Tag: Economy

  • Mr Major’s Press Conference in Tokyo – 9 July 1993

    Below is the text of Mr Major’s press conference, held in Tokyo on Friday 9th July 1993.


    PRIME MINISTER:

    I think this week we have had a productive meeting in Tokyo. To be frank, the results are better than I anticipated when I came and better I think than most people expected. Let me just touch very briefly on the main issues without repeating the communiques and then open up the floor to the questions that you may have.

    I think on the market access package it is clearly a significant step, it does mean that we are now open to return the talks back to Geneva on a multilateral basis, there is still a great deal to be done, I do not hide that from anyone, but I think it does reopen a realistic possibility of a satisfactory outcome towards the end of this year. I think people often tend to forget how much wider these particular trade talks are than any we have seen before. That does correspondingly mean the prize of them being successful is that much greater, though the price potentially to be paid, were we to fail to reach an agreement, is also one I hope that will provide a substantial impetus for everyone to make whatever sacrifices may be necessary to ensure we get a satisfactory outcome.

    I think this summit has acted as a catalyst, it was always likely that it would and I am delighted that that is how it turned out.

    If I could just say a word about the economic discussions we had and the economic communique. The underlying message I think is quite clear, we need to break down the barriers to growth and the barriers to jobs, that was a theme in the discussions the European Community had at Copenhagen, it has been echoed very satisfactorily here in Tokyo this week.

    With the exception of Japan, all of the countries represented here have very substantial budget deficits, bigger than is desirable I think in every case. We spent some time discussing that, I think there is a recognition that those deficits need to be reduced and that all of us need to keep social costs within the bounds of what we can afford. This is not just a particular problem in the United Kingdom, it is a problem that it was evident in the discussions is felt right across the G7. It will mean difficult decisions I suspect in each of those countries but they are decisions that are going to be necessary. Provided people understand what lies behind them and what the impact of them will be, I think people would prefer those home truths rather than empty promises.

    On the summit itself, we have had some useful innovations this year and I would like to congratulate Prime Minister Miyazawa upon them. It has had rather less pomp than we have sometimes been accustomed to on these occasions and I certainly welcome the fact that that is the case. We will have even less pomp, I trust, in future.

    I made further proposals for reshaping the summit process, they have been accepted, most of them, and we are proposing to make it a good deal more informal in future, there will be much less time preparing documents, much more time in really frank and informal discussion between the Heads of Government. I think that is welcome, it may be there are yet more reforms to be made and perhaps we will see how next year’s meeting in Naples goes before returning afresh to that particular matter.

    On the political declaration, we spent some time on Bosnia and non-proliferation and I think there is a very satisfactory statement there. We agreed that Iran, Iraq and Libya all pose serious problems for the international community. I was delighted at the backing for constitutional talks in South Africa and returned to a theme I have mentioned before, the desirability of lifting sanctions on South Africa soon to give them access to the international financial institutions. They still have a birth rate growth of around 3 percent, no economic growth at all, and the impact of that combination of factors is very damaging indeed for many millions of the poorest of people in South Africa.

    On Russia we have a substantial meeting this afternoon with President Yeltsin. I met him over breakfast, he certainly was very relaxed and in very good form. He feels he is making good progress in reshaping the political system, he understands there is still a substantial way to go to complete the new draft constitution and convene new parliamentary elections. But there is no doubt he is a good deal more confident about matters after his remarkable referendum victory some while ago.

    We talked about arrangements for stepping up Russia’s political dialogue both with the European Community and with the seven summit countries. At Copenhagen a week or so ago I sought and obtained the agreement of our European Community partners for twice yearly bilateral summits with President Yeltsin, I think he was very pleased with that, certainly he proposes to take up that particular offer. And I suggested this morning that we should this afternoon invite President Yeltsin to join us in Naples next year at the end of the formal G7 for a further G7 plus 1 discussion on the same basis as this year and that offer will be made to President Yeltsin this afternoon and I have no doubt he will accept it.

    We spent some time on free trade, some time on other matters that perhaps I will raise only in questions if you invite me to do so. We have agreed a substantial new programme to help privatisation in Russia, it amounts to 3 billion, it is a privatisation and restructuring programme and I think that will be very well received this afternoon.

    One matter I raised that is not in the communique, I raised it at a late stage but it is not necessarily a matter for the communique, is a letter that all of the participants at the summit have had from Mr Shevardnadze. The position in Georgia is desperate, not just the war but very dire humanitarian problems as well. I think we do need to encourage both Russia and Georgia. with United Nations support, to have yet another look at finding a solution to the problems of Adhardzia [phon], it is important they do so, it would open up the way for the despatch of United Nations observers. Firstly there is the question of trying to mitigate the fighting, but there is also the question of a severe danger of starvation and a dramatic lack of medical and other equipment in Georgia. I raised that this morning, I now think it is probable that the European Community and others will be despatching some assistance to Georgia fairly speedily, I have no doubt myself that that is badly needed.

    Just finally, if I may, a word about the bilateral relationship with Japan. The Japanese government have invited me to return in September for a bilateral visit. We are keen to enhance our political relationship with Japan, it is in very good shape now, it has been improving dramatically over recent years, we have thriving trade, I think that is going to be boosted by the removal of the tariff on Scotch whisky, there are internal tariffs as well, perhaps they also may decline over time. British and Japanese companies have been working together in projects in a number of companies. When I come back to Tokyo in September I propose to bring with me a mission of very senior businessmen and leaders of high technology companies, that will be led by Michael Perry of Unilever but there will be a number of other very high profile British businessmen with me as well.

    QUESTIONS AND ANSWERS

    QUESTION (George Jones, Daily Telegraph):

    Prime Minister, the summit declaration includes a commitment to reform the United Nations, are you now prepared to see Japan and possibly Germany as permanent members of the Security Council?

    PRIME MINISTER:

    I welcome the debate on the Security Council reform and we fed in our comments to the Secretary General of the UN. I am happy to make the position entirely clear. We are certainly not against change either in the UN or in the Security Council. What the debate is about is about enlarging the membership of the Security Council, including its permanent membership. The permanent membership of any member, including the United Kingdom, is not of course in question. The main concern that we have is to maintain the effectiveness of the working of the Council. It has over the past 2 or 3 years been working with, I think most people would say, an unprecedented degree of consensus, nobody wants to damage that, to enable the Council to respond satisfactorily to a whole range of regional crises — Kuwait, self-evidently, Cambodia, Somalia, Bosnia – and nobody wishes to damage that degree of consensus. That said, it is going to be a difficult debate. There are many aspirants who would like a permanent seat, agreement will be difficult to reach and particularly difficult if we are to reach it without damaging the work that the Council does.

    I think that debate should take place, I welcome that. There are a number of countries who by virtue of their global interests, you have mentioned Germany, you have mentioned Japan, by virtue of their global interests, their contributions to international security, that will be interested in seeking a permanent seat. That carries with it obligations, peace keeping of course is one obligation that it will tend to carry with it. I am very pleased to see the steps being taken in Germany to amend the constitution, that would allow full German participation. I welcome the statement by the Japanese that they are prepared to do all they can to discharge their obligations to the Security Council. Now if agreement can be reached on these points, I suspect those countries could be among the beneficiaries of reform but it would have to be on the basis of their playing a full part in Security Council activities, including peace keeping.

    So the simple straightforward answer is I am certainly not opposed to reform, I think it has to be the right reform and it has to be on the right basis. That debate has started, I think it will go on for some time, but I welcome it.

    QUESTION (Peter Jay, BBC):

    If there had been no Economic Summit, what difference would that have made to the ordinary man and woman in the street, apart from saving the Japanese taxpayer a lot of money?

    PRIME MINISTER:

    I am not here to speak for the Japanese taxpayer, I have enough trouble with my own taxpayers, I will leave others to speak for that. I think the catalytic effect of this meeting on the trade talks was clearly very important. I think also the degree to which it clarified international problems, the deficit is one I would stress most obviously, was also very useful. But also it clarified the contribution collectively that the participants can make to restoring some measure of growth across the world economy.

    If I could pick out the points of emphasis: agreement in Japan to the need for fiscal stimulus to improve Japanese demand, I think that will be very helpful; the reiteration by the United States of dealing with their fiscal deficit is a substantial contribution that they can make; and in Europe of course the renewed commitment by the Europeans collectively that there is a need for a decline in the present level of interest rates. I think the combination of those factors, brought together so that everyone can see the extent to which they interlink in restoring confidence and growth of the world economy, is very useful.

    So the word I would offer, if you wanted a single word, would be jobs, because 7 think it is the combination of those factors that restores confidence, will I trust restore growth, and with it, although there is not an umbilical relationship between growth and jobs, we are not going to get: jobs without growth. Providing we get growth we will have continued investment and I hope we will be able to take some of the 23 million G7 unemployed citizens off that list of being unemployed and back into work.

    QUESTION (Financial Times):

    Prime Minister, can you please tell us what you discussed with Mr. Yeltsin as far as trade access is concerned and also can you tell us how much of the privatisation package is actually new money and also how much of it is going to be equity rather than loans?

    PRIME MINISTER:

    I think we will set out the details of the privatisation package after we have given it to President Yeltsin and discussed it with him this afternoon. It is a mixture of redirecting existing resources and new money – it is a mixture of the two.

    On the trade aspect, we did spend some time talking about trade this morning. The objective, not obtainable in the short-term, must be free trade between Russia and the rest of the world. We would like to see Russia join the GATT – I think that also is an objective we have. The Chancellor of the Exchequer joined me for the breakfast with President Yeltsin and as we made clear this morning, the restructuring of the Russian economy has some way to go before we can make free trade a reality.

    Free trade imposes obligations on Russia as well as advantages for Russia. They would certainly need to remove some of the quite extraordinary subsidies they have in many parts of their industry. President Yeltsin accepted that; that is the direction in which he wishes to go. As he begins to make moves on subsidies, I hope the western countries generally will begin to increasingly open their markets and move towards a completely free trade option. What clearly is patently silly over time is for the West to continue to provide financial resources to Russia whilst at the same time closing their markets to Russian exports which would enable them to diminish their need for those same financial. resources.

    I found it a very productive discussion. President Yeltsin invited me to go back to Russia – we are looking at dates – and one of the issues we will certainly discuss then is trade.

    QUESTION (Japanese Newspaper):

    Could you tell me why you are so eager to reform the summit? Secondly, when you met Mr. Myazawa, when you promised to come to Japan again, did you say that he was going to see you again?

    PRIME MINISTER:

    I look forward to seeing him again. I have seen him many times in the past, I look forward to seeing him many times in the future.
    Why reform the summit? At its simplest, because it is far too bureaucratic. It is too bureaucratic, it is too pre-cooked.

    There are several advantages in a summit like this – some of them are tangible, some of them are less tangible. The tangible results are some of the things I was talking about a few minutes ago and I won’t reiterate that. The intangible advantage of a summit is the extent to which the leaders of the industrialised nations get to know one another much better. When there is a problem, when there is a crisis, it is much easier to be able to pick up the phone and talk to someone you know, you have met, you trust, whose mind processes you understand. Also I think the informality of discussions – we had a very informal discussion over dinner on the first evening, very informal, very wide-ranging and I think everyone learned a great about all the other participants as a result of that discussion.

    Often when one comes together in these meetings the sort of thing one ought to discuss is not the issue that needs a decision tomorrow but the direction of policy perhaps over very many years. That is not a matter for headlines the next day or the day after. There is an immediacy about the news for these days; nobody these days runs large stories about how G7 leaders might have contemplated what the world would look like in twenty years’ time, there is not a lot of space in the press for that, they are more concerned about what actually happened today. Informality and informal discussions will enable those wider discussions to take place as well.

    QUESTION:

    Prime Minister, you were talking about home truths earlier on.

    There is a Gallup poll in today’s “Telegraph” which shows Labour on 43, Liberals on 26 and the Conservatives on 24, your own rating is down to 19% which is the lowest ever in Gallup. Why do you think the dissatisfaction at home with the Government is focused on you so personally and at the end of a week when you have achieved some widely-acknowledged good results here? Aren’t you going to feel like packing it in if your rating goes down any more?

    PRIME MINISTER:

    Politics is personalised – I think that is the nature of life not just in the United Kingdom but all over the world – much more personalised than ever it has been. I think that is part of the baggage people have to get used to. I don’t think one needs to let it necessarily worry oneself.
    I seem to recall during the last election answering an awful lot of questions about opinion polls. I also seem to recall what the election result was like and none of the opinion polls remotely got near to the result as it actually turned out to be when people had to make their decision.
    I understand people’ s concerns at the moment. It has been a rough old twelve months economically but if I had to said to you the evening after the election last year that fifteen months further on we would have inflation at 1.25%, interest rates at 6%, exports booming, a substantial shift in European policy towards our direction and we would have had four successive months in which unemployment fell without unemployment reaching 3 million let alone the 3.5 million most experts were predicting, I think you would have probably raised an eyebrow and suggested I think again but when you strip away lots of the short-term sensational matters that have dominated people’s interest in the United Kingdom over much of the last year, that is the reality of what has happened.
    The other reality of what has happened is that a complete parliamentary programme has gone through the House of Commons and very soon will be entirely through the House of Lords. If that same opinion poll had said what had Parliament been concentrating on this year I bet a huge proportion of people would have said: “Oh! They have done nothing except Maastricht and the European debate!” but in fact there have been a very large number of substantial reforming pieces of legislation through the House of Commons so I am not overly concerned about opinion polls.

    SAME MAN:

    Do you ever feel like packing it up?

    PRIME MINISTER:

    Do I look like it?

    QUESTION (PASS News Agency, Russsia):

    Prime Minister, were the respective leaders unanimous in their wish to meet Mr. Yeltsin in Naples and what is your personal opinion about the transfer from G7 to G8?

    PRIME MINISTER:

    The answer to the first question is yes, we were all completely unanimous. There was no shred of dissent about the desirability of Mr. Yeltsin coming to Naples next year or about inviting him now.

    I think the formula of G7+1 is an appropriate formula for the time being. The G7 are the largest industrialised nations in the world. At the moment, Russia does not fall into that category so I think it is appropriate G7+1 but Russia is a vitally important nation politically and in every other way and the G7 leaders think it is both appropriate and in our interests as well as in Russia’s interests to have this regular and annual dialogue.

