The Defence of the Realm (60 page)

VE Day was the greatest day too in the history of the Security Service. Its members did not rank their own contribution to victory as high as those of the armed services and their allies who had risked, or lost, their lives in battle. But they were right to believe that, by their comprehensive victory over German intelligence, they had saved many lives. Few, if any, of those who knew the secret of the Double-Cross System believed that it would ever be revealed. When Sir John Masterman (knighted in 1959) published his now celebrated history of it in the United States a quarter of a century later, many past and present members of the Service were deeply shocked. The Director General, Sir Martin Furnival Jones, who had joined the Service a few months after Masterman, wrote to him: ‘I consider your
action disgraceful and have no doubt that my opinion would have been shared by many of those with whom you worked during the war.'
¹⁵⁸
Though Tar Robertson was dead, his former deputy John Marriott refused to speak to Masterman again.
¹⁵⁹

The wartime success of the Double-Cross System initially raised exaggerated expectations about the potential use of deception in the Cold War against Britain's former wartime ally, the Soviet Union. As early as February 1944, the LCS argued that ‘organised deception should henceforth form an essential part of any modern war machine';
¹⁶⁰
its Controlling Officer, Colonel Bevan, argued in some detail in a post-war report that strategic deception ‘may almost be classed as a new weapon'.
¹⁶¹
The LCS was directed in 1949 to ‘lay the necessary foundations to ensure the immediate use of deception from the start of any future war'.
¹⁶²
Post-war service chiefs showed great interest in the use of double agents. Guy Liddell warned in April 1951: ‘Our main difficulty may not be so much to persuade senior officers to allow us to run double-agents, but to prevent them from making us run everything in sight as a double-agent.' There was, however, never any prospect that a Double-Cross System directed against the Russians could achieve anything approaching the level of success achieved against the Germans. ‘It would', wrote Liddell, ‘be extremely difficult to “do it again” on the Russians.'
¹⁶³
When his friend, the former MI5 agent Guy Burgess, and the diplomat Donald Maclean defected to Moscow the following month,
¹⁶⁴
Liddell must have realized that a Cold War Double-Cross System would be even more difficult than he had supposed.

Section D

The Early Cold War

Introduction

The Security Service and its Staff in the Early Cold War

For the small circle of those indoctrinated into the Double-Cross System, the Security Service emerged from the Second World War trailing clouds of glory from the most successful deception in the history of warfare. But for many of the Labour MPs elected in the landslide victory of 1945, who knew nothing of MI5's contribution to victory, its reputation was clouded with suspicions dating back to the Zinoviev letter of 1924, which they blamed for the fall of Ramsay MacDonald's first Labour government.
¹
When Petrie retired as DG in the spring of 1946, the internal candidates to succeed him were passed over in favour of the Chief Constable of Kent, Sir Percy Sillitoe, whom the new Prime Minister, Clement Attlee, trusted to keep the Security Service, so far as possible, on the straight and narrow path of political impartiality. Sillitoe was a large man with a powerful physical presence and a reputation as a crimebuster.
²
Attlee was far from his only supporter in Whitehall. At interview in November 1945 Sillitoe outperformed the rest of a strong shortlist which included General Sir Hastings ‘Pug' Ismay, who had been Churchill's Chief of Staff, General Kenneth Strong, Eisenhower's British intelligence chief (to whom Ike was devoted), and William Penney, Mountbatten's intelligence chief (also highly regarded). The PUS at the Foreign Office, Sir Alexander Cadogan, noted in his diary that the Whitehall interviewing committee ‘were unanimous in choosing Sillitoe . . . I certainly thought he was very good.'
³

Few senior officers in the Security Service agreed with the Whitehall committee. Apart from being disappointed not to become DG, Guy Liddell, head of B Division (intelligence),
*
believed:

(1)  It is a mistake to appoint a policeman since the work of this office is entirely different from police work.

(2)  It puts the stamp of the Gestapo on the office.
⁴

(3)  It creates a false impression in the minds of police forces generally and of the Services that MI5 is a kind of police dept.

(4)  It generally down-grades the office.

