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Michael Heseltine: We did the right thing for Liverpool

30 December 2011 Last updated at 13:34 GMT

Margaret Thatcher was urged to abandon Liverpool to "managed decline" by her chancellor, newly-released National Archives files have revealed.

The confidential government documents, made available under the 30-year rule, reveal Cabinet discussions following the 1981 Toxteth riots.

While ministers, such as the then Secretary of State for the Environment Michael Heseltine, were arguing for regeneration funding to rebuild the riot-hit communities, Sir Geoffrey Howe thought it would be a waste of money, warning Mrs Thatcher "not to over commit scarce resources to Liverpool".

Speaking to the BBC, Lord Heseltine said the documents should not be used to judge decisions made decades ago.