Mr Major’s Speech Marking 25th Anniversary of Carparo – 11 February 1994

Below is the text of Mr Major’s speech at a lunch to celebrate the 25th anniversary of Carparo.

PRIME MINISTER:

Ladies and Gentlemen, I am delighted to be here today as a guest in my own constituency on this very special occasion of the 25th anniversary of Carparo. It has during the last hour and a half or so provided the odd surprise or two. When I heard a motion from the House of Commons, or at least a message from the House of Commons. I have to confess to you, for a fleeting second there was a twinge of concern. I cannot think for the life of me why this should be, but it most certainly was. But it is a rare event to have a motion of that sort. Rare, but I think justified because the motion referred not only to the contribution of Dr Paul, not only to the remarkable success of Carparo, but it also referred to the success of a British manufacturing enterprise and I was delighted to have that motion put down by colleagues from more than one party in the House of Commons.

Before I turn to other matters can I just say how pleased I am personally to see the High Commissioner, Dr Sindha. He is, in my own experience, and I think in the judgement of many better judges than I of these matters, an outstanding High Commissioner who served India’s interest with great skill. But in doing so remains a very close friend to this country as well and I am delighted to see him here today. What a remarkable achievement, to have built Carparo up in such a time, on such a scale, across such a wide range of different activities. When I heard that motion about the British manufacturing industry, what came immediately to my mind was this thought – too often in this country we underestimate what can be done in this country and what is done. As I go around the country and see what is actually happening in manufacturing and non-manufacturing enterprises alike. I see stories of success, of innovation, of skill, of far-sighted judgement -of which we hear far too little in this country. We hear the bad news so frequently. It would be of more use to all of us – in industry, commerce and private citizens alike, if we were to hear a little more of the remarkable successes of so much of the British manufacturing industry.

I have taken the opportunity in the last few weeks and I will return to this in a few moments, of going around the country, having a look at some of these remarkable examples of success, and I propose to do that again in the future. Because the success that Dr Paul has achieved, is a remarkable example of what can be achieved by hard work and enterprise. The success of Carparo is symbolic of what is happening in a large part of the British manufacturing industry more generally, and I’d just like to say this about manufacturing. There is more than one school of thought about manufacturing. There is a school of thought that regards it almost as marginal to the success of British industry, and there is a second school of thought that regards it as fundamental to the success of British industry. I take my stand with the second school of thought. I don’t regard manufacturing as a Cinderella part of British industry. Making things matters in this country and we must make it clear to everyone that all of us believe that making things matters. It has changed manufacturing. Changed in a remarkable way. Both in image and content, over the last 20 years or so. What we need in manufacturing is more of the best brains, the best skills, that our young people can produce. We need to build up those skills. We need to change the culture in this country, in the way in which typically we look at the manufacturing industry specifically and commerce more generally.

I saw with some interest, just a day or so ago, a remarkable survey published by the CBI and I’m delighted to see Howard Davies, the Director General with us this afternoon. It was a survey of a wide ranging series of aspects of manufacturing. It showed manufacturing orders rising strongly, right across the United Kingdom. It showed business optimism increasing. It showed companies expecting output and demand to rise. Business optimism, at its highest level for 4 years. Orders up, exports up, exports even up in difficult markets as an increasingly competitive British industry penetrates even markets currently in recession on the continent and elsewhere. It showed costs under control, unit labour costs down over the last 12 months, and for the first time since the recovery slowly and painfully began in June, getting on for nearly 2 years ago, 20 months ago now. We began to see more companies expecting to increase investment over the next year, with engineering perhaps doing particularly well. That was from the industrial trends survey, which over the last 30 years has perhaps shown itself to be the most reliable indicator of what is going to happen in our economy. The prospects for the future look even brighter and for those who believe that the tax changes will perhaps put a break upon the recovery, as Howard Davies said just a few days ago, looking, and I quote directly, looking at the experience of previous tax increases in the late ’60s, the early ’70s and the early ’80s, that shows that tax increases will not halt the recovery. The key is confidence and we should not talk ourselves into pessimism which is not justified by the facts. I believe that is absolutely and entirely right. Because potentially at the moment, if you look across the range of economic indicators and the increasing competitiveness that British and commerce, we have potentially, the best circumstances for sustained growth with low inflation that we have known in this country for very many years.

I have taken the opportunity of escaping from that Whitehall/Westminster nexus to go and look out in the real world at some of the things that are happening. Earlier this week in the East Midlands, I visited Triumph Motorcycles. Not all that long ago within the memory of everyone, every adult in this room, the British motorcycle industry just ceased to exist. They disappeared. An attempt to revive it as a cooperative failed. It seemed that another industry had fled the country and gone for good. But now Triumph have brought it back. Substantial capital investment and training is now growing and exporting to Japan, to Canada, to Germany, to New Zealand and to countries all around the world. A week earlier, in Yorkshire, to see in the textile industry Firth Carpets, again an industry that many people thought were in real difficulties and yet now, after suitable investment and good management, it’s competing with the best in the world and will take the advantages that spring from some of the changes in the Uruguay Round. The week before that, at Perkins Engines in Peterborough, another area where success for the future seems to be guaranteed and today of course, the truly remarkable success story of Carparo.

Our host referred earlier to our joint date with destiny in 1968. I was elected to Lambeth Council and ended up here today, he had £5,000 and ended up where he is today. If only I’d had £5,000. In 1968, the success of the company is of course the stuff of dreams. But not only dreams, hard work, skill, aptitude, risk, application and yes luck, are the ingredients that have helped make the company what it is today.