Liddell did not think Sillitoe had sufficient stature for his influence in Whitehall to compensate for his lack of intelligence experience. And it was ‘extremely discouraging for the younger members of the office and for others coming in, to feel that the head of the office is likely to be appointed from outside'.
⁵

Sillitoe made no secret of his distrust of ‘Oxbridge types' and ‘long-haired intellectuals'. Since the two senior MI5 officers who were to succeed him as DG – Dick White and Roger Hollis – were both ‘Oxbridge types' (though not long-haired), the omens were bad. Sillitoe's son later recalled an occasion when, convinced that his directors were trying to humiliate him by quoting Latin epigrams he could not understand, the DG stormed out of the Security Service headquarters, white-faced with rage: ‘When we got into the car I asked, “What was that all about?” He said, “One word – bastards!” He would return home to the flat in Putney night after night and tell my mother, “Dolly, I can't get to grips with a brick wall!” '
⁶
Even Bill Magan (later one of the Service's leading directors), who got on well with Sillitoe personally, recalls that the DG ‘never understood MI5 and was surrounded by men more intelligent and better educated than himself'.
⁷
According to Norman Himsworth, Sillitoe did not help himself by swearing ‘like a fishmonger's wife'.
⁸

The powers which Sillitoe acquired on his appointment as DG were constitutionally remarkable by present-day standards with no basis in statute. A report by Sir Findlater Stewart, chairman of the Security Executive, had concluded on 27 November 1945: ‘The purpose of the Security Service is the Defence of the Realm and nothing else . . . There is no alternative to giving [the DG] the widest discretion in the means he uses and the direction in which he applies them – always provided he does not step outside the law.'
⁹
Since the Security Service's powers were not defined by statute, however, it was unclear what their legal limits were. Though it was supposed that the authority for the interception of mail and telephone calls through Home Office Warrants (HOWs) ultimately derived from royal prerogative, the precise origin of the power to conduct telephone intercepts was ‘a little hazy'.
¹⁰
A Committee of Privy Counsellors twelve
years later could find no basis for the power to intercept communications other than ‘long usage', but recommended that the practice continue subject to HOWs. ‘This means', Sir David G. T. Williams QC later concluded, ‘that the Security Service, itself a body unrecognised by law, continues to rely upon a practice which is also not recognised by law.'
¹¹

Sir Findlater Stewart's November 1945 report also called for the reform of the confused chain of ministerial responsibility for the Service established during the war:

It was controlled by the Home Secretary so far as it used the special postal powers, and the Treasury was responsible for providing it with funds. But the responsibility for its direction
as a Service
was a more difficult matter. From the summer of 1940 it rested with Lord Swinton, as Chairman of the Security Executive (he was, of course, not a Minister), then with Mr Duff Cooper, while he was Chancellor of the Duchy [of Lancaster]. It then went to Mr Eden, but only in his personal capacity and
not
as Foreign Secretary.

. . . I feel strongly that the time has come to regularise the position . . . The Minister responsible for it
as a Service
(though not for action taken by other Ministers on its advice) should be the Minister of Defence, or, if there is no Minister of Defence, the Prime Minister as Chairman of the Committee of Imperial Defence.
¹²

Probably because of his initial suspicions of the Security Service, Attlee wished to keep personal control of the Service rather than delegate to the Minister of Defence. Sillitoe was instructed before taking office on 1 May 1946: ‘You will be responsible to the Prime Minister to whom you will have the right of direct access. It will be your responsibility to keep the Prime Minister constantly informed of subversive activities likely to endanger the security of the State.'
¹³

Soon after his appointment as DG, Sillitoe told Liddell that ‘He would be seeing the PM at least once a fortnight on the latter's special instructions.'
¹⁴
Though they do not seem to have met quite so often, Sillitoe saw the Prime Minister far more frequently than any subsequent DG for the remainder of the twentieth century. Sillitoe's right of direct access to Attlee was a considerable asset for the Security Service which, as Dick White later acknowledged, he and other senior officers with a low opinion of the DG failed to exploit adequately.
¹⁵
Sillitoe was a rare (perhaps unique) example of a DG who inspired greater confidence in Number Ten than in his own staff. After succeeding Harker as DDG in October 1946, Liddell sometimes stood in for Sillitoe (notably during the DG's lengthy visits to the Empire and Commonwealth) at meetings with the Prime Minister. He too won Attlee's confidence but, like other visitors to Number Ten, sometimes
found the Prime Minister's taciturn manner disconcerting: ‘You say your piece and when you come to the end there is a long pause – you then begin the next item on the agenda. I think it is to some extent due to a curious shyness, which he radiates, and indeed imparts to his visitors. He does not often look you in the face.'
¹⁶

