Mr Major’s Comments on the Economy (I) – 22 April 1993

Below is the text of Mr Major’s comments on the economy, made during an interview held in London on Thursday 22nd April 1993.

QUESTION:

[Mr Major was asked if the recession was over].

PRIME MINISTER:

I think there is a great deal more confidence among business, I think it is they who by their performance will show whether the recovery is with us. There is no doubt they are very confident indeed now and many of the indicators over recent weeks have been very positive, so that is very satisfactory.

QUESTION:

[Mr Major was asked if he wasn’t prepared to say that the recession was over].

PRIME MINISTER:

When the recession is over everyone will see that self-evidently. What I think one can see is happening, there is a much greater degree of confidence, exports are rising, one has seen with car sales and a whole range of other indicators that they are getting a good deal better. I want to see those indicators go on getting better, that has been happening in recent weeks, it is very welcome news.

QUESTION:

[Mr Major was asked how people knew that the recovery wouldn’t lead to Lawson type boom].

PRIME MINISTER:

I think that is exactly the right question that people should have in their minds and exactly the right concern that I have in my mind. We said two years ago that there was no short cut out of the difficulties we faced. I said that it would be a difficult period, we had to get inflation down, when we had got inflation down – and I knew it would be difficult, knew it would be unpopular – then we would begin to see recovery.

We have got inflation down, we are beginning now to see the recovery, I think that is self-evident from what businesses themselves are saying. I have not lost my concern about inflation, I had it two years ago, I have it now, I want to make sure this is a long term sustainable recovery, not a short term boom.

QUESTION:

[Mr Major was asked if the recovery was a candy-floss recovery with no recovery in manufacturing].

PRIME MINISTER:

There has been a great degree of retraining but let us look at more substantive matters of what is actually happening. You refer to a candy-floss economy. The reality is the fact that our exports, a key element in continuing economic recovery, are now penetrating very deeply into both European and markets way beyond Europe. That export growth is at record levels, it is continuing, and that shows several things, that British firms are manufacturing, that they are competitive, that they are prepared to look for markets abroad and that they are successfully doing so. All that is very welcome. The unemployment drop is very welcome, I am delighted about that, most for the unemployed who have found jobs and for their families, but the level is still too high, we need to see a much wider manufacturing base, I shall be talking about that in the next few days and I wish to see that we have the right circumstances to engender confidence so that business can produce the growth we need. Governments cannot do it, they can set the framework, then business can do it, that is what we are seeking to do.