Mr Major’s Parliamentary Answer on the CBI – 4 May 1989

Below is the text of Mr Major’s response on the CBI, made on 4th May 1989 in the House of Commons.

Mr. Cran To ask the Chancellor of the Exchequer when he next intends to meet the director general of the Confederation of British Industry; and what will be discussed.

Mr. Major My right hon. Friend meets the director general of the CBI from time to time, and a wide range of matters are discussed.

Mr. Cran Does not my right hon. Friend agree that British management must continue to resist excessive wage claims such as we are beginning to see, if for no other reason than the need to continue to improve our international competitiveness? Does he agree, further, that management must show leadership and ensure also that their own snouts are not too deeply in the pay trough?

Mr. Major I am not sure that I would put the second part of my hon. Friend’s question in precisely that way, but I certainly agree with the underlying sentiment. I do not defend unjustifiably high salary increases, whether for directors or for the work force. That should be clear. On his substantive point, there must be a clear danger to industry and competitiveness if wage costs outstrip productivity growth. It is an important function of management to make sure that they do not.

Mr. Robert Sheldon When the right hon. Gentleman meets the director general, will he explain to him something that he himself seems to be reluctant to accept – that is, how he hopes to reduce the balance of payments to a reasonable level with a high pound and high interest rates?

Mr. Major I am bound to say to the right hon. Gentleman, in terms of the strength of sterling, that it is a matter of record that some of the countries with the strongest exchange rates over a lengthy period – Japan springs immediately to mind – have an extremely good exporting performance.

Mr. Jack When my right hon. Friend next meets the CBI, will he discuss the encouraging trends towards higher levels of exports from the United Kingdom? Will he give industry every assistance to increase the amount and value of our exports?

Mr. Major We are certainly delighted to see the increasing trend in exports. We wish that to continue. The most important thing that we can do for industry, whether in regard to exports or internal sales, is to get firm control of inflation. That is central to our policy.

Mrs. Fyfe When the Minister next meets the director general of the CBI, will he place on the agenda the concern of the Equal Opportunities Commission about the taxation of workplace nurseries? Will he further tell the tigress that her cubs were better looked after than the vast majority of working women’s children are after 10 years of the tigress being at No. 10?

Mr. Major That may well be a matter that the director general would wish to discuss. I shall bear the hon. Lady’s comments in mind.