Phyllida Lloyd's film about Margaret Thatcher, The Iron Lady, is an ambitious project. It aims high and is almost, but not quite, a masterpiece. It was daring to portray the career of a politician simply in terms of the joys and sadnesses that return to the troubled mind of an old lady in uncertain health. At frequent intervals, we are confronted by a memorable close-up of the haggard, yet still beautiful, face of a woman haunted by emotions of the past, both of triumph and of sadness. The portrayal of Thatcher is a remarkable piece of acting by Meryl Streep. She has captured the voice and much of the personality that once dominated Britain.

Thatcher's public emotions in the film are predictable. They are accompanied by private emotions at which we, and indeed the film-makers, can only guess. Much of this is very poignant - for instance, when Thatcher asks her daughter to invite Mark to slip upstairs to say goodnight, Carol has to remind her mother that Mark now lives in Los Angeles. A little later Mark telephones across the Atlantic to postpone a planned visit to England. His mother receives the news bravely and tells him not to worry about the delay; but as she puts the phone down she wipes away a tear.

In five or ten years this may be acceptable and may be admired as entertainment, but today things are different. Lady Thatcher is still alive. Even if she does not see the film she will meet dozens of people whose view of her will be shaped or reshaped by it. The very skill of the film makes it a ghoulish spectacle.

We understand again how inadequate film is in portraying public events. Any attempt at biography or autobiography will set our own imaginations to work and bring to the surface thoughts and sentiments that are outside the range of the cinema. The Iron Lady makes a competent survey of a few events of Thatcher's premiership - such as the Falklands war and the miners' strike - but it leaves out much that is crucial to any understanding of the whole. There is no mention of the Westland affair, which, to me at least, exposed the weakness of her style of government and underlined the need to return to collective, cabinet government, as opposed to decisions born out of conversations between individual ministers and the prime minister.

Thatcher operated a radial system with herself at the centre of the wheel. This could only work with trust between all concerned, and by 1986 trust had been allowed to atrophy. She tried to handle the clash over helicopter policy between Michael Heseltine and Leon Brittan herself, and failed.

For a few days Thatcher had to revive collective government in order to extricate herself from the dilemma created by Heseltine's resignation. Senior ministers met at 12 Downing Street and the prime minister waited upstairs while we drafted a statement that we judged was necessary for her to deliver in the Commons that afternoon. For a day or two, I really thought that Westland had been a turning point, and that we would be able to build a better, more consensual system of government out of that experience.

I was wrong. The prime minister reasserted her authority over the system. One consequence was the election victory of 1987. Another was the poll tax.

Nor does the film analyse in any depth the curious way in which the prime minister made overseas policy. There developed a rhythm with which her colleagues became familiar. She might well hold a strong view about a subject that a meeting was summoned to discuss. She would express this view in cabinet, where it would be translated into working language. At the meeting, she would carry herself with dignity and not wander too far from her brief.

Afterwards she would give a press conference or make a statement in the House of Commons. It was then that the damage was done. Phrases, maybe the discarded first draft of a speech, crowded back into her mind under questioning. These remarks would surface, whereas
the carefully crafted points prepared for her would be forgotten. She would launch into a passionate outburst that reflected her own
initial instincts. The media, of course, would be delighted and urge her on. The press con­ference after her discussions with Garret Fitz­Gerald on Ireland and her press conferences after European summits illustrated this process. They gave pleasure to the media - indeed, to everyone except the ministers or officials who found themselves forlornly expounding a policy that had been swept aside by the spate of the prime minister's rhetoric.

These moments of high drama were exceptional. Usually, after argument, she allowed her head to prevail. She accepted the agreement on Rhodesia; she signed the Anglo-Irish Agreement; she agreed to the Single European Act of 1986, with its substantial concession on qualified majority voting. She consented in the end to German reunification and to her chancellor and foreign secretary agreeing to Britain entering the Exchange Rate Mechanism. She accepted an outcome on Britain's European rebate which she had at first criticised as inadequate. On all these matters, there were negative voices urging rejection which found an echo in her own heart. On some of them she changed her mind back again, and in her memoirs regretted her decision; but in all of them she served the British interest when she agreed to make a deal.

