A pounds 40,000 a year ex gratia allowance available to all former prime ministers was introduced after strong personal representations by Baroness Thatcher about her own loss of earnings when she was ousted in November 1990.
That was revealed last night as the Liberal Democrats called for a review of separate legislation which has permitted severance payments totalling nearly pounds 200,000 to a series of Cabinet ministers who have resigned or been sacked since 1991.
John Major announced in March 1991 that all former prime ministers were eligible for an extra payment, which was equivalent to the sum all MPs receive to cover secretarial and office expenses.
At the time it was said in Whitehall that Lady Thatcher - who did not draw her full salary as Prime Minister - had not asked for the increase and it was suggested that the payment had been made on Mr Major's initiative. But an authoritative Westminster source said last night that she had taken up the issue herself with the Commons Fees Office in the early spring of 1991.
The source said that at a meeting with James Dobson, then the accountant of the House of Commons, she personally raised the fact that her MP's salary and allowance did not provide enough help with the huge volume of correspondence and business that she had to handle as a former prime minister. Mr Dobson is said to have told Lady Thatcher - to her dismay - that he had no authority to make any extra payments.
There then followed a series of negotiations involving Sir Robin Butler, the Cabinet Secretary, the Cabinet Office and the Commons authorities, …