The Alliance Party leader “quite openly” told an NIO official that the salaries being paid to his party’s Assembly members were the only thing that kept the party in existence.
Alliance leader John Cushnahan met RS Reeve in the NIO’s Political Affairs Division in August 1985.
Mr Reeve’s note of their discussion recorded: “I had lunch yesterday with a very gloomy and depressed John Cushnahan.
“After his family holiday in the USA, he was finding it increasingly difficult to revive any interest in Northern Ireland politics - the more so because of the extremist out-bursts of unionist politicians.”
It went on: “Cushnahan was obsessed with the future of the Assembly. He was quite open in saying that the salaries paid to Assembly members were the only thing which kept his party in being. If the Assembly were to disappear then the majority of the Alliance leadership group would leave politics.
“Cushnahan himself kept saying that he would be happier going back to teaching and it would give his family a security they currently did not enjoy.”
The note added: “On the unionist side, Cushnahan said that we ought to be concerned about the growing influence of the UDA.
“A number of prominent unionist politicians (he quoted Robinson, Beggs, McCusker and Ross) were coming increasingly under the influence of loyalist paramilitaries and although Mr Molyneaux was keeping himself well apart he was making little attempt to discourage other leading members of the UUP from opening up contacts with the likes of Tyrie and McMichael.
“It was interesting that the UDA were not putting up offers to Dr Paisley. The paramilitaries distrusted Paisley because of the way in which he had misled them on previous occasions.
“They were therefore tending to concentrate more on Robinson and Sammy Wilson who they saw as the future leaders of the DUP.”
It is not mentioned in the file, but the following year the Assembly was dissolved and, partly for financial reasons, Mr Cushnahan stepped down as leader and was succeeded by John Alderdice.
Mr Cushnahan made a return to political life in 1989 when he stood for Fine Gael in Munster in the European election, winning a seat which he held until his retirement in 2004.