The PR supremo, Lord Bell, believes Saatchi & Saatchi's iconic 1979 "Labour isn't working" ad rattled the party so much it cost them the election.
In an interview published today, Lord Bell, who is credited with helping Lady Thatcher into power, says the Labour government's decision to put off a general election after the poster came out proved a disastrous mistake for the party.
The delay meant Labour was forced to call the election during the "winter of discontent".
But Lord Bell reveals the image used in controversial poster was, in fact, a fake.
The supposed dole queue in the ad was, in fact, a group of Young Conservatives from Hendon, who were asked to participate in the shoot.
Because only about 20 people turned up, Saatchis had to reproduce images of the same people to create the impression of a snaking queue.
"No-one realised it wasn't a complete queue," says Lord Bell, adding: "An early example of retouching. Very sophisticated at the time!"
In the article, published in the latest issue of advertising agency J. Walter Thompson's magazine Out of the Blue, Lord Bell describes Lady Thatcher as the best client he has ever worked for - but adds he got "well and truly handbagged" if he ever tried to influence policy.
"You do better work if you have conviction," he says.
"When we [his Bell Pottinger PR firm] worked for the National Party in South Africa in 1994, it was easy because they were the ones that had actually dismantled apartheid and I admired that. But we were attacked for it, accused of being fascist bastards and so on."
Lord Bell ran the Conservative party's account at Saatchi & Saatchi when the agency produced its "Labour isn't working" poster, which si one of the most famous British adverts ever produced.
"I think we only spent about £100,000 on the whole campaign, including media," he says.
"The campaign only took off when the papers and the Labour deputy leader Denis Healey commented on it... I reckon we got about £14m worth of coverage out of that campaign."
Lord Bell says he believes the separation between politics and business should be "an abyss".
"Business should impact on politics but not the other way around," he says. "In the main, our corporate system works very well."
Lord Bell, who chairs one of the UK's biggest marketing services groups - Chime Communications - also attacks the UK's attitude to business.
"The way we persecute companies at the moment in the UK is madness," he says.
"Look at Gerald Corbett at Railtrack. Now Railtrack have lost a boss and the business is severely damaged."
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