Review, fundamentally altered Labour’s positions on Europe, nuclear disarmament, trade union legislation, and the market.

This paper highlights the significant, and largely undocumented, role of Sawyer in shaping the Policy Review process. He provided the organisational framework for the Review, forming seven Review Groups to investigate key policy areas. The review unfolded in four phases, each contributing to a gradual, but decisive shift in Labour’s ideological and policy direction by 1992.


It has been previously argued that the Policy Review changes were a conscious attempt to play ‘catch up’ with Thatcherism. However, this paper argues that despite accepting key elements of the Thatcherite settlement – such trade union legislation and a retreat from outright nationalisation - Labour’s retained a distinct social democratic identity. Although the Review carefully studied Thatcherism, it did not simply mirror it, providing a social democratic response to public opinion in key policy areas.

The Review marked a watershed moment for the Labour Party, breaking decisively from the left-wing policies of their 1983 manifesto, which had only partially been diluted by 1987. Following the Policy Review, Labour’s 1992 manifesto was almost unrecognisable from its 1983 and 1987 predecessors. These policy changes provided the bedrock from which ‘New’ Labour could be built after 1994.