Perhaps a talisman of some of the other changes that have taken place. What I passionately believe is that at the moment people simply do not realise the transformation that is taking place in the British economy and it’s vital that they do so that they take the opportunities that that transformation is about to offer. We are in this country, frankly, not very good at talking about our successes. We should be. Because success will breed further success. It will breed confidence, it will breed investment, it will breed growth, it will breed tax revenue, it will breed jobs and it will breed a better quality of services that the tax yields that follow will enable us to fund.

People abroad can recognise our successes and the changed climate. Why else would so much external investment from the European Community, from Japan and America, be coming to this country. Because they have seen the change with their perspective from abroad in the way that so many of us in this country have not yet recognised it. They know the opportunities here. They know what can be done by the right sort of investment over the long term in the United Kingdom economy and increasingly we should recognise it ourselves in this country. We should be more self-confident. We should say more about our successes and I hope we will. Exports at an all time high and Carparo playing its own part as a previous winner of the Queen’s Award for Export Achievement.

We still have in the United Kingdom some of the best and some of the biggest companies in Europe. 14 United Kingdom firms in the top 25 in Europe. That inward investment I referred to from Japan, the United States and elsewhere. These companies don’t come here for the weather, they come here for the business climate. The low taxation climate, in terms of business. The increasing aptitude and willingness of people to seek skill training and I wish to turn to that in a moment. The number of companies moving from Europe to the United Kingdom. Black and Decker of course being a recent example, not just inward investment, but companies bringing their whole enterprise to actually establish it here in the United Kingdom and they come because the conditions are right. I wonder how many people in this room can last remember when we had inflation around 2 per cent for a full year. Certainly not since 1960. With interest rates at the lowest level since the mid-1970s, with productivity improved, with manufacturing output up, with unemployment having fallen in 9 months out of 11, while alas in so many of our competitive countries in Europe, it’s still rising sharply and with industrial relations wholly transformed. If I had stood here 12 years ago and said to you that we would have at the present time, the lowest number of days lost to strikes since records began and a relatively clement industrial relations attitude between workforce and management that exists in this country today, frankly most of you would not have believed that it would be possible. But it’s happened and it is of vital interest to manufacturing industry.

But there is one other change that I wish to refer to and it relates particularly to industry. There is an artificial cultural distinction between blue collar and white collar workers that has existed in this country for too long and has done too great a damage over too long a period. We do need those people who work in industry to have the esteem they deserve and those artificial distinctions between blue and white collar workers are outdated, absurd, damaging and they should be put in the dustbin immediately and never taken out again. What we need, if we are to have the success in the future that I believe this country is capable of, that is going to be built on the right macro economic structure created by government and the right investment and vision undertaken by business. If we’re to achieve that, not just this year, next year, the year after, not just in good years but in difficult economic years as well, then we need to attract more of our brightest and best brains into industry.

The world is more competitive today that it has ever been. It is going to get more competitive. We’re not just competing with our friends and colleagues in the European Union, in France and Germany and Portugal and Spain. The competition comes also and here we must gear our competitive structure to meet it. The competition comes the Pacific Basin, from Japan, from the United States and unless we lift our eyes to make sure we can compete with those countries, then we will not remotely begin to achieve the success that is necessary in the future. That is why we need to keep our industrial costs down. That’s in a nutshell, why I myself thought it wrong to accept the provisions of the Social Chapter and decline to agree it in the Maastricht Treaty negotiations. That is why I myself believe that we must do all we possibly can to reskill Britain in manual skills of all sorts. We do need those skills to meet that more competitive world that lives out there, which you as businessmen must compete. We need more apprenticeships. We need to see the increasing thrust of our young people going into higher education. We had a target of one in three of our young people getting into further and higher education by the turn of the century and we have achieved that target this year, six years ahead of schedule. We need that to continue. We need to put an increasing weight and interest and acknowledgement of vocational qualifications of one sort or another. This is a revolution. A revolution in culture, a revolution in business management, a revolution in thought, about the way in which we look at business and industry.

Those days will, within my political lifetime. But every shred of profit was looked at enviously are surely regarded as absurd by the overwhelming majority of people in this country today. Business itself is willingly accepting more and more social obligations of one sort or another. The generous donation to London Zoo by Carparo and the generous donation to some of the charities Norma works for today is an illustration of that. It stretches right across business, free enterprise, profitable, in increasingly accepting the obligation to assist in sponsorship of arts and other charities and good causes of one sort or another. The old artificial division that existed so many years ago, of hostility for private enterprise, has been steadily draining away over the last 15 or 20 years and in that climate we have to recognise what the underlying philosophy for the future must be. It is a perfectly simple philosophy. If business wins, Britain wins and we need to gear our policies to provide business with the greatest possible opportunity of winning. Business of course has the primary role. Government must provide the right macro economic climate. It can help in other ways. Help with exporters, help with export credit, help with taking trade missions abroad to use political clout to open the doors to businessmen to secure their deals. That is something that I believe is a legitimate responsibility of business and increasingly we will do that and we will use our Embassies and High Commissions abroad to promote the interests of British business. That is in all our interests in this country.

Carparo has illustrated much of that. Carparo is winning. In many ways has won. Could move from a company with £500 to the multi-million pound concern with interests all around the world that it is today is a truly remarkable success story in private enterprise. I’d like to extend my congratulations to Sir Raj Paul and all his colleagues who have contributed to that success.

A few moments ago at the conclusion of these remarks, our host invited everyone in Carparo to rise and drink a toast to their guest today. I, for my part if I may, would like to return the compliment. We’re here to celebrate the 25th anniversary of a success story well worth celebrating. I would like to conclude by inviting all the guests to join me in a toast to Sirraj Paul and all who have made Carparo such a remarkable success story.

Dr Paul and Carparo.