Each of us who worked with Margaret Thatcher carries away his or her store of memories out of which we put together our own portrait. These portraits will differ greatly. She had a small group of individuals who shared her underlying views about such matters as the money supply, the nature of poverty in Britain, the evil of communism and the dangerous characteristics of the German people. When these subjects came up, the existence of this common ground made it unnecessary to discuss first principles, because these were fundamental within the group. I was never a member of this group, never "one of us", and did not particularly want to be. I preferred to stick to my own brand of Conservatism, which is simpler and more traditional.

However, I soon discovered that this did not cut me off from communication with the leader. I went with her on her first visits to China and Japan in 1977 and to the Gulf in 1981, and soon found that she was glad to talk freely during these occasions, if only because I was the sole colleague within earshot. (In China, I had to play exactly the opposite role to the one that had been necessary with Ted Heath three years earlier. With Ted, I was constantly having to dampen his enthusiasm, whereas with Margaret I had to kindle the rare acknow­ledgements that, behind all the exaggeration, the People's Republic, without question, had achieved some successes.)

I was thus able to make my own assessment of her impact during these overseas visits and of the undoubted benefit they brought to the standing of Britain in the world. Like Disraeli, she believed that prestige was the best measurement of that standing and that it was her duty, and the duty of all Her Majesty's ambassadors, to build up this prestige in every possible way. In her account, the Falklands war and the negotiation of the British rebate in the European Union were broadly equivalent to Disraeli's purchase of the Suez Canal shares and his proclamation of Victoria as empress of India. Party opponents might mock these as somehow lacking in substance; but they were the currency in which the world handled its affairs and the world was certainly impressed by Margaret Thatcher.

There was a corresponding achievement at home. It is hard now to recall the almost total gloom that had descended on the country in the mid-1970s. Heath's government had been swept out of existence by trade union power. It seemed that, regardless of how the British people voted in any election, the actual levers of power were in the hands of the unions, which used their strength with remarkable disregard for the realities of the 20th century. Yet it seemed impossible before 1979, and after Heath's election defeats in 1974, to imagine anyone coming forward with a programme that would lift this burden from our shoulders. Margaret Thatcher achieved this, not with a single legislative act on US lines, but by slowly sapping away the foundations of trade union power, and then sealing her success with her handling of the miners' strike.

I kept a diary every night in government and scribbled in it the emotions of the moment. These were often dominated by exasperation
at the prime minister, in particular at her working methods and her occasional lapses into what I saw as foolishness. Her ways were not my ways, but they seemed to be working and I was glad. I remained solidly behind Thatcher throughout those last days of 1990. I disliked the sycophancy of her last party conference as prime minister, yet I had no difficulty in nominating her for re-election as our leader and repeating that nomination after the inconclusive first ballot.

The Iron Lady ends with an accurate account of the banquet at Versailles given on 20 Nov­ember 1990 by President François Mitterrand. Thatcher had just heard the disappointing result of the first ballot in London which failed to give her a decisive majority over her challenger for the leadership of the Conservative Party, Michael Heseltine. She arrived late for the occasion, and all eyes were upon her. She looked superb and carried herself, as always, with great dignity. The banquet, which was held in the Galerie des Glaces, seemed to go on for ever, and the prime minister must have been longing for her bed. I felt particularly proud of her that night. The next day we flew back to London and she set about cross-examining the members of the cabinet on their views. As a result, she decided to resign. It was, as they say, the end of an era.

Douglas Hurd served in Margaret Thatcher's cabinet from 1984-1990

“The Iron Lady" (12A) is on general release in UK cinemas from 6 January