    QUESTION (Anthony Rowley, Business Times and Oxford Analytica):

    Prime Minister, how seriously should we take this statement in paragraph 7 of the Economic Declaration that the G7 have agreed that no recourse should be made to initiatives and arrangements that threaten to undermine the multilateral open trading system? Presumably the search, for instance, for a framework agreement between the United States and Japan will continue to go forward.

    Secondly, I wonder what you make of Japan’s unwillingness at this stage to see an indefinite extension of the Non-Proliferation Treaty?

    PRIME MINISTER:

    I think you should take it seriously, I think the desirability to move towards an open trading relationship is very widespread and I think the importance of that can scarcely be overstated. It often surprises me when I talk to people around the world, the extent to which they do not realise the shackles that still remain on free trade. One of the great advantages of the market access package that the quad produced the other day was the scale of the reduction in many of the tariffs but in many cases it still isn’t abolition of the tariffs. We have a General Agreement on Tariffs and Trade. I think “General Agreement” is a rather informal position – I think it was intended to be temporary at the time and has never properly been formalised. I hope that we will be able to move to a more formal multilateral trade organisation as part of these particular talks. I think that would be a great advantage if we are able to do that. There still seem to be differing views on that but I certainly hope we can achieve that.

    Regarding your second question, I think that is a question for Mr. Miyazawa, not me.

    QUESTION (Chris Butler, Daily Express):

    If modesty will permit, would you describe what you think was Britain’s main contribution both to the summit and to the communique?

    PRIME MINISTER:

    How long have you got?

    QUESTION (Chris Butler, Daily Express):

    Briefly.

    PRIME MINISTER:

    You are asking for two things that are mutually incompatible, firstly to set out what we have done and secondly to tell you briefly – the two things are incompatible.

    If you look at the contributions – and you actually saw the speech never mind the communiques at Copenhagen last week and here – you will notice a very substantial similarity in the broad economic argument that I advanced at Copenhagen that is also here. I don’t claim to be the only person who holds that view but I certainly advanced it forcibly in Copenhagen and forcibly again here, the question of open markets and a whole range of supply-side reforms.

    No-one is seriously arguing these days – with the possible exception of the British Labour Party – that large fiscal expenditure is the way to lift countries out of recession and to put lots of people back to work. On the back of the fiscal deficits that people have, nobody is really advancing that argument.

    The opening up of markets, of supply side reforms, they are something we have argued for for some time now accepted in the Copenhagen communique, accepted here. That is a very substantial point.

    On some of the smaller points since you simply asked for an illustration, I suppose the summit reform is one illustration; the decision to invite President Yeltsin now is another initiative that came from the British; the decision to provide more help to Georgia, although it came last in the communique, is another British initiative. There are others as well. I will give you a full list later if you like.

    QUESTION (Paul Reynolds, BBC):

    If the situation in Bosnia deteriorates, will you cut and run or will you intervene more strongly?

    PRIME MINISTER:

    I don’t think one can make decisions of what one would do in Bosnia until you see what actually has happened on the ground. We have made it perfectly clear that we want to stay there and assist with humanitarian aid. We were the first in, we were there in large numbers. We have been in some of the most difficult positions. I think the British command and the British troops have done a superb job there right the way through some very difficult times, we have sponsored most of the UN resolutions.

    We still want to see a political settlement and the maintenance of humanitarian aid but beyond humanitarian aid it seems to me overwhelmingly likely that if there is a political settlement it will need some form of international support and international guarantees. If Lord Owen and others are able to reach a political settlement, the Muslim state will be in the centre. It will need access to the sea; that is going to need a corridor. It defies logic that that corridor isn’t going to need some form of international guarantee, very possibly United Nations troops but quite apart from that, the mess we are likely to find there at the end of the fighting is certainly also going to need an international presence to help with it. I think that, too, will be the United Nations and most of the big nations would expect to fulfil their obligations and play a part in that.

    QUESTION (Reuters News Agency):

    Prime Minister, would you please tell us how you see the present political upheaval in Japan. As you may know very well, Mr. Miyazawa called a snap election for July 18 and some people expect Japan will have a two-party system some time after the election.

    How do you see the situation? Japan is changing or not?

    PRIME MINISTER:

    I certainly think Japan is changing but if there is one thing I have learned in politics over the last 20 years, it is that it is extremely unwise to go to another country and comment on its political system at the beginning of a general election.

    I will simply say that having contested a number of general elections myself, they should be held at regular and not too frequent intervals and I wish all the participants in the Japanese general election as much enjoyment as I had in mine.

    QUESTION (William Keegan, The Observer):

    You mentioned the welcome fall in unemployment in the UK. How much of this do you attribute to supply-side policies and how much to devaluation, lower interest rates and the public sector deficit?

    PRIME MINISTER:

    I think the supply-side changes made throughout the 1980s have made the United Kingdom economy a much more flexible economy than it was in the past. Many people suspected that the unemployment tail after the end of the recession would go on just as it did after the 1981 recession, perhaps for three or four years. It was on that basis that so many people forecast unemployment going up to 3.5 million. Well, it is now clear it isn’t going to go up to 3.5 million. The adjusted figures – proper figures, if I can put it that way – didn’t actually quite reach 3 million and have now fallen for four months in a row.

    I think all the factors you mentioned are factors. The speed at which it turned round I think owes a good deal to the supply-side reforms of the 1980s. The best illustration of that I suppose one can give is if you look at the United States – perhaps the most flexible economy; whenever its economy shows an upturn their unemployment does tend to decline more rapidly than in other far more structured economies in western Europe so I think those supply-side changes played a significant role. That said, I have absolutely no doubt that the devaluation and the reduction of interest rates have accelerated that trend. I think that must self-evidently be so.

  • Mr Major’s Doorstep Interview in Tokyo – 7 July 1993

    Below is the text of Mr Major’s doorstep interview in Tokyo, held on Wednesday 7th July 1993.


    QUESTION:

    Prime Minister, what can you us about the movement we hear reported from the so-called Quad talks, does this mean that GATT is on its way?

    PRIME MINISTER:

    It looks as though it may, yes, it looks as though the talks have ended satisfactorily, I do not have all the details yet so I will spare you the details I do have, but it does look as though it is probable we will now have a market access agreement. That is important not just in itself but because it means we can then move forward to the multilateral talks back in Geneva and towards a GATT settlement, that is very important. It sounds technical but what it means is more trade, open market and more jobs, so it is very important.

    QUESTION:

    In short, why does it matter?

    PRIME MINISTER:

    It matters precisely for the fact that it will actually create jobs. If one can free up world trade there will be more world trade, the more world trade there is the more goods need to be produced, the more goods are produced the more people are working producing them, so in a single word it means jobs.

    QUESTION:

    Does it mean a transfer of jobs away from Western and developed economies?

    PRIME MINISTER:

    No I do not think so, that point is sometimes put, doesn’t it mean a transfer of jobs? But a general growth of trade, which is what a satisfactory agreement on GATT will mean, removing trade barriers and removing tariffs, that will help people in every country around the world and I think it will mean more jobs around the world. The estimates are that it will increase world trade very substantially, it removes barriers to many British exports when it is concluded, textiles for example, Scotch whisky perhaps, a whole range of areas that are of very great importance to us. Undilutedly good news when the round is completed, today it looks as though we have made a further step forward.

    QUESTION:

    How much extra bullying would you now need to do to turn a Quad agreement into a proper GATT agreement and are you worried that the French Prime Minister is not here?

    PRIME MINISTER:

    The French President is here. There is a lot of badgering being done over the last couple of years, no-one is in any doubt at all about the importance that the British have given to this particular settlement, it has gone on for some time. I wish we had settled the whole matter last year or the year before, but we have not. We have now made a great deal of progress. A substantial amount of a final agreement is already in place, there is still quite a lot to be done hut one ought not to overlook the amount that is now already in the bag and is agreed. We will just have to push and push and push, however unpopular it makes us, to try and get a final settlement later on this year.

    QUESTION:

    This will nevertheless have to go through the European Council, are you confident that all twelve member states of the Community will be on side on this and that means specifically the French?

    PRIME MINISTER:

    It is actually agreed by qualified majority vote, it does not need unanimity in the European Community, it is a matter that is dealt with by qualified majority vote.

    QUESTION:

    You are confident the Community will agree it?

    PRIME MINISTER:

    I think it would be folly if the Community were not to agree to go forward.

    QUESTION:

    Do you think we will get agreement by the end of the year?

    PRIME MINISTER:

    I very much hope so, the prize is very great. If there is one thing around the world that people are concerned about it is to see an increase in the growth of world trade, an increase in confidence and the creation of jobs. There are 23 million people in the G7 countries who are without work, there are 17 million people, rising, in the European Community without work. Now here is the biggest single policy change that can help to create new jobs, everyone should snatch at that.

    QUESTION:

    What are you likely to say in the world economy debate this afternoon?

    PRIME MINISTER:

    I think we have to remove many of the barriers to growth, there are a whole range of them, one of them of course is the trade barriers that we have been talking about that are subject to negotiation in the GATT round, others are the degree of deregulation that exists, there are a whole series of supply side changes that are necessary, a greater concentration on skills and education, a whole raft of things that I will set out this afternoon. But in essence we have to address long term problems that have suddenly become clear across the world as a result of the recession, if we address those problems now we will set the right basics in place for growth throughout the ’90s and greater prosperity in the ’90s. So it is removing those barriers to growth that I regard as the most important thing.

    QUESTION:

    It is deregulation really?

    PRIME MINISTER:

    Deregulation is a part of it, it is by no means the sum total of what needs to be done, but deregulation is certainly an important part of it.

    QUESTION:

    You have a bilateral today with President Clinton, after the disagreements on Bosnia and the American decision on nuclear testing, how much patching up have you got to do?

    PRIME MINISTER:

    There is no need for patching up. President Clinton and I speak regularly on the phone, we had a very lengthy conversation about this particular summit and related matters on Saturday, we will be meeting in the margins of this particular summit to discuss a range of things. There is no patching up job to do, there is a whole raft of areas where we are in complete agreement and I suspect the principal agenda for this summit is one of those areas where we are in total agreement.

    QUESTION:

    [Inaudible] changing the balance of power in the world, how hard are you having to fight to maintain Britain’s position at the table at G7 and at the UN?

    PRIME MINISTER:

    I am not having to fight at all hard, Britain’s place at the G7 and at the United Nations is entirely secure, the only time it is ever questioned is when people like you ask me questions like that, otherwise it is not in any doubt whatsoever.

    QUESTION:

    Why is the New Statesman settlement so low for you personally?

    PRIME MINISTER:

    The important thing in the New Statesman settlement, and all the other elements of that settlement, was that people acknowledged that the libel was untrue, that has been acknowledged, everyone concerned has now paid damages. The size of the damages was never a relevant factor, the confirmation that the stories were untrue and unfounded was the relevant factor, that has now been obtained from everybody concerned with the case, those who spread the libel, those who printed the individual publications, all of them have now indicated that it is unfounded and untrue, I am satisfied with that, it is now no longer an issue I need concern myself with, it is dead and gone.

    QUESTION:

    But the New Statesman is claiming a moral victory and there is a suggestion that you have accepted these low damages in order to avoid appearing in the witness box?

    PRIME MINISTER:

    It is a curious moral victory when they admit it cost them a quarter of a million pounds in total, that is a very curious moral victory. They have admitted what they said was unfounded, they are not in a position to repeat, they cannot repeat it, it has cost them a quarter of a million pounds, if that is a moral victory it is not the sort of moral victory they would like every week.

  • PMQT – 29 June 1993

    Below is the text of Prime Minister’s Question Time from 29th June 1993.


    PRIME MINISTER:

     

    Malnutrition and Infant Mortality (Iraq)

    Q1. Mr. Dalyell : To ask the Prime Minister what is his most recent information from UNICEF about the alleged infringements of the United Nations convention on the rights of the child involving malnutrition and infant mortality in Iraq.

    The Prime Minister (Mr. John Major) : No such information has been received from the United Nations Children’s Fund, but we remain in close touch with United Nations agencies about the humanitarian situation in Iraq.

    Mr. Dalyell : Has the Prime Minister been briefed by the Foreign Secretary and by Sir Michael Burton about the visit by my hon. Friend the Member for Glasgow, Hillhead (Mr. Galloway) and Tim Llewellyn to the paediatric hospital in Baghdad, where we saw lines of infants with swollen tummies and swollen private parts expiring as a result of malnutrition- related diseases such as marasmus? Does the west have any obligation to do something for injured infants who are without pharmaceuticals or medicines as a result of the missile attack on Baghdad? Would it not be wise, for reasons that I gave to Sir Michael Burton and the Foreign Secretary, at least to hear what the Iraqi people have to say?

    The Prime Minister : I am, of course, aware of the hon. Gentleman’s humanitarian concerns and of his discussions and his report to the Foreign Secretary. However, I think that he is misguided in the way in which he attributes responsibility. To be frank with the hon. Gentleman, I have to say that it is not the responsibility of external countries that the difficulties in Iraq, which led to the devastating situation, have been brought about. We very much wish that this were not the situation. However, it is, and over recent months we have done what we could to put it right. With regard to the attack, I shall not respond directly to the hon. Gentleman as the matter was widely discussed in the House yesterday.

     

    Engagements

    Q2. Sir Michael Neubert : To ask the Prime Minister if he will list his official engagements for Tuesday 29 June.

    The Prime Minister : This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

    Sir Michael Neubert : Does my right hon. Friend share my sense of injustice about the fact that, on the only occasion this Session when I have the good fortune to be able to ask him a question on television, the BBC is showing Wimbledon on both channels? Would not the watching public be immensely encouraged to learn that we are today considering the Criminal Justice Bill and that the police are going to make fighting crime and protecting the public their top priority, unencumbered by unnecessary paperwork?

    The Prime Minister : With no disrespect to my hon. Friend’s question, I think that that is the best decision by the BBC that I have heard for some time–game, set and match to the BBC, I think. I agree with the substance of my hon. Friend’s question. What most people in this country wish to ensure is that our police service is doing the job we most wish to see it do, that is to say, not pushing paper but catching criminals.