The traditional culture of the Security Service, however, was to keep ministers at arm's length. Guy Liddell wrote dismissively in 1950:

Intelligence matters were usually of such complexity that the less Ministers had to do with them the better. It was far better to get things settled, if possible, on a lower level; Ministers had not really got the time to go into all the details. If therefore they were required to make a decision, it is as likely as not that it would be the wrong one!
¹⁷

The head of the civil service, the cabinet secretary and the Home Office PUS were each far better informed about the Security Service than most of the cabinet. During the Attlee government and most of the three following Conservative administrations, the Service benefited from the confidence of the immensely influential Sir Norman Brook, assistant cabinet secretary from 1945 and cabinet secretary from 1947 to 1963. In 1950 Brook was asked by Attlee to carry out an inquiry into the Service. He told Liddell afterwards that ‘there was really practically nothing that he could criticise.' Brook had initially been ‘inclined to think that the manpower and efforts devoted to the work of B1 [counter-subversion] were perhaps out of proportion with those of B2 [counter-espionage] but in arguing his case with the officers concerned he had been entirely persuaded that this was not so.'
¹⁸
Brook went on to become one of the closest confidants and advisers to both Winston Churchill and Harold Macmillan.
¹⁹

Soon after Sillitoe's appointment as DG, he was instructed to inform the Prime Minister and him alone about any MP of whatever party who ‘is a proven member of a subversive organisation'.
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Attlee also expected to be kept informed about signs of subversion among ministers' families. When, under Churchill's peacetime government in 1952, the DG was made directly responsible to the Home Secretary (then Sir David Maxwell Fyfe) rather than the Prime Minister, Sillitoe told him that he had been ‘accustomed to confide in the Prime Minister certain delicate matters which came to the notice of the Security Service from time to time and which concerned the personal affairs of Ministers', such as the case of ‘a Minister's son who had become involved with certain people under investigation by the Security Service and who had given information to these people in return for some kind of reward'.
²¹

The 1952 Maxwell Fyfe Directive (kept secret until it was published in the wake of the Profumo scandal a decade later), which the Security Service regarded as its charter, reaffirmed ‘the well-established convention whereby ministers do not concern themselves with the detailed information which may be obtained by the Security Service in particular cases, but are furnished with such information only as may be necessary for the determination of any issue on which guidance is sought'. The Service's role was defined as follows:

The Security Service is part of the Defence Forces of the country. Its task is the Defence of the Realm as a whole, from external and internal dangers arising from attempts of espionage and sabotage, or from actions of persons and organizations whether directed from within or without the country, which may be judged to be subversive of the state.

Though instructed to avoid any political or sectional bias, the DG was left free to judge what was ‘subversive of the state'. Unlike SIS and GCHQ (the successor to GC&CS), the Security Service was thus essentially selftasking.
²²

When Guy Liddell retired from the Service in 1952 at the age of sixty to become head of security at the Atomic Energy Authority, Dick White succeeded him as DDG. Relations between White and Sillitoe did not improve. White later recalled, ‘I found Sillitoe vapid and shallow and frequently wrong. I was close to leaving to try my hand at something else.'
²³
Before retiring as DG on 31 August 1953, Sillitoe cut his ties to the Security Service in dramatic and unprecedented fashion by ordering the destruction of his record of service.
²⁴
Maxwell Fyfe delegated the shortlisting and interviewing of candidates for the succession to Sillitoe to a high-powered committee of Whitehall mandarins, chaired by the head of the civil service and former cabinet secretary Sir Edward Bridges.
²⁵
The Committee acknowledged that Guy Liddell had ‘unrivalled experience of the type of intelligence dealt with in MI5, knowledge of contemporary Communist mentality and tactics and an intuitive capacity to handle the difficult problems involved'. But ‘It has been said that he is not a good organiser and lacks forcefulness. And doubts have been expressed as to whether he would be successful in dealing with Ministers, with heads of department and with delegates of other countries.'
²⁶
The Committee concluded that the two strongest candidates were Dick White and General Sir Kenneth Strong (who had been shortlisted in 1945). Following interviews with both, Maxwell Fyfe told Churchill that he agreed with a majority on the Committee in recommending White: