If Bonar Law is our unknown prime minister, Jim Callaghan is the most underrated. His years at No 10, between April 1976 and May 1979, are too often regarded as just an interlude between the Wilson and Thatcher eras, or, more broadly, between the hedonism of the Sixties and the capitalism of the Eighties. Yet in fact they witnessed episodes of immense importance for our history, with the political and economic trauma of the IMF crisis near the start, the trade-union-led ‘winter of discontent’ at the close, and crucial policy developments in education, the economy, devolution, Europe, the Middle East and defence in between. Callaghan himself, with a mixed record in the three other major offices of state, emerged as a commanding leader. In the view of Denis Healey, he was ‘our best prime minister since Attlee’.
Bernard Donoughue, a No 10 adviser unknown to the general public, was a major player in these years. He headed the Prime Minister’s Policy Unit, a new institution continued from Harold Wilson, which amounted to a revolution in central government. It meshed, not very comfortably at times, with the traditional