MercoPress. South Atlantic News Agency

How the Gibraltar naval dockyard was saved from the axe back in 1981

Foreign Secretary Peter Carrington feared a major constitutional crisis

British ministers feared the closure of Gibraltar’s naval dockyard would throw the local budget into “chronic deficit” and precipitate a “constitutional crisis” according to newly-released files, some of which were published by the Gibraltar Chronicle.

Documents revealing behind-the-scenes discussions on the future of the naval dockyard in Gibraltar are among thousands of papers from 1981 released on Friday to The National Archives in London under the 30-year rule.

The controversial plan to close the dockyard was part of wide-ranging defence cuts proposed by Mrs Thatcher’s Conservative government. But new documents reveal that the Foreign Secretary Peter Carrington had serious concerns about the proposal and appealed to the Defence Secretary John Nott to re-think.

In a letter dated 5 June 1981, Carrington warned that closing the dockyard would result in “upwards of a thousand redundancies” raising unemployment from “virtually zero to about 10%”. It would reduce national income by “perhaps 13%” throwing Gibraltar’s budget into “chronic deficit”.

The proposal was clearly at odds with the British government’s commitment to “support and sustain” Gibraltar while Spanish restrictions were in place, wrote Carrington. If the dockyard was closed, the UK government would have to find other means of supporting Gibraltar, cancelling out any potential savings. Carrington also thought the proposal would damage the prospects of getting Spain to reopen the border.

“Closure of the dockyard would be seen in Spain as well as in Gibraltar as a major shift in policy, putting in question after 12 years of the current siege the determination of the British Government to support the Gibraltarians,” he wrote.

The Spanish Government’s reaction, he feared, would be to shelve plans to implement the Lisbon agreement and to wait for pressure on the Gibraltarians to build up.

In a second letter, two weeks later, Carrington wrote that the dockyard closure plan continued to cause him “great difficulty”. It was “incompatible” with the government’s commitment to support Gibraltar as long as the “Spanish policy is one of intimidation and harassment”.

“The reaction in Gibraltar would be bound to be adverse”, warned Carrington. “If we fail to consult in advance and it looked as though we were reneging on the commitment to ‘support and sustain’, Sir Joshua Hassan might well resign in protest and we could find ourselves with a constitutional crisis on our hands.”

In response to these concerns, the Defence Secretary John Nott agreed to remove any mention of Gibraltar from his parliamentary statement on the defence cuts pending further discussions.

Geoffrey Howe, the Chancellor of the Exchequer, was concerned that savings resulting from the closure of the dockyard should not be off-set by additional aid. In a letter to Nott he said it should be made clear to the Government of Gibraltar that Britain’s obligation to support the economy of Gibraltar “only refers to the current situation in which Spanish restrictions on the border make life difficult…If the restrictions were lifted we would recognise no such obligation.”

The Royal Navy Dockyard in Gibraltar eventually closed in 1984. After various owners the site continues as a commercial ship repair facility and is now known as Gibdock.