    Mr. John Smith : Is the Prime Minister aware that it is three months to the day since the House debated the Government’s White Paper on the coal industry? Does he recollect that the public, the press and some of his own Back Benchers were led to believe that 12 pits would be saved by that White Paper? Why is it that, only three months later, three of the 12 pits face closure?

    The Prime Minister : I think that the right hon. and learned Gentleman knows that there have been severe geological problems at some of those pits, resulting in an excessive level of cost. British Coal has talked to the men about the problems. I understand that at Rufford the men voted to close the pit when the existing face is exhausted and at Markham they agreed to immediate closure. British Coal is still committed to the market-testing exercise.

    Mr. Smith : Does the Prime Minister not understand what is happening to the miners–that if they do not vote for closure they lose redundancy payments? Does he not understand what is happening in the market? British Coal is now offering coal at a knock-down price which would give the consumer much cheaper electricity than he or she could get from any other source. If the two privatised generators still will not buy at that price, does that not prove that the market is rigged against coal and that, if it goes on, pit after pit will close and will shall lose a vital industry?

    The Prime Minister : The reason for taking the decisions on coal some months ago was to make sure that there is a viable industry that can continue in the future. It will be a smaller industry than once it was, for it has been shrinking in size year on year over the past 30 years. That is a fact of life which the right hon. and learned Gentleman, I and every hon. Member well understand. It is the market for coal which will determine the size of the industry. The Government have made it clear that they are willing to provide a subsidy to help the deep mining industry secure supplementary coal to generators at world prices. That was and is the position.

    Mr. Smith : Does the Prime Minister not remember clearly that the House was led to believe that 12 pits would be saved as a result of the White Paper? Why does he not come clean and admit that the White Paper was a fraud and is now exposed as a fraud? Is it not a perfect example of the style of the Prime Minister and his Government that they produced a White Paper for 36 hours’ publicity, which has not survived for three months in the real world?

    The Prime Minister : The right hon. and learned Gentleman might perhaps have observed what Mr. Scargill had to say at lunchtime when he said :

    “The Labour leadership is more interested in opinion polls and images rather than principles and real policies.”

    Miss Emma Nicholson : During his busy day, has the Prime Minister had the opportunity to read the letter from the hon. Member for Linlithgow (Mr. Dalyell) in The London Literary Review, in which he gives inaccurate medical information on the state of child health in Iraq? Will the Prime Minister remind the hon. Gentleman that United Nations Security Council resolutions 706 and 712 of August and September 1991 authorised Iraq to export $16 billion worth of oil to buy medicines over a six-month period but that those arrangements have never been implemented?

    The Prime Minister : I have not seen that particular letter, but my hon. Friend is quite right about the proposition that has been available to Iraq for well over a year whereby it could export oil and, in return, have medical and other equipment. The Government of Iraq–Saddam Hussein–chose not to take up that option. For that reason, he is primarily to blame for the present difficulties in treating people who are sick and ill in Iraq.

     

    Q3. Mr. Hanson : To ask the Prime Minister if he will list his official engagements for Tuesday 29 June.

    The Prime Minister : I refer the hon. Member to the answer I gave some moments ago.

    Mr. Hanson : Will the Prime Minister confirm to the House and to the many pensioners lobbying Parliament today that the Conservatives have spent millions of pounds of taxpayers’ money on tax relief to the wealthiest members of Lloyd’s, while continuing to persist with their policy of putting VAT on gas and electricity? Does he appreciate that that is typical of the present Government?

    The Prime Minister : It is typical of the hon. Gentleman to misrepresent the position. The fact is that the success of Conservative policies over the years has enabled pensioners’ incomes to increase by 30 per cent.–37 per cent. net of housing costs–since 1979. The hon. Gentleman should perhaps remind himself, and tell others, which party tried to cut the Christmas bonus, cut spending on the national health service, failed to uprate pensions and let inflation get out of control and wreck the savings of millions of pensioners.

     

    Q5. Dr. Goodson-Wickes : To ask the Prime Minister if he will list his official engagements for Tuesday 29 June.

    The Prime Minister : I refer my hon. Friend to the answer I gave some moments ago.

    Dr. Goodson-Wickes : I share my right hon. Friend’s approval that Wimbledon is monopolising all channels, but, in the context of the necessary review of public spending, may I ask for an assurance that there will be a rigorous clamp-down on all those who are claiming benefit on fraudulent grounds at the expense of those most worthy of help in society, to whom benefits should be targeted?

    The Prime Minister : I can give my hon. Friend both assurances. I assure him that the Government will honour their pledges to uprate state retirement and child benefits and so protect the most vulnerable in society. I also assure him that those who try to defraud the benefits system will find it increasingly difficult to do so. They will come up against a Government anti-fraud policy which expects to net savings of nearly £1 billion this year. We want those resources so as to make sure that they are available for those who need them most. I make no apology for protecting taxpayers from those who seek to abuse the system.

     

    Q6. Dr. Lynne Jones : To ask the Prime Minister if he will list his official engagements for Tuesday 29 June.

    The Prime Minister : I refer the hon. Member to the answer I gave some moments ago.

    Dr. Jones : In view of the revelations at the trial of Christopher Clunis, who stabbed and killed Jonathan Zito, will the Prime Minister accept that although most people suffering from schizophrenia are not dangerous, the failure of the Government’s care in the community policy means that dangerous mentally ill people are walking the streets? What does he intend to do about that, and will he now order a public inquiry into the case and its implications for community care, as requested by Mr. Zito’s widow?

    The Prime Minister : The hon. Lady may not know it, but the care in the community policy has been a cross-party policy in the House for many years. Everyone is deeply sorry to hear about that tragic case, and I have deep sympathy for Mrs. Zito and the other relatives concerned. Nevertheless, I am sure that our community care policy is right for the patients concerned. It is right to encourage them generally to lead as independent a life as possible away from large-scale institutions. To that end, we now devote spending of more than £2 billion per year, and we have increased it substantially to ensure that the resources devoted to it are able to meet the problems which exist.

    I have to say to the hon. Lady that picking out a tragic case such as that in the way that she did does no credit to her.

     

    Q7. Mr. Evennett : To ask the Prime Minister if he will list his official engagements for Tuesday 29 June.

    The Prime Minister : I refer my hon. Friend to the answer I gave some moments ago.

    Mr. Evennett : Will my right hon. Friend confirm that the United Kingdom is the only leading country in Europe experiencing economic recovery? Will he further confirm that while other countries in the European Community languish in recession, our economy has low inflation, falling unemployment, low wage settlements and the highest growth rate in Europe? Does he agree that that is good news for British business men and exporters and will help the nation to get roaring forward again economically?

    The Prime Minister : I believe that it is good news for everybody, with the possible exception of some Opposition Members for whom good news is extremely bad news. Britain was the first country in Europe to go into the recession ; it is now among the first to emerge. Although conditions abroad throughout the Community may be difficult for some time, the Community itself and others are now forecasting that we shall have the highest growth rate in the Community this year and the highest growth rate again next year.

    Mr. Molyneaux : Have Her Majesty’s Government given any commitment to the Labour party’s proposals for joint authority over Northern Ireland, as set out in the documents published this morning?

    The Prime Minister : The first I heard of the apparent proposals by the Opposition spokesman on Northern Ireland was when I read that astonishing story in The Guardian this morning. I have no means of knowing whether The Guardian story is right or wrong. I hope that it is wrong, but, as Opposition Members seem to have questions planted upon them by The Guardian, it does not seem unreasonable to me that they may plant their policies upon The Guardian themselves. I can only say that that policy, if it is the policy of the Labour party, is a recipe for disaster. If it is true, I hope that the Leader of the Opposition will request the resignation of his spokesman this day. The right hon. and learned Gentleman has the obligation to tell the people of Northern Ireland whether or not that is the policy of the Labour party.

    Mr. Brandreth : May I congratulate my right hon. Friend on literally flying the flag in support of Manchester’s Olympic bid? Does he agree that the bid is bringing more money, more jobs and more prestige to an area of this country which is already world class?

    The Prime Minister : I agree with my hon. Friend. I believe that hosting the Olympic games in Manchester would be good for the north-west, good for Britain and good for the Olympics. That is why the Government are determined to do all that they can to back Manchester’s bid to bring the Olympics here for the millennium. We have provided full support for that bid. I was delighted to welcome the International Olympic Committee to Downing street yesterday. I shall be meeting the president of the IOC next month, and I look forward to going to Monte Carlo to help to promote the bid in September. The Olympic games which mark the year 2000 will have a special significance and I want to see those games here in Britain–in Manchester.

  • Mr Major’s Speech to the Welsh Conservative Party Conference – 11 June 1993

    Below is the text of Mr Major’s speech to the 1993 Welsh Conservative Party Conference, held on 11th June 1993.


    PRIME MINISTER:

    I had hoped to be here a little earlier to join you for lunch and to have the opportunity of meeting a number of you, but I was a little delayed by the weather as well. I’m very sorry about that, but I’m much more concerned about the people who’ve suffered as a result of the weather. They’ve suffered a great deal more than inconvenience, the need for evacuation, many people whose homes have been damaged in the floods on the North coast. I’m delighted that Wyn has already been there and delighted that John and Wyn will be returning later on today. I’ve asked them to give me the fullest possible report of the damage that has been caused. But I would like to express my sympathy to everyone who has faced these particular difficulties over the last few hours and also my congratulations to the emergency services. They’ve acted swiftly, they’ve acted efficiently and I believe they deserve our thanks for everything that they’ve done.

    Before I turn to domestic matters, I just want to say a word or two about something happening in the last few hours in Bosnia. Many of you will know, all of you will know, for many months now British troops have been in Bosnia helping and protecting convoys in a most remarkable way. As a result of the work of those troops in Bosnia, many thousands of people are alive who otherwise would not have survived the last winter. It has been a superb performance by the British troops who’ve been there.

    Yesterday, as you know, they were involved in some incidents when a convoy they were supporting was attacked. The British troops, rightly in my view, responded in self-defence and, let me make it absolutely clear, our commander on the spot has complete authority to take any decisions he considers necessary to protect the safety of our troops. They’re there in Bosnia for humanitarian reasons and there are two criteria governing their presence there – can they carry out their mandate and can they carry out their mandate without unacceptable risk?

    The recent incidents we’ve seen may, may be relatively isolated, but I have to say to you that there is now increasing evidence of widespread deterioration on the ground. We have contingency measures in hand to protect our troops in Bosnia and to ensure their reinforcement if that should prove to be necessary. Yesterday, we announced further measures to supplement them. There have been long-standing measures, of course, the Ark Royal lying offshore and with cranes on that particular ship. There will be more reinforcements as necessary. And I wish just to give you this assurance today we will not take any unacceptable risks with the lives of our troops in Bosnia.

    Madam Chairman, it’s always fun to be back in Wales. I dare say that sounds to you like an all-purpose politician’s general issue compliment. I dare say it does, but it isn’t. I just think that Wales is wall-to-wall knock-down beautiful and every time I come here I find that opinion reconfirmed. From the southern approaches to the dark mountains, wherever you go there’s something very special and very beautiful to see and I’m delighted to be back here again today.

    And let me just say a quick word about Welsh secretaries of state. David Hunt succeeded by John Redwood. Superlative performance succeeded by superlative promise. Achievements for Wales to be followed by further achievement for Wales. John Redwood is here to fight the corner for the principality and I can tell you from my experience of him in Government he will fight it very hard, very often and very fiercely. You will have a very good champion.

    It’s possible, communications being what they are, that you may not have heard that the Cabinet changes involved the odd scratch. This move in Wales was oil-sweet and brilliant and, when people see how successful it is, I shall be happy to take all the credit for it. Change of Secretary of State. But Wales is used to change, not just changes of secretaries of state, but change on a much wider canvas than that. If you look down the last decade or so of the history of Wales, it is a story of change, the story of a modern country, a growing country, a winning Wales steadily building itself up and today leading the United Kingdom out of recession.

    There was a time when you could have pushed Wales to one side, as though it was just there on the side of England, but you certainly can’t do that any longer and no one would wish it. Since 1979, on average, every year there’s been 1,500 new businesses a year, 1,000 new inward investment projects – and not tiny ones, great companies like Toyota, Bosch, Sony, all coming here to establish themselves in Wales not just temporarily, but permanently. Over 800 new manufacturing plants and, the most latest example of course, Amcor’s 26 million pounds.

    They could have gone anywhere, they could have gone anywhere in the European Community and established themselves to do future business. But they came here. They choose of their volition to come here and establish themselves in Wales and they did so I believe for two overwhelming reasons. Firstly, because of the skills that are available in Wales and the attractive quality of life that they can find here. And, secondly, because of those Conservatives that made it attractive for overseas investment to come to the United Kingdom rather than other countries in the European Community. That combination – Welsh skills, Welsh quality of life and Conservative polices – has been a formidable combination for the prosperity of Wales in the last decade.

    And Wales has benefited, as well as the rest of the United Kingdom, from that. Of course it hasn’t always been apparent to everyone. Not everyone has always taken the long-term view of what needed to be done. I wonder, I wonder if you remember, just about 10 years ago, the great Tory crime of closing down the steelworks of Shotten. Mighty steelworks. Steelworks with a great history for which there was great affection, understandably. But a steelworks with no more work. A steelworks that it was said, what was the phrase that was used – “a steelworks and jobs cynically thrown on to the scrapheap” – that was the expression that was used. That’s what Labour said. They felt we should have burned money at its altars, as the world market for steel went down, that we should have carried it through the streets in procession like the embalmed corpse of a Mediterranean saint. They have a lot of primitive religion at the heart of the Labour Party.

    But, what has happened? What has happened to those people they said would never work again after the Shotten steelworks closed down? What actually happened has been dramatic and it shows the qualities and the opportunities that exist in Wales. What has happened is that a realistic Shotten has come through, it’s come alive, it competes and it lives on its own energies – a living competitor, not a tax-eating shrine. That is what has happened over the past decade. And it means the people who worked there had jobs with a future, not jobs that only had a past and were dependent day to day upon subsidy and the hope that something would turn up in the future.

    The fact is that Labour just took the short-term option. Here was an opportunity to kick the Government with a difficult decision and of course they were not prepared to take the long-term view. Then as now, short-term opportunism dominated their attitudes. But if we had listened to them then, what today would be the position of those working in the steelworks at Shotten? They would still be living in daily fear of their jobs. They would still be on yearly subsidies. They would have no security and no future. And if that attitude had been spread right the way across Wales, we would not have seen the quantum leap in opportunity and living standards that has stretched right across the principality over the last decade.

    Have they changed? Our opponents? Have they, hell. Cardiff Bay barrage. Now you’ve had the Labour resistance to the Cardiff Bay barrage. Here is a great development, a development that will do immense good for the future and so it must, by some Labour MPs, it must be stopped. A remarkable development opposed by unremarkable, bone-headed socialism. A small festival of negativity. What an attitude that is! What is it they actually say to the people of Cardiff? What is they’re saying, the opponents of this great project? They’re saying, we can’t have these jobs and these buildings mucking up Cardiff just when the council’s got everything right. That’s what they’re saying. If they’d been around on the day of creation they’d have demanded an adjournment.

    And it’s no good the leadership walking on the other side of the road and washing their hands of it. They have done nothing, nothing to restrain these Labour MPs holding back this moment and I think I can understand why. Up there in Scotland where the Labour leadership lives, they can’t see the importance of investment here in Wales; but we can. Here, here in the principality and may it always be a principality, people are proud of being Welsh and they’re right to be proud of it. Few political ideas have been worse served by politicians in this century than the idea of nationalism. I’m unapologetic about it. I am a nationalist, a British nationalist. Any leader of the Conservative and Unionist Party could be no other.

    Disraeli used to say that our party was a national party or it was nothing and, to understand what it means to be a Conservative, you must first understand what it means to be a nationalist. A true nationalist doesn’t need to prove himself by exaggerated histrionics, doesn’t need to promote himself by wrapping himself in a flag and offering a cheap imitation of what nationalism really means. Those people are offering symbols, they’re not substance. Put them aside and ignore them. Nations are made up of people; the true nationalist, the true nationalist wants those people to live at ease with themselves, confident, secure, able to reach out themselves, to reach and touch and achieve their own individual ambitions. His isn’t a sectional interest. He wants to build a society where every single citizen, wherever they may have started from, rejoices in their own common birthright, in their own country that they love.

    And to do that, we must understand what it is that people actually want, what their ambitions are, what their hopes are for themselves and their families. They have their place, no doubt, but go out into the housing estates of Cardiff or Peterborough, or Birmingham, or Leeds and Glasgow. Go into the living room of the three-bedroom semi-detached house and ask them, what do you want? What sort of country do you want to live in and see built up? It is the answer to those questions that determines where the heartbeat of Britain lies and what it is that people want.

    I will tell you what the answer is I believe you will consistently get, whether in Wales or Scotland or any of the regions of England. First and foremost, they want jobs that allow men and women to provide for themselves and their families. Jobs that give them independence and self-respect. Secondly, they want a decent home and the opportunity to own that decent home as 7% of people do in the principality. Thirdly, they want to be confident that their children have access to a good school, that the whole family will have access to good medical care if and when they need it and that a structure exists to provide them with financial security in old age, in hardship or in the advent of ill health. And it’s when those fundamental securities that are rooted deep in the marrow of the instincts of the British, it is when those fundamental securities seem uprooted that most people feel most threatened. And that, right the way across Europe, from one and to the other, has what has happened in recent years.

    And yet we Conservatives, we Conservatives care for those fundamental securities above all else, so we have a task on hand. We must convey that message that we understand and care about those fundamental matters right back to the British people in every part of the United Kingdom. Nothing’s more important, nothing is more pressing, so let me just pass this message to everyone who wishes the Conservative Party well. No diversions, no squabbles, let’s get on with that job of passing back that message and then we will have the self-confident expanding country that we all want to see.

    But our people are ambitious. They want a good deal more than what I’ve just set out in the last few minutes and they’re right to do that. They want with every justification, in my view, to feel safe at home and safe on the street. And they want to feel that the nation to which they belong can hold up its head in the world, play its part in the world and be a force in the world. I believe those are the instincts and the ambitions of the people who elected us and of millions of others who did not vote for us at the last occasion but share those same basic, patriotic instincts. We have no particular control over patriotism. It stretches across all parties, and I freely, I freely acknowledge that.

    But those are the ambitions of the people who did elect us. And they are also the ambitions that we have as a Party for the people of this country of all parties. And it is our task in Government to find ways of enabling those ambitions to be met. So how do we do it? If the 1980s taught us nothing else, and in fact it taught us a great deal, it was a very remarkable decade. But if it had taught us nothing else, it did teach us one vital lesson. You cannot spend what you haven’t earned. There’s not the slightest point in arguing about spending priorities until you have first addressed the question of how you pay for whatever it is that you want. And so all social policy must begin with economic policy. And all economic policy must begin with sound money. Our commitment as a Party instinctively, an instinctive commitment, our commitment to sound money, to keeping inflation down isn’t for us an abstraction, a by-way on the political high road. It is the absolutely essential bedrock upon which our economic policy and therefore everything else must depend.

    The last two years have been cruelly difficult, I know, for many people. We came from a boom in the late 1980s and into a recession. The boom spiralled above anything we had imagined and the recession lasted longer and was deeper than we anticipated. So it’s been a long period, a painful period, but as we emerge from that recession and as we lift our eyes and look beyond our own shore, we see that our problems are not just in this country. As we emerge from recession, Germany, Spain, Italy, Portugal. Japan, even the United States all have to one degree or another, and in some cases very seriously, economic difficulties. And I have to say, Madam Chairman, some of their leaders – shock, horror! – are even said to be unpopular.

    There’s a novelty for a politician. We here are out of recession. Inflation is now at under one and a half per cent. Interest rates are at 6%. The exchange rate is extremely competitive. Our exports are growing and our business opportunities are ahead. Now is the time to lift our prospects, lift our hearts and take the opportunities that lie immediately in front of us. And if we’re to take them, we have to do so in partnership with business, for it is private enterprise that we Conservatives look to generate the growth we want to see. It cannot be done in Whitehall by politicians and it cannot be done in Whitehall by bureaucrats. So let’s be quite clear about that. It’s not we politicians who create jobs. It is successful businesses providing what people are prepared to purchase that actually provide jobs in this country.

    Key decisions aren’t taken by a few politicians in Whitehall, They’re taken every single day by millions of individual people, deciding firstly that they’ll spend their money and secondly in deciding on which goods and which services they’re prepared to buy. Now, our relationship as a Government is changing with business. And it is right in my view that it should change. If we look back with that 20/20 vision that we can all have with hindsight and we’ve seen a bit of that from time to time, if we look back with 20/20 vision at the ‘60s and ‘70s, I think it is clear in retrospect that governments were too keen to tell business what to do, to make their decisions for them, to decide where they should invest and how. To pick the right winners in Whitehall rather than let them win in the marketplace. We learnt it didn’t work.

    And then in the 1980s, I think as we look back in the 1980s, it is clear in retrospect that perhaps we were just a touch too laissez-faire on some occasions. Too keen to tell businesses to go out entirely on their own, it was cold bath time with a vengeance. And sometimes that may have left some of our businesses at a competitive disadvantage. We have learned, too, from that, particularly building on the remarkable growth that business achieved n that bracing climate. And so in the 1990s we’re embarking on an evolution of our partnership with business. Business, as in the ‘80s, must make its own decisions and exercise its own skills. Only they can do that.

    But we in Government, perhaps should take every opportunity to smooth the way for our businesses to build the success and the prosperity we wish them to achieve. And there’s much we can do to achieve this, to set on course the right economic environment, a consistent low level of inflation and all the economic things that follow that. To make the supply-side changes and to push the jargon aside. To make sure we have the right education system producing the right youngsters with the right skills and I’ll turn back to that a little later. To make sure that our training systems are the right training systems to produce the right skills for the 1990s and the new century. To complete those elements of trade union reform still left undone but now almost wholly completed, finally – to put them in place.

    For the Government to use its political muscle for British contracts abroad. When our ministers go abroad, I want them, whenever they can, to take trade missions with them. Trade missions to fight to sell British goods abroad and to attract investment from abroad into this haven of European investment as M Delors so kindly put it for us. Not all his comments are always so helpful. Ministers in the Welsh Office have led the way in taking trade missions abroad and you have seen the results here. And I know the plans that John and Wyn and William have for the future. They will be in Wales most of the time, indeed most of the time and may occasionally visit the House of Commons in between.

    They will be taking the Welsh case abroad and bringing foreign investment to Wales. And then we must use our political muscle to lobby politically for our great British companies and we must make sure that the changing attitude in our foreign representation at embassies and elsewhere continues. I want our embassies to be as concerned about trade as they are about cocktail parties and diplomacy.

    And we must make sure that we don’t put our British firms at a competitive disadvantage. That is why there have been the very remarkable changes in export credit cover, both the breadth of it and also the cost of it, over recent months so British firms can compete fairly with their European and other competitors. The growth in export promotion services and other ideas that are coming through at present. And then of course there’s the Government’s role to provide the right infrastructure for business. This isn’t just a question of huge taxation and huge Government expenditure. That has its part but we are unlikely to deliver the infrastructure that business would truly like simply through taxation on companies and on individuals.

    And so we’re going back to our basic instincts. Who built the great canals and many of the railways in the first place? It was the private sector. There’s nothing novel about that, it’s just a post-war phenomenon that believes it can only be built by money compulsorily extracted from your pocket and recycled in Whitehall and then spent as the men in Whitehall think best. And what we’re doing is throwing away the old rules so that private finance and joint finance can go out and help the Government build the infrastructure that this country and British business needs. But where old rules, old Treasury rules – they were, you will I know be shocked to hear restrictive rules. I spoke to a very distinguished civil servant who had drawn up these rules that prevented so much private finance. And I said to him, probing delicately, “Do you think these rules are quite right?” “Well,” he said, “I think they’re barmy.” Well, he was right, they were barmy and they’re now defunct.

    And then in the interest of this growing business and jobs and prosperity, we need to oppose unnecessary social costs upon our great and small companies in this country. Whenever anyone mentions the Social Charter, you can see a socialist quiver. “Social Charter sounds good, we better have a slice of that.” But they don’t read what it is. Sounds very amiable The Social Charter is a job destruction programme for the European Community, European employers get extra costs, their goods become less competitive and the United States, the Pacific Basin and Japan get the orders and get the jobs. The only right that workers get out of it is the right to be out of work while Brussels politicians decide that they will provide extra socialist systems.

    That’s not a bargain – that’s a slow acting poison for prosperity in this country and right the way across Europe. And I have to say to you I’ve always been a strong supporter of our place in Europe because that is where 60% of our trade goes. No point in wrapping ourselves in [indistinct] and pretending it isn’t all there. But we need influence there and if ever there was an indication of why we needed influence, it is their wish to impose these extra costs right the way across the community. Because they look inward only; they do not realise that the whole of Europe must compete with the United States, with Japan and with the Pacific Basin. And until that time they recognise that, acknowledge that and act upon that, we will export our prosperity and we will give them the jobs that ought to be here in Europe. And for those of them who say, “Well, you’re not whole-hearted,” whenever you bump into a liberal, “Well, you’re not whole-hearted about Europe.” That’s what they say. “You don’t want to swallow everything the Commission propose.” Too true, I don’t. It’s a pity that they do. I would just suggest one thing you say to our liberal friends when they say that to you. “The good European fights for the right Europe” and that is what we’re doing.

    Of course I don’t expect the Labour Party to understand that. Mr Smith in auto reflex action regards it as demeaning for Britain to proclaim our lower costs. What a fatuous comment! Can you imagine selling your house – “I’m not going to project this nice low cost, it’s very expensive” you tell the purchaser. Of course we project our lower costs. We want people to come here. I want them to be in work. That’s why we project our lower costs. That’s why we have a low tax structure. That’s why we’ve been deregulating. That’s why we’ve had so much inward investment over the last decade that we wouldn’t have had if John Smith’s philosophy had been in charge.

    But if pronouncing that lower costs is what we’re after is a bad thing, it does raise an interesting question. What would he like? Higher costs? Higher costs – less jobs? Less opposition? What a brainless policy for this country, No wonder he thought that higher taxes would win them the last General Election. And in order to emphasise his non-point, he talks about a sweatshop economy and then he goes on, he goes on to demand a high-tech, high investment economy. What insight. Why did I never think of that? We all want that. The question is not whether we want a high-tech, high investment economy. Every sensible person wants that. The question is how we get that economy and keep it in the future, and we won’t get it if we pile on taxes and we pile on social costs and that is the message you must take to every doorstep in the land.

    Success for us these days – we don’t have a great empire, a market waiting there automatically willing to snap up anything we produce. It’s a different world now. Our businessmen have to go out there and they have to fight like hell in a difficult environment for their sales. It isn’t as once it was. Success doesn’t come at the imperial clicking of a British finger. We’re not beggars in the world but we’re not altogether choosers either. We have to go out there and fight for our prosperity and fight for our future. And if you look at what’s happening on your own back door, solid jobs, good jobs, permanent jobs, they’re coming to Wales and thank God for it. And the things that I’ve described as happening in Wales are happening elsewhere. The investment, the incoming companies, the new competitiveness: these are the steady-built walls of recovery and security for this decade and for the new millennium. That is the long term policy that is right for this country and from which this Party will never deviate.

    And let me say this to you, Madam Chairman. If in the decade of Conservative governments still to come, if we build everywhere as we have built in Wales, with jobs, with productivity and with exports in mind, we shall build to last. And all the questions that need addressing about this country are long term questions and so the answers need to be long term answers. And one of those answers, I believe, is that new arm-in-arm partnership, Government and business using their own skills together, working together for the prosperity of Britain.

    Madam Chairman, one thing business knows is that we have no choice but to control public spending and restrain taxes. And when I say that I know what will happen when I say that, know that the Labour Party will immediately jump around. Mr Gordon Brown will issue a press release. He’ll tell us that this proves that all his scare stories were right. He’ll undoubtedly demand a parliamentary statement. He will tell us things are terrible and they’re getting worse. You know, I can’t think why, but it reminds me of a toy that my son had when he was very small, many years ago; it was a small, a small Action Man toy that was on a little string. And when you pulled the string, this little Action Man uttered a few predictable sentences. I don’t actually recall whether he asked for a parliamentary statement or not but, thankfully, I do recall that when the string broke he went silent, so all is not lost.

    So, we must control public spending and restrain taxes. That’s not just a populist cry for lower taxes. We know we must restrain public expenditure, not because we’re opposed to public expenditure per se, but because we’re bound by the laws of arithmetic. You can’t spend what you’re not prepared to finance from either taxes or borrowing. And I hope there is no doubt in anyone’s mind we’re not prepared to see an ever-increasing tax burden. And nor are we prepared to mortgage our future by unrestrained borrowing. So, we have to ensure that expenditure is properly disciplined.

    At present, we have a very large deficit, much larger than we would wish it to be at around 50 billion. And people say, “how”? Tory deficit, the opponents of our party call it. How has it happened, we had a surplus three or four years ago? Yes, we did. We had a surplus on the back of an unsustainable boom with all the tax revenues that helped put our finances into surplus. But the flip side of boom is recession and the flip side of surplus is deficit and we must now rid ourselves of the deficit. Seventy per cent, or thereabouts, one can never be entirely precise about the figures, but as close as we can get, around 70% of the deficit is cyclical. By that I mean, stripping away the jargon, it is the effect of recession the fact that we have a tower tax revenue – fewer people in work, less taxes, fewer spending, less VAT, fewer house sales, less stamp duty. And of course higher public expenditure to protect people in difficulty. And therefore a gap opens up between income and expenditure that we have to borrow in the short term during the recession. That is the effect of recession – lower tax revenue, higher social expenditure and a gap between income and expenditure.

    That will, over time, reverse itself, but there are other more fundamental reasons for the deficit as well. There are demographic changes, more thankfully as a result of the work done by the Health Service, not least by Norman Fowler who was Secretary of State for many years in that crucially difficult job. Our Health Service is better than ever it has been before.

    And I may say, those people who said otherwise at the Monmouth by-election learned different at the General Election. But there are demographic changes. Because of the changing diet and the changing healthcare that’s available, more people live much longer. More of our elderly can expect to live longer and more fruitful lives in retirement and that is very expensive. It adds to costs, costs willingly met, but costs that must be met. There are more students. We want more of our young people to go on into further education and, at an astonishing rate, that is what they’re now doing. There are more demands we wish to meet – the healthcare that was never there a few years ago is perhaps the most obvious example of that. And all that’s expensive, but these are matters we wish to meet.

    [small section of speech missing]

    Madam Chairman, over the last few months, there has been something of a rumpus about education. We have been very heavily abused from many sides on the subject of testing, cardboard images have been set up. On one side there are the professionals, dedicated teachers serving the nation and, on the other side in this cardboard image, an intruding old Government interfering, bossy and setting irrelevant tests to interfere with the peaceful life our children have at schools. And our critics, including the Labour leader, are devoted to that cardboard image. I can’t think why he had such an affinity for cardboard images. But what he doesn’t have and what our critics don’t have, is a criticism of the performance of much of our education system. And let me be blunt, we should have a criticism of the performance of much of our education system because the reality is, I am sad to tell you, that one in four of our children leave secondary education and can’t read properly, can’t write properly and are not competent in grammar. And what are they going to do? They can’t all be Prime Minister. I’d better tell the press, that was a joke. But I bet it turns up in more columns than you’ve had hot dinners this year.

    But that education outcome, that fails our children. Many of our teachers are excellent and I have a great admiration for them, but they aren’t all excellent. There’s a choking [indistinct] of educationalists, a theory that despises grammar, looks down on vocabulary and derides the well-stocked mind. And it’s not new: perhaps we should have faced up to it years ago. But there is in modern teaching, and in my view there has been for nearly 30 years, a trade unionism of the mind, a willingness to accept low performance far too readily. And that thinking’s decreed learning – learning’s reactionary! What you go in the classroom for is to have some haphazard discovery. Well, I don’t mind my children having some haphazard discovery, but I really send them to school to learn so that when they leave school they’re equipped for a tough competitive world that will lie ahead of them. And far too much well-meaning, theorising nonsense is poked at our children in school. And I will not mince my words – I think that is a betrayal of our children’s prospects in schools and no government could or should stand aside from it.

    I’ll never forget, I’ll never forget a male teacher in a TV documentary and he was holding up a page of paper and it had blots and words and every fifth letter was spelt the wrong way round. “That’s pretty good,” he said. “That boy’s trying to tell us something.” Too true, he was. He was trying to tell us, poor lad, that he hadn’t been well taught, that he’d been let down by his school, that he was another victim of theorising educationalists in a mission for search and destroy, he was trying to tell us that his future would be less adequate than it would have been if he’d really been taught to read and write and add up and emerge from school with good qualities and with good manners.

    So whatever our problems in promoting John Patten’s brave policies – and they are the Government’s policies – whatever the problems in promoting John’s brave policies. When you’re criticised for it, remember that teacher, monstrously complacent, proud and happy with self evident failure. What I want for our children in our schools is self-evident success, for that is what is in their interest and in this nation’s interest. We may get the worst of the propaganda war in education, but the Government’s right about education. We are right to have tests to find out what our children learn and what they do not learn. And we are right to expect schools to let parents know how well their children are doing at school, for they have the primary responsibility for them.

    So, let us hope we soon get out of this impasse and back to a sensible approach, working as we wish to with the very best of the education profession. That is our aim and I think that is our responsibility and their responsibility in the interest of the children who are our joint charges as they go through school. And I hope the unions will give up their opposition, that they apparently at the moment want the Government to congratulate inadequacy and garland mediocrity. Well, we can’t do it and we won’t. All John Patten and I want to know – and it is not to ask a great deal – all we want to know, quite dispassionately, is what works and what doesn’t and, when we have that information, we can out it right in the interests of our children, in our schools. We may get things wrong and move on, but those children have only one chance of education at school. And between us, the Government, the trade unions and the teachers, must not let them down.

    I know we’ve been pushing against a great settled glacier of trade unionist conformist mind, an attitude that despises evidence about educational problems, the way it despises most evidence and most knowledge. Knowledge, they seem to think, is bourgeois. Well, Madam Chairman, I define the task and I tell you, big and menacing as it is, we will not give up on this issue. As they used to say on the Left, the struggle continues and for us it will in the interests of our children.

    Madam Chairman, our party’s policies address directly the problems that matter to everyday lives. Always have done. That’s why our party has won and won and won again, because our instincts flow from the innermost instincts of the majority of the British people. We are there in Government to help people meet their ambitions. It has been a difficult year. But that’s yesterday; it’s gone. We’ve learned from that and we’ve moved on. We’re working for what we believe in – free market and private enterprise. Low income tax and private choice. Control of inflation so that never again do we go in supermarkets to peel off the sticker and find the price that was there yesterday before a new price was put on top of it. Modern trades unions. Legislation almost completed, a revolution in trade unionism over the last decade. Good public services. Good public services are not the prerogative of the Left. We say that where services need to be provided by the public, they should be, that they should be efficient in precisely the same way that we would demand efficiency as if they were in the private sector. We want to ensure we maintain a modern, growing Health Service, available irrespective of need to people, irrespective of resources to people whenever they may need it. We want ever higher standards in schools. We want wider personal ownership. We want the private sector to expand, through privatisation where necessary, as far as it credibly can. We want security at home and we want security abroad. And we want to say “no” to something. No to tampering with our constitution. No to breaking up the United Kingdom. And no to proportional representation. PR, that sly deception that delivers governments into the hands of tiny and sometimes extreme political parties, is not a servant of democracy but its very enemy. Madam Chairman, those are the Tory truths, they’re truths that last, they’re truths we care about, they’re truths we’ll fight for and they’re truths that we’ll win with.

  • Mr Major’s Commons Statement on the Economy – 9 June 1993

    Below is the text of Mr Major’s statement to the House of Commons on 9th June 1993 in the Economic Debate.


    PRIME MINISTER:

    The Prime Minister (Mr. John Major) : I beg to move, to leave out from House’ to the end of the Question and to add instead thereof : welcomes the widespread indications of economic recovery in the United Kingdom at a time when many other major economies are in deepening recession ; recognises that the interests of industry are at the heart of the Government’s policy and acknowledges the comprehensive programme of training and employment opportunities for unemployed people that the Government has put in place; welcomes the Government’s commitment to its Manifesto pledges including its commitment to improving the efficiency and effectiveness of public services through the Citizen’s Charter ; deplores the scare-mongering stories about public spending peddled by the Opposition ; and applauds the Government for its determination to maintain low inflation, sound public finances and firm control over total public expenditure upon which a sustainable economic recovery depends.’. As the right hon. and learned Member for Monklands, East (Mr. Smith) sits down, I have little doubt what is in his mind : “That’ll keep John Edmonds quiet for a week or so.”

    Before I turn to the substance of the debate, I wish to say a word or two to my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont) regarding his remarks at the commencement of today’s debate. In his speech, my right hon. Friend spoke of a number of matters of very great importance, including the case that we have discussed on many occasions over the past two years for an independent central bank.

    I share my right hon. Friend’s loathing of inflation. That is an issue that we discussed frequently. We both saw the case for an independent central bank, able to take decisions on the implementation of monetary policy. There is a genuine case for that. I do not dissent from my right hon. Friend’s remarks about it. The very real concern that I have always faced is one that I believe is spread widely across the House : the need for accountability to Parliament for decisions on monetary policy matters. Were a way to be found to get the benefits of an independent central bank without the loss of parliamentary accountability, my views would be very close to those of my right hon. Friend, but I have to say to my right hon. Friend–I believe, from our many discussions, that it is a view he shares– that what is more important than the institutional arrangements is the underlying policy that is actually being followed. On that, I do not believe that an independent central bank would have brought down inflation any more rapidly than we have been able to achieve.That is something for which I am happy to pay tribute to my right hon. Friend.

    Also, I entirely share my right hon. Friend’s vision of the economic goals of this Government and of the difficult path that we have had to follow to achieve and maintain low inflation and restore sustainable growth and employment. My right hon. Friend and I– [Interruption.]

    Madam Speaker : Order. The House must settle down. Hon. Members do not have to listen, but whoever is speaking has to be heard. There is a great distinction between those two statements. The Prime Minister.

    The Prime Minister : My right hon. Friend and I faced crises both before and after September last year. We worked together towards objectives that we shared, and we were always agreed as to our main goals : low inflation, sustainable economic growth, an increase in prosperity for all our people as medium and long-term objectives. I believe that history will look favourably on my right hon. Friend’s economic and financial skills, but a strong Government need political skills as well– [Interruption.] –when leading a democratic society and, in particular, when handling a lively House of Commons with a small majority.

    Dealing with the problems of a small majority is a fundamental fact of democracy that no one dare or should even attempt to overlook. However, as we have shown in the battle over inflation and in our pursuit of European policy, against great difficulties in this House, we were not prepared in the Government to allow short-term difficulties to deflect us from what were the right long-term policies for this country. That was the position, and it is the position.

    I am grateful to my right hon. Friend for his support and help throughout the past two and half difficult years. I acknowledge the difficulties that he has faced and the courage with which he has faced those difficulties, and I accept the support that he has offered to the Government for the future. I welcome the opportunity to debate economic policies at a time when output is up, exports are up, productivity is up, confidence is up and, as announced today, when business starts are up.

    The right hon. and learned Member for Monklands, East has just made the speech that we expected of him. At the end of it, we are no better informed about his economic policies than we were at the beginning of it–or even about whether he has any economic policies or whether he has progressed beyond the sound bites that so frequently construct them. We do know something about the right hon. and learned Gentleman. We know that he is the man who announced the biggest tax increase in peacetime history, just before the general election. He is the man who said confidence would carry on falling, just before the CBI announced the highest level of confidence in 10 years, and he is the man who calls for a debate on the economy just as the economy is recovering. I hope that, with timing like that, the right hon. and learned Gentleman never takes up boxing, because it would be very painful. Many things can be said about him, but “floats like a butterfly, stings like a bee” is clearly not among them.

    What does seem right about the right hon. and learned Gentleman was said by the right hon. Member for Chesterfield (Mr. Benn). I remind the right hon. and learned Gentleman what his right hon. Friend said about him : “I do not think that Members of Labour’s Front Bench would have even two ideas about what to do with the economy if they came to power a series of sound bites glued together and called an economic policy is not an economic policy.”–[ Official Report, 20 May 1993; Vol. 225, c. 420.] That remains as true at the end of the right hon. and learned Gentleman’s speech as it was before.

    Today’s debate goes right to the heart of the fundamental divide between the Conservative party and the Labour party. The Labour party stands for higher public spending, higher taxation and more state interference in business and industry. We stand for controlling public spending, bringing direct taxation down where we can and getting the state off the backs of businesses and individuals. Let me deal with one matter that was fundamental to the right hon. and learned Gentleman’s speech. Let me turn immediately and clearly to social policy. I did not come into politics to dismantle the welfare state. I have no intention of doing so and neither does my party. At the moment, in different parts of the country there are many vulnerable people who are worried. They are worried because the Opposition systematically, day after day, leak after leak, sound bite after sound bite, have sought to frighten them. The Opposition have peddled scare after scare–

    Several hon. Members rose —

    The Prime Minister : I will give way later. The Opposition have peddled the man to spread scare stories; surely not a man to condone scare stories, so let me be charitable to him. Perhaps he did not know–had no idea–when the hon. Member for Livingston (Mr. Cook) swore that we would privatise the national health service, when the right hon. and learned Gentleman must have known that that was untrue. He could not have known about that, because he is an honourable man.

    What did the hon. Member for Holborn and St. Pancras (Mr. Dobson) say? He said that the Government were “threatening to cut pensions and benefits for the worse off.” In the autumn statement 13 days later, pensions and benefits rose. I am sure that the right hon. and learned Gentleman did not know what his hon. Friend would say, because he is an honourable man and would not have sanctioned it.

    It was the right hon. and learned Gentleman’s party that repeatedly claimed that trust hospitals were leaving the health service. They were not : the Labour party knew that they were not, yet it needlessly scared sick people for a vote or two, time after time. The right hon. and learned Gentleman could not have authorised that, because he is an honourable man–or so I had thought. But then I discovered what he had to say : “What’s going on will lead to the privatisation of the NHS.” That was flatly untrue, of course, and another scare. I wonder who could have spread it? The right hon. and learned Gentleman spread it. In the Labour party the scares come from the top and behind that moral righteousness is someone who has no scruples whatever.

    The right hon. and learned Gentleman claims that the Conservative party won the election by telling untruths. Let me remind him about that election. It was his party that published 10 patient case histories and had to withdraw them when it turned out that it had made them up. It was his party that made up untruths about a sick little girl and spread them across the country. That is the party that dares to talk to us about standards. There is a word for that, but it is not parliamentary.

    Let me turn to the subject of public spending. The Government know that, if the economy is to grow, the tax man cannot take more of the proceeds than the country can afford. In the Conservative party, we understand that people want more money in their own pockets and do not want the Government to spend their money for them. Of course, in the recession, spending had to increase. I do not apologise for that increase in spending–it was necessary in the recession and it was necessary to protect the vulnerable. I saw no support from Labour Members for any expenditure reductions throughout the recession and every support for dramatic increases week after week from every Member of the Opposition parties.

    Mr. Calum Macdonald (Western Isles) : Will the Prime Minister give way?

    The Prime Minister : Later. During that recession, not only did expenditure necessarily rise but income necessarily fell and that added to the borrowing requirement. Even though a great deal of that will reverse as growth returns, it is going to take time. That is why we have embarked on the public spending review. Governments have to take difficult decisions. We have to face structural increases in public spending, as any Government would. There are demographic changes, changes in student numbers and more elderly people, especially the very old. As we address those problems, the Opposition gaily spread mischief–a little fib here, a little scare there–yet as it does so it is carrying out a review into social expenditure. It does not have the courage to do it directly ; it has farmed it out to the commission on social policy. The only form of contracting out that the Labour party approves of is contracting out difficult decisions to other people.

    The right hon. and learned Gentleman cannot run away from what he said : “We” –that is, the Labour party– “should be prepared to re-examine everything. I have not ruled anything out”. That is its position on social policy and Labour Members nod in agreement. Daily, the Labour party invites us to rule things out, while it examines everything–pensions, child benefit and every other aspect of social policy.

    How responsible the right hon. and learned Gentleman is. I suppose that that comment shows that he wants to grapple with real problems, but when he faces other audiences, he wants to rule everything out. Which is the real right hon. and learned Gentleman? The gritty, determined facer of problems who wants to examine everything where nothing is ruled out, or the wriggler, twisting and turning, saying one thing to one audience and another thing to another audience?

    Mr. John Garrett (Norwich, South) : Could the Prime Minister, First Lord of the Treasury, tell us what he was doing during the long period of recession, which has caused so much misery throughout the country? Was he looking the other way? Was he train spotting? Was he walking into cupboards? Has there ever been a more wimpish approach to the problems that face this country than that which he has shown?

    The Prime Minister : I shall tell the hon. Gentleman directly : we have been presiding over a policy that brought inflation down to 1.3 per cent. and interest rates down to 6 per cent. so that this country is now poised for the largest growth in the European Community this year, next year and probably for the years beyond that. We have been taking the long- term view, not the short-term, option. That is what we have been doing–I am grateful to the hon. Gentleman for giving me the opportunity to point that out–while he has opposed every policy that has brought down inflation and interest rates.

    The Opposition will be glad to know that our review of public spending will be careful and thorough. There will be two criteria : are any changes fair, and are vulnerable people protected? When the answer is no, we shall not make the changes. When the answer is yes, we shall set out to the House the implications of those changes. There are no soft options. The Government’s duty is to examine them all and pick the right ones. We know that we need to reduce public borrowing, which is why, in the last Budget, we decided that some increase in revenue was necessary.

    We decided to introduce value added tax on fuel and power, not least because it would help meet our Rio commitments, commitments that the Opposition urged us to extend. We had every reason to expect cross-party support. The Liberal Democrats had stated in their green paper : “Liberal Democrats advocate as a first priority the imposition of a tax on energy The UK is unusual amongst EC members in not applying even standard rates of VAT on domestic fuels we would press forward by ending the anomalous zero rate of VAT on fuel”. Where were those men of principle in the Division Lobbies after the Budget?

    What did the Labour party say? It said : “Zero rating on items such as food, fares, books and children’s clothing should remain as an essential part of the VAT system.” That was quite clear. It continued : “We will also use the tax system, as well as regulation, to help protect the environment.” That can mean only one thing. In the list of zero-rated items, there is no reference to zero rating for domestic fuel. The Opposition intended to put it up, and they know it. If they did not, will they tell me now why it was not in their list of zero-rated items? The right hon. and learned Member for Monklands, East does not answer–no doubt, as a QC, he believes in the right to silence for an accused.

    When we introduced VAT on fuel and power, we made it clear that there would be extra help for less well-off pensioners and others on low incomes. I am glad to repeat that commitment. In recent months, the right hon. and learned Gentleman has made a great deal of the VAT increase, as have his hon. Friends.

    Ms Harriet Harman (Peckham) : So have the voters.

    The Prime Minister : So did the voters, says the right hon. Lady. What the right hon. and learned Gentleman did not mention is that he was the Energy Minister who let electricity prices rise. What was the increase–5 per cent., 10 per cent., 15 per cent.? No, it was 30 per cent. over and above inflation.What did the right hon. and learned Gentleman do to help the less well-off? I shall tell the House what he did–absolutely nothing. The position is clear. The right hon. and learned Gentleman cares about pensioners when he is in opposition–how he cares about pensioners in opposition–but in government he disregards them absolutely. One may think that that was a single lapse but, in case anybody thinks that that is so, let me say that the right hon. and learned Gentleman was a member of the Government who twice held back the Christmas bonus and cut capital spending on the health service. That is his record, and he should be ashamed of it.

    There is another case where the right hon. and learned Gentleman’s actions do not match his words. Today, he again attacked our borrowing levels, but his election promises would have put up borrowing way above the present level. He is still at it. “Let’s spend £6 billion of capital receipts,” says the right hon. and learned Gentleman. “Let’s spend an extra £1.5 billion on public sector pay.” The shadow Chancellor says, “Let’s renegotiate our rebate and pay more to the European Community.”

    Is there any area of Government spending that the Opposition are prepared to cut? Perhaps the shadow Chancellor can tell us. Perhaps we could have another sound bite to tell us where he would find the necessary savings. Or perhaps the deputy leader of the Labour party can tell us; after all, she came into government to implement the cuts in education that her hon. Friend the Member for Eccles (Miss Lestor) refused to make.

    Mr. Geoffrey Dickens (Littleborough and Saddleworth) : Will my right hon. Friend explain why, if the Opposition are sincerely worried about the disadvantaged people of this country, they demand more and more overseas aid, day in, day out? [Interruption.]

    Madam Speaker : Order. We all like a little bit of fun and hilarity, but we also want to hear the Prime Minister.

    The Prime Minister : The fundamental point about overseas aid is that, in order to sustain it as the Government have done, one needs to pursue the right economic policies, as we have also done. I am glad that the motion mentions manifesto promises–glad, but a little surprised because the right hon. and learned Gentleman has scrapped all his election promises. We stand by our manifesto policies. We promised action on trade unions, housing, lotteries, railways, education and asylum, and we have kept our promises. Bills on each of those matters have already passed through the House. We promised to uprate pensions and benefits, and we have done so. We promised to maintain child benefit, and we have done so. We promised to increase real resources for the health service, and we have done so; year on year, spending is at record levels. They are the promises we made, and we have kept each one.

    Mr. John Fraser (Norwood) : When the Prime Minister went on his trip down memory lane to Brixton and other ethnic areas, did he tell the people that he was going to take away the right of appeal for visitors?

    The Prime Minister : The hon. Gentleman knows as well as any hon. Member that the great improvement in race relations in this country is directly related to the firm but fair immigration policies pursued by this Government. I am surprised to hear him venture down that track, in view of his record of favouring good race relations. We promised to deliver low inflation, and we have delivered on that promise. We promised to resume economic growth, and it is now resuming. Inflation, at 1.3 per cent., is at the lowest level for 30 years. Interest rates, at 6 per cent., are the lowest in the Community. There are now too many signs of recovery for even the Opposition to ignore them. Manufacturing output has increased for months in succession and unemployment has fallen three months in a row. It is too high–I share that view–but it is moving in the right direction, and sooner than most people expected.

    It is certainly sooner than the hon. Member for Dunfermline, East (Mr. Brown) expected, because, after the Budget, he said : “I make one Budget forecast–that, after the Budget, unemployment will rise this month, next month and for months afterwards”.–[ Official Report, 17 March 1993 ; Vol. 221, c. 289.] One day later, unemployment fell. The next month, it fell again, and the next month, it fell again. Another sound bite is needed, I think. The recession has been damaging, and recovery has not come easily, but it is now under way– [Interruption.]

    Madam Speaker : Order. Hon. Members must come to order. The bawling and shouting coming from the Back Benches this afternoon is utterly disgraceful. [Interruption.] I know who the Members responsible are, and I need no one to point them out for me.

    The Prime Minister : Some time ago, the right hon. and learned Member for Monklands, East admitted : “we change our policies as we move towards a different election, we’d be a very foolish Party if we went into an election in 1995-96 with exactly the same policies”. That is certainly true. But whose policies were they? They were the right hon. and learned Gentleman’s. He was the undisputed author of Labour’s defeat. He was the man who drew up the disastrous shadow Budget. Hon. Members may remember the hype, the fake presentation, as if it were a real Budget, and the responsible tone–the right hon. and learned Gentleman even posed for photographs outside the Treasury. Lots of passers-by do that, but they never get into the Treasury. The right hon. and learned Gentleman talks of broken promises, as does the shadow Chancellor, the hon. Member for Dunfermline, East. That is a good sound bite, but for the wrong party. The Labour party has broken every promise that it made about future policy at the election. Every one has gone to the social justice commission. The right hon. and learned Gentleman said : “We must be prepared to examine in an open-minded way some of the fundamental features of our approach. What is the right balance between universal and selective benefits”.

    It was not Milton Friedman who said that, nor my right hon. Friend the Chief Secretary, nor even Lord Desai–no doubt he would have been sacked if he had said it. The right hon. and learned Member for Monklands, East himself said it. Yet time after time he accuses us of examining aspects of public expenditure that any responsible Government would need to examine. He is the man who said that his planned increases in pensions and child benefits were essential, and that his tax proposals were fair, reasonable and popular. They have been so popular that he has dropped them all. So much for his promises. I would rather listen to the late Robert Maxwell on pension probity than to the right hon. and learned Gentleman.

    I know that the exchange rate mechanism and economic and monetary union are matters of some importance to hon. Members on both sides of the House. Since we left the ERM, there has been substantial debate about monetary policy and the possibility of economic and monetary union. In the negotiations at Maastricht I sought and secured an opt-out on the single currency because I was sceptical of its economic impact across Europe and its artificial deadlines, and because I believed that such a decision was for the House to make. Since then, economic developments in the European Community have strengthened the reasons for caution that I set out. The European Community economies have diverged rather than converged. As we come out of recession, our main partners are heading into a recession. Some of our European partners remain keen on early monetary union, although many of their central banks are less keen. Even the keenest must now see the difficulties. The criteria for monetary union will simply not be met. When I was negotiating at Maastricht, the idea of a monetary union in 1997 looked ambitious, perhaps even a little dubious. I have to tell the House that it looks wholly unrealistic today.

    The economies of Europe are not remotely ready for one currency throughout the 12, soon to be 16, countries, and I believe that they will not be ready –if they ever will be–for many years. That is not an anti-European view; I simply do not believe that the economic circumstances will be right, and if they are not right the damage that proceeding would cause the Community would be profound, and I should not wish to see it occur. If some of our partners decided to go ahead prematurely, that would be an economic mistake. I do not believe that we should go with them.

    We have sought reform of the exchange rate mechanism. I make no secret of the fact that I prefer stable exchange rates, and so does industry. But I cannot accept that the present operation of the ERM is satisfactory. Sterling was forced out, in the circumstances described by my right hon. Friend the Member for Kingston upon Thames, but so was the lira. The franc, the peseta, the escudo, the punt and others have at different times been put under great pressure. Certainly, I could not recommend that sterling return at present. We should need greater convergence between the monetary policies appropriate for all the Community economies, and we should need to be satisfied that the system would be operated to the benefit of all its members.

    In January, I made it clear that those circumstances would not apply this year. I now doubt whether they will apply for some years ahead–possibly they will not apply in this Parliament.

    Sir Peter Tapsell (East Lindsey) : There will be a widespread welcome throughout the party for what my right hon. Friend has just said to the House, and there will be great support for the policies that he has enunciated throughout his speech.

    The Prime Minister : I am grateful to my hon. Friend, and delighted to have a party at ease with itself. It is clear that the Labour party has no policies at all, and certainly no economic policies. When it had policies, they lost it the election. As the hon. Member for Brent, East (Mr. Livingstone) put it–rather cruelly, I thought–the right hon. and learned Member for Monklands, East “bears the primary responsibility for tax and economic policies that lost Labour the election.”

    And now Labour has none. That is not my view alone. It is clearly shared by Mr. Edmonds of the GMB, the union that sponsors the Leader of the Opposition–or at least, it sponsored him until last Sunday. I am not sure whether things have changed since then. Mr. Edmonds says that Labour has an identity problem and asks whether the voters “know what Labour stands for”. He says that Labour must shake itself out of its lethargy. He asks : “Where was the Labour movement” during the past few months? He may well ask.

    The Labour leadership cannot have been examining economic policy, because the shadow Chancellor would not recognise economic policy if it gripped him by the windpipe. The Labour leadership may have been absorbed in its falling membership, or it may have been trying to fight off the defeat of the right hon. and learned Gentleman’s party reforms. There is one area of total agreement between the right hon. and learned Gentleman and myself : he wants one man, one vote–a novel concept for Labour. He is right about that, and he has my support. Unfortunately, he does not have Mr John Edmonds’ support. Mr. Edmonds wants one member, one vote, so long as he can be the member and he, and nobody else, can exercise the vote.

    So long as the Labour party remains subordinate to the trade unions in policy, a paid for and wholly owned subsidiary of the trade unions, Labour Members will sit on that side of the Chamber. I shall tell the right hon. and learned Member for Monklands, East why he and his party fail to convince even the leader of the union that sponsors him. It is because Labour is a party without policies and without principles that it will remain, in the short and the long term, a party without power.

  • PMQT – 8 June 1993

    Below is the text of Prime Minister’s Question Time from 8th June 1993.


    PRIME MINISTER:

     

    Engagements

    Q1. Mr. McKelvey : To ask the Prime Minister if he will list his official engagements for Tuesday 8 June.

    The Prime Minister (Mr. John Major) : This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

    Mr. McKelvey : Did the Prime Minister have an opportunity in the course of his very busy day yesterday to have a look at Scotland’s national newspaper, the Daily Record, which carried an article stating that the former Chancellor claims that the Prime Minister, and the Prime Minister alone, was responsible for imposing VAT on fuel? Did he impose it on his own ; and will he answer without waffle?

    The Prime Minister : The answer to the first part of the hon. Gentleman’s question is that in the course of my busy day I certainly did not read the Daily Record. The answer to his second point is that the House of Commons imposed the VAT by its vote.

    Mr. John Carlisle : Is my right hon. Friend aware that a head teacher of a school near my constituency, having received a salary increase that had been denied to several thousand other citizens, wrote to the Secretary of State for Education telling him that he could stuff his pay rise? If head teachers take that attitude and use that sort of language, is it any surprise that they are denying 14-year olds school tests which they themselves would probably fail?

    The Prime Minister : That is an unusual position to adopt on pay rises and not one generally taken by head teachers or by anyone else. I very much regret that there is difficulty carrying these tests forward. They are very much in the interests of the children and it is in the interests of the testing system, which the head teachers support, that the tests should go ahead this year so that Sir Ron Dearing can deal with the difficulties with them.

    Mr. John Smith : Can the Prime Minister tell the House why Ministers in his Administration have seen it as part of their duty as Ministers of the Crown to intervene on behalf of Mr. Asil Nadir, a person charged with serious offences and now a fugitive from justice?

    The Prime Minister : I am glad that the right hon. and learned Gentleman has given me the opportunity to correct a misassumption in his mind. My hon. Friend the Minister of State, Northern Ireland Office has explained that he raised certain matters with the Attorney-General following an approach from a constituent of his who was then an adviser to Mr. Nadir. My hon. Friend was originally approached 18 months ago, before he became a Minister, and it is perfectly proper within the “Questions of Procedures for Ministers” that Ministers are free to make their views about constituency matters known to the responsible Minister, either by interview or in correspondence. As I understand it, that is what my hon. Friend did.

    Mr. John Smith : Can the Prime Minister confirm that Mr. Nadir is not and was not a constituent of either the hon. Member for East Hampshire (Mr. Mates) or the President of the Board of Trade? Is not it strange that a man charged with serious offences should be considered so important that Ministers make personal approaches on his behalf to the Attorney-General, who is responsible for his prosecution?

    The Prime Minister : No doubt in the hubbub, the right hon. and learned Gentleman did not hear what I said to him. I made it clear that my hon. Friend approached the Attorney-General–following an approach from a constituent who was then an adviser to Mr. Nadir–18 months ago. That was entirely proper. Let me equally make it clear– [Interruption.]

    Madam Speaker : Order. The House must come to order and hear both questions and answers.

    The Prime Minister : Let me equally make it clear to the right hon. and learned Gentleman, so that there is no misunderstanding, that I am assured by my hon. Friend that he has had no financial involvement with Mr. Nadir, his companies or his advisers, either before he became a Minister or since. I hope that the right hon. and learned Gentleman will accept that.

    Mr. John Smith : Will the Prime Minister tell us whether he thinks it was appropriate behaviour for a Minister to give a watch to Mr. Nadir inscribed with a very supportive inscription, to put it mildly? Does the Prime Minister think that that is the way that he wants Ministers in his Administration to behave? Was not it bound to undermine the work of the Serious Fraud Office in pursuing financial crime? Is not it the case, as the country clearly understands, that this is a shoddy, unseemly affair that does no credit to this Administration?

    The Prime Minister : I can certainly agree with the right hon. and learned Gentleman that it was unwise. I think that that is the view taken by my hon. Friend and he has said so in public. I know my hon. Friend recognises that, with hindsight, it would have been better if he had not done it. It was a misjudgment, but it is not a hanging offence.

    Sir Dudley Smith : In view of the experiences of many Warwickshire residents over recent months, particularly in my constituency area, is my right hon. Friend aware that they are looking to him to introduce good and effective legislation to curb the so-called new age travellers? Will he tell us what urgency he is applying to that particular problem?

    The Prime Minister : My hon. Friend raises a problem which has been faced in many parts of the country. It is one that I hope and believe we will be able to deal with in the next Session of Parliament.

     

    Q2. Mr. Khabra : To ask the Prime Minister if he will list his official engagements for Tuesday 8 June.

    The Prime Minister : I refer the hon. Gentleman to the reply I gave a few moments ago.

    Mr. Khabra : Will the Prime Minister personally condemn the speech made by the hon. Member for Davyhulme (Mr. Churchill)? It has done a great deal of damage to good race relations in this country and it has also encouraged the fascists and racists to indulge in destructive activities. I hope that the Prime Minister will be able to give a positive answer to the community.

    The Prime Minister : Neither of the epithets used by the hon. Gentleman applies to my hon. Friend and I hope that he will recognise that. I have not read all the speech to which the hon. Gentleman refers, but I have read some of the reports of it, which I understand were not accurate. On the day that it was published it did not represent my views or those of the Government. My commitment and that of the Government to good race relations is well known. I welcome without reservation the positive contributions which all communities make to life in this country and, as long as we maintain firm but fair immigration controls and refuse to tolerate racial discrimination, we shall keep the race relations which have been steadily improving over recent years, much to my pleasure. I hope and expect them to continue to improve.

     

    Economy

    Q3. Mr. Thurnham : To ask the Prime Minister what representations he has received about the state of the economy; and if he will make a statement.

    The Prime Minister : I have received a number of representations on the economy. There is growing evidence that recovery is under way across a broad front.

    Mr. Thurnham : Will my right hon. Friend praise north-west exporters such as Rotocold in my constituency, which has gained record export sales and cut local unemployment to below the national average? Is not that in stark contrast to the failed union-dominated policies of the Labour party, which saw unemployment in the north-west double between 1974 and 1979?

    The Prime Minister : That is true. Unemployment is always a tragedy when it occurs and it has occurred under every Labour Government we have seen in this country. I am happy to join my hon. Friend in congratulating the company in his constituency. It is good news. I understand that it has had more export orders recently and that will add to jobs in the region. There is no doubt that British manufacturing industry is now exporting at record levels and I welcome that. It is not unrelated to the fact that we now have policies of low inflation, low business taxation and trade union reform which have removed many of the difficulties in management that so bedevilled firms in the 1960s and 1970s.

     

    Engagements

    Q4. Mr. Byers : To ask the Prime Minister if he will list his official engagements for Tuesday 8 June.

    The Prime Minister : I refer the hon. Member to the answer I gave some moments ago.

    Mr. Byers : Will the Prime Minister say whether he wishes to see shipbuilding continue on Tyneside? If he does, will he confirm that the Royal Navy work presently at Swan Hunter will be completed there and that full Government backing will be given in order to secure vital export orders? Is the Prime Minister aware that if his Government stand to one side and do nothing, we shall witness the death of shipbuilding on Tyneside and the loss of thousands of jobs as a result?

    The Prime Minister : I know of the hon. Gentleman’s concerns about Swan Hunter, which are shared by the hon. Member for Newcastle upon Tyne, East (Mr. Brown) and my hon. Friend the Member for Tynemouth (Mr. Trotter), all of whom have made representations to me about it in recent weeks. I cannot confirm the details that the hon. Gentleman seeks today, but I hope that the firm will be able to put itself in a position in which it will be able to continue. That depends on its being able to obtain and produce orders at a price that the market will pay.

    Sir Teddy Taylor : As one of the most helpful means of helping the growing army of unemployed in Europe would be to conclude the GATT discussions and as the Prime Minister has played such a positive and helpful role in that, will he explain to the country why the EC is being so difficult about concluding those discussions? It could bring down unemployment and put people throughout Europe back to work.

    The Prime Minister : I think that I have some news that my hon. Friend will undoubtedly welcome. I understand that the French Minister for European Affairs has announced at today’s meeting of the Foreign Affairs Council that France will be accepting the agreement on oil seeds, signed between the European Community and the United States last November. It is an issue which I discussed at my two meetings with the French Prime Minister last month. I am delighted at the decision that has been made. I hope that it will enable the Community to go forward to other agreements relating to the Uruguay round. Although that is a separate issue from the oil seeds agreement, such an agreement was a necessary preliminary. It now removes one of the road blocks to a comprehensive GATT agreement.

     

    Q5. Mr. Beith : To ask the Prime Minister if he will list his official engagements for Tuesday 8 June.

    The Prime Minister : I refer the right hon. Member to the answer I gave some moments ago.

    Mr. Beith : Is the Prime Minister beginning to regret that his reshuffle a couple of weeks ago was not more extensive and did not see the departure of Ministers responsible for education, shipbuilding and undue and extensive assistance to those who give large donations to the Conservative party? Does he realise that it is likely that the next reshuffle will involve himself?

    The Prime Minister : The answer to the substantive part of the right hon. Gentleman’s question is no.

     

    Q6. Mrs. Lait : To ask the Prime Minister if he will list his official engagements for Tuesday 8 June.

    The Prime Minister : I refer my hon. Friend to the answer I gave some moments ago.

    Mrs. Lait : Will my right hon. Friend remind trade unionists that the hard-won democracy that they have achieved over the past 14 years is thanks to Conservative legislation? Will he tell them that only the Conservative party not only believes in but has legislated for one member, one vote?

    The Prime Minister : It is certainly the case that we have more luck with trade union reform than the right hon. and learned Member for Monklands, East (Mr. Smith) does.

    Throughout the 1980s the right hon. and learned Gentleman voted against each and every one of our reforms to strengthen the rights of individual trade union members and the Labour party still wants to oppose rights for individual trade union members. While Labour Members continue to hold those views we will continue to sit on this side of the House.

    Mr. Hume : Given that this generation is going through the greatest economic revolution in the history of the world–the technological, telecommunications and transport revolutions–and that the wealth of society is being created by fewer people, does the Prime Minister agree that, logically, the state should be taking a greater role in the welfare of people instead of moving in the opposite direction towards the survival of the fittest and the law of the jungle? Given that they have already privatised heat and light, is there any truth in the rumour that the Government are about to privatise fresh air?

    The Prime Minister : I have news for the hon. Gentleman. It is not owned by the Government and does not need privatisation.

    Mr. Hume : What about water?

    The Prime Minister : On his earlier point, the hon. Gentleman clearly overlooked the 67 per cent. real terms increase in social security, the additional uprating next year of £2.5 billion, the extra expenditure on benefits of 40 per cent., the exemption for people who cannot pay council tax, the fact that the Government, unlike our Labour predecessors, continue to pay the pensioners’ bonus and the increase in consumer goods for the bottom 10 per cent. of the income scale. Those changes were made under this Government because of our economic success and social concerns.

  • Mr Major’s Speech to the Conservative Party Women’s Conference – 4 June 1993

    Below is the text of Mr Major’s speech to the Conservative Party Women’s Conference, held in London on 4th June 1993.


    PRIME MINISTER:

    Madam Chairman, it is over 30 years since I joined the Conservative Party.

    I still recall why. Because it was the Party of the individual.

    The Party of the family. It offered choice. It spoke about how people could better what they had.

    How each of us could have more control over our own lives. Build up something more – then leave it to our children. They are simple enough objectives. They are what I believe in. What we all believe in.

    We stand for them as strongly today as we ever did. Individual liberty in everyday matters. That is fundamental to a free society. But that is not the only appeal of our Party.

    We help each generation lay the groundwork for the next. We keep our roots in the past, but we plan far into the future.

    And we have persistence. What we start out we complete – however tough the prospects may look.

    But, Madam Chairman, I don’t need to tell you that. Just remember the last Election. Win it? Many people were telling you that we hadn’t a cat in hell’s chance.

    It would have been easy to give up then – but we didn’t. We didn’t do it then. We haven’t done it since. And, Madam Chairman, we’re not going to do it now. I know it’s not been easy for Conservative supporters. It’s easy to wear the blue rosette the day after an Election win. But it’s not so easy to lift hopes and hearts when things have been difficult.

    But that’s what you all do. That’s what you did last March and April. That’s what you’ve been doing these last few months. And I know how much I owe you.

    Madam Chairman, these have been difficult times for Britain, but things are looking up here now. And don’t let’s forget – as some people too often do. Look around Europe.

    In France, in Germany, in Spain, in Italy – wherever you look – things are worse than they are in Britain. Higher interest rates. Higher inflation. And economies that are shrinking. In Britain the position is changing. We are now out of recession and returning to growth.

    Inflation has fallen: down from around 11 per cent to under 2 per cent.

    Interest rates: down from 15 per cent to 6 per cent.

    Exports: soaring.

    Manufacturing: beginning to re-employ again.

    Over 1000 new businesses are started every day.

    Unemployment has fallen over the last three months and job vacancies have risen.

    Britain is now back into growth. And that is the way to get Britons back into work. Of course we still face problems ahead. As a Nation we are borrowing too much. That is almost inevitable in a recession. The Government’s income falls – fewer people in work means less income tax. Less spending means less VAT and excise duties. Fewer home sales means less Stamp Duty.

    But it is not only that income falls in a recession expenditure increases. Social costs increase to protect the unemployed and others facing difficulty.This too, worsens the public finances. But I know of no Conservative Government that would abandon the vulnerable in a recession.

    Quite simply, that is not our way. So, income down, expenditure up. That is one of the main reasons we are borrowing too much.

    A good deal of our deficit will automatically disappear as we return to growth – the mirror image of what has happened over the last three years.

    In the Budget we set out a clear strategy for raising revenue over the next 3 years. The main task now is to keep a firm grip on public spending to help bring the books back towards balance.

    We must look across Government to see where savings can be made. As we do so we will not forget our Manifesto promises. We will not forget our commitment to the vulnerable – and especially the elderly. Nor will we forget our instincts and priorities as Conservatives.

    Over the next few months you can expect a whole crop of scare stories. Our opponents will be unscrupulous in their willingness to frighten anyone and everyone if they believe it will frighten them into their political camp.

    We have seen it all over the last two years.

    ‘The Government will privatise the Health Service.’ Remember that scare? Untrue.

    ‘The rural Post Office network will close.’ Untrue.

    ‘Pensioners won’t be able to collect their pensions from the Post Office.’ Untrue.

    Three wrongs that were not right. And there’ll be more.

    Be warned. Our opponents will scare and scare and scare again.

    What they will not do is address the reality that – in the interests of the country – we must put the finances in order.

    We have to take a good hard look at public spending – quite apart from the financial pressures of recession.

    Let me tell you why.

    More of our young people are going into further education. We want to encourage that – but it’s very expensive.

    More people are living longer. We want to provide them with the care they deserve – but it’s very expensive.

    Britain needs a modern industrial economy. So our young people need more and better training – but it’s very expensive.

    All are important. But we can’t pile cost upon cost. We have to pick our priorities. More spending somewhere means more savings somewhere else. I know it will be unpopular in the area where savings are found. But – if we are to do what is right for the country – we must do it.

    I believe the British public will understand this.

    They know you can’t spend what you don’t have.

    And all of us have to take that message – uncomfortable as it is – to every constituency in the land.

    Some areas of public expenditure will continue to grow – year by year. We must answer the question – how are we going to meet rising needs without ever higher taxation? I believe the answer lies in policies that will sustain the recovery – low taxes on larger profits and more incomes.

    Madam Chairman, I want our country to be economically powerful again. To build up its industrial and commercial strength. The economic conditions are in place. Now we need to shape policy so that it supports business and allows it to grow.

    Only growth will provide jobs, yield taxes, invade foreign markets, replace foreign imports and boost our prosperity.

    Madam Chairman, I believe the Government does have a role to help industry. It has a responsibility to shape the economy; to keep taxes as low as possible and to produce economic conditions that favour investment. But it can do more than that.

    It can curb unnecessary regulation. And we will do that.

    It can stop costs being loaded on British companies by unnecessary action in Brussels. And we will do that.

    It can help exporters to win in overseas markets with strong support and the full use of British political influence abroad. And we will do that.

    It can produce the reforms that help industry.

    The trade union reforms. The education reforms. The training reforms. And we will do that.

    The economic conditions are in place for growth. Slowly, but certainly, confidence is coming back.

    Confidence to encourage investment.

    Confidence to expand.

    Confidence in our economic prospects.

    That confidence will ripple through the economy – from the greatest companies to the village shop.

    And the sooner it does that, the better it will be for everyone.

    We are now at a turning point. The recession is slipping behind us. Steady growth lies in front of us. And if the OECD and European forecasters are correct, next year Britain will grow faster than any of the leading EC countries.

    They are saying it abroad. So let’s hear it at home. It is time to stop knocking Britain. It is time to talk Britain up – and talk Britons back into work. And it is also time to protect Britain from well-meaning but damaging legislation.

    At Maastricht I refused to accept the Social Chapter. Not because I want to damage workers’ rights. But because I don’t think that being priced out of a job and being made unemployed is much of a right. The Social Chapter loads costs on employers and will cost jobs for employees.

    Throughout Europe over 17 million people are unemployed.

    All Europe competes with the US, Japan, and the Pacific Basin. But if Europe piles costs on itself, it will not be able to compete – and unemployment will rise across the Community.

    Earlier this week, under the provisions of the Single European Act, our European partners were able to agree a directive by a qualified majority vote that tries to change British working practices. I believe their proposals are folly.

    In any event that should be a decision for this country. It should not be a decision made in Europe. So we will fight it politically. And we will take our case to court. Our partners have also proposed the establishment of works’ councils. Let me tell them now. They are wasting their time.

    They need unanimous agreement for that – and Britain will not give it. We have a veto on this issue. And we will use it. But let us not forget that Europe is changing.

    Today’s European agenda is not about federalism, still less about some fanciful “superstate”.

    It is about making Europe competitive; securing a GATT agreement; stimulating growth and jobs building up the single market.

    About decreasing regulation and increasing national decision- making.

    About bringing new members into the Community, and building up links with Eastern Europe.

    These are the realities of life in the Community today. They reflect our ideas. They are good for Europe. And, Madam Chairman, they are good for Britain.

    Madam Chairman, over the last few days I have had the opportunity of reading your paper on crime. It comes at a good moment. Three weeks ago – at the Scottish Conference at Edinburgh – we heard from a very brave woman who spoke about being the victim of a violent crime.

    It was a harrowing account delivered with great dignity. The chances of being a victim may – statistically – be remote. But fear of crime is not remote. It is all too real to too many people. People living on their own. Women. Pensioners. And people living isolated lives in our big city estates.

    That fear limits freedom blights lives and corrodes society.

    How many people here, when they get into the car, press the central locking with their elbow before they drive off?

    Quite a lot, I bet. Across the country millions do. I’ve seen my own family do it.

    How many women think twice before venturing out into their own town or city in the evening?

    We really shouldn’t have to give that a second thought. It cannot be right that people feel so insecure.

    Madam Chairman, we intend to respond to those fears. Of course, we will give the police and courts the powers and support they need to fight crime on our behalf. We are doing that. But that’s only half the equation. The police and the courts can’t do the job on their own.

    The fight against crime – if it is to be successful – must involve us all.

    Parliament can’t solve crime with legislation. Governments can’t solve it just with expenditure.

    Both have a part to play – but it is only a part.

    If we are to have a successful long-term crusade against crime we have to change the general attitude to crime.

    We must end the all too easy tolerance of petty crime – because it breeds an appetite for more serious crime.

    We need to encourage self-discipline. And we need the help of the public.

    Some months ago I said of crime: ‘We must understand a little less, condemn a little more.’

    Some people were outraged. But I wouldn’t change a word of that view.

    If we understand too much we condone.

    If we condone we encourage.

    If we encourage we will not bring down crime.

    In understanding crime you can, literally, kill with kindness.

    Our long-term battle against crime must start in the home.

    We need to teach our children the difference between right and wrong while they’re young. Children need rules. To be shown that life on the right side of the law offers so much more than life on the wrong side. Violence is not a routine part of life. And it should never be portrayed on our videos or television screens as if it were.

    We don’t want our children saturated by violence. We want them to grow up appalled by it.

    Madam Chairman, we will not shrink from taking any necessary steps to combat crime.

    In this session of Parliament we will be taking the action you asked for.

    We will be giving the courts the powers they need.

    Cracking down on arrogant criminals who ask for bail, get it and then commit crime all over again.

    We will be extending the maximum penalties for drunk and dangerous driving.

    And we will let courts take previous convictions into account when passing sentence.

    Madam Chairman, that is just the beginning of the changes to come.

    Next year Michael Howard will make the battle against crime the centre-piece of our legislation.

    We’ll be acting on criminal justice.

    And we’ll be acting to strengthen and to modernise the police.

    We will be developing new institutions for young offenders – so that they’re where they belong – off the streets.

    We will be tackling those so-called ravers, squatters and new age travellers, who treat other people’s property as if it were the municipal rubbish dump.

    And, yes, we will be clamping down more comprehensively than ever before on fraud in the social security system.

    If there are to be cuts in expenditure, let the first cut be fraud.

    We will also reform the police. We have the men and women we need – but all too often they are having to spend time sitting in offices filling in forms.

    We want them out of offices, catching those who have form. That’s what our new plans are about. That’s what we want.

    And isn’t that what the people of this country want too?

    Madam Chairman, the whole country will agree we need to tackle crime. But they won’t all agree about tackling some of the other problems in front of us.

    I know what many of our supporters are saying. ‘Why can’t they leave well alone? Why are they always changing things?’ I understand that. No one likes change for its own sake.

    That’s normal; that’s Conservative. It’s an everyday instinct.

    And it’s my instinct, too.

    But when I see something wrong then, yes, I do want to change it. To change it for the better – and change it for good.

    Continuity and change weave together into the living tradition of modern Conservatism.

    Continuity of institutions is the bedrock upon which we can make changes elsewhere.

    Above all, there is the continuity of the Monarchy.

    Forty years ago this week, the nation celebrated the coronation of our Queen. Millions lined the streets and millions watched on flickering black and white televisions. I know that I did.

    Britain is a constitutional monarchy. And I for one hope and believe it always will be.

    The Church, the State, Parliament – all help provide solid anchors for our way of life.

    So does our language – the richest in the world. So does our evolving way of life in town and village that provides a comforting mixture of the old, the familiar, and the new.

    These are lasting things, living things that evolve and do not change dramatically. And nor would we want them to. Yet, at the same time, we enforce change elsewhere.

    We promote it. We deliver it. But only where necessary.

    Not change for change’s sake.

    Madam Chairman, one area we do need change is education.

    I’ll tell you why. A third of those going on to training courses needed remedial help with English. Two in every five need basic help with numbers to get through their courses. One adult in six has problems with skills which can be tackled by a well-taught 9-year old.

    Yet, Madam Chairman, how can this be?

    How can this be when we are spending more public money per pupil than ever. Half as much again as we spent in 1979?

    Something is clearly wrong.

    Yet that is the reality in some classrooms.

    I don’t regard these bad results just as statistics. They tell us about children who don’t reach their potential.

    About opportunities lost.

    They tell us something too about the effect of lack of discipline.

    About the blind eye turned to truancy.

    Madam Chairman, that does mean change.

    To opt for the quiet life in education would be to accept the second-rate. Frankly, we’re not prepared to do that. For the worm is in the apple. And it’s time to face this problem square on.

    That does not mean we want a battle with teachers. We do not. We want to work with teachers.

    Few jobs carry greater responsibility than that of the teacher.

    The future of our country is shaped in our schools.

    The prospects for millions of lives are determined there.

    The overwhelming majority of teachers are dedicated and able – and we must help them.

    I am determined to see the high professional standing of teachers restored.

    That is why two years ago I gave teachers a Review Body on pay – to emphasise their professionalism and importance.

    I want teachers who are working day after day to help their pupils to know that the Government will support them.

    And I want them to know something else.

    Some of the tests are too bureaucratic. And I want them slimmed down.

    We are going to take some of the burden off their backs. It crept in – and we must remove it.

    There is strong support for a national curriculum in schools. We want to see greater emphasis on the basics. So, I believe, do parents.

    That’s why we must monitor every stage of a child’s progress at school. And that means tests. And that is why we are insisting on the publication, school by school, of exam results, testing scores, and truancy rates.

    Those who want to hide this information are quite wrong. Parents and public have the right to informed choice. They need to be able to judge how their schools are performing. Those performance tables are crucial – and they are here to stay. And in case there be any doubt, let me be crystal clear about some of the things I want to see.

    More attention to the basics of reading, writing and maths for our 5-7 year aids.

    Experienced people who are good with children coming into the profession.

    Children introduced to subject teaching and timetables at an earlier stage.

    And simple pencil and paper tests to find out what each pupil has learned – and what he has not.

    I want to see schools developing pride in the traditions and achievements of Britain – it is nonsense to have a history curriculum that is strong on the Aztecs but doesn’t mention Nelson or Wellington.

    I want to see truancy and absences cut back.

    Homework set and marked.

    Gifted children and those with learning difficulties stretched to their limits. And I want to see teacher training courses concentrating on subject knowledge, with experience of how to teach learnt where it can be learned best – in the schools. And, Madam Chairman, that will be the objective of teacher training reforms which we shall bring forward for next year’s programme for Parliament.

    People say there is too much jargon in education – so let me give you some of my own.

    Knowledge. Discipline. Tables.

    Sums. Dates. Shakespeare.

    British history.

    Standard English. Grammar.

    Spelling. Marks. Tests.

    And, Madam Chairman, good manners – good manners are important for children.

    But children learn by example.

    So good manners are important for headteachers as well.

    Madam Chairman, it won’t be easy.

    Our education reforms were never going to be plain sailing all the way.

    Our goals are clear.

    To put in place a high quality education system.

    To bring the best out of the skills of our teachers.

    To meet the needs of all children, whatever their abilities and wherever they live.

    To be on the side of pupils and parents.

    Nothing – and no-one – will deflect us from that task.

    Madam Chairman, I’ve spoken about the prospects for the economy. The need to control public expenditure. Tackle crime. Continue with our reforms on education.

    All of this falls within a classic Conservative agenda. Whatever we do we need to remember always that at the other end of our policies – are people.

    People with their own ambitions and their own hopes.

    They are not always grand ambitions.

    But we should always remember that a private triumph for a private man is as important to him as a public triumph for a public man.

    Our job is – wherever we can – to help everyone meet their ambitions – not stand in their way.

    But, Madam Chairman, one of the glories of our country is that people’s ambitions are not always for themselves. Often they are for others.

    At the beginning of the year I issued a call for more recognition of voluntary effort. We in government are looking actively at how we can promote and add value to the work that is done. And we have announced already that those who give of themselves for others will gain a more prominent place in our system of honours.

    We are a caring country. That is true of individuals – and it’s also true of industry. We should not forget the great part that British industry plays in voluntary support. There are those who talk glibly of the selfishness of capitalism.

    Frankly they don’t understand it.

    It is high time we heard more about the huge contribution of private enterprise to our national well-being.

    Not just in the goods it produces – or the jobs it creates.

    But in sponsorship, gifts, secondments, administrative help, and joint ventures with private voluntary groups.

    This private sector contribution grows year on year. Capital and charity hand in hand.

    Help worth over £200 million last year from just 216 companies in one survey.

    Giant contributions to health, education, sport and the arts.

    There are some who say news must reflect reality.

    Well, there’s some good news about Britain. Caring people. And caring capitalism.

    That is the reality – it would be nice to hear it in the news.

    Madam Chairman, Britain’s prospects for the future are looking up.

    Our economy is strengthening, our place in Europe secure.

    And as prosperity grows, so too will confidence and trust return.

    A country fashioned by the craft and skills of its people.

    One in which every person feels – heart and soul – that they belong.

    In whose prosperity all have their own personal share.

    People ask what we stand for. That, Madam Chairman – that is what we stand for.

  • Mr Major’s Speech at the Manchester Chamber of Commerce – 2 April 1993

    Below is the text of Mr Major’s speech at the Manchester Chamber of Commerce, held on 2nd April 1993.


    PRIME MINISTER:

    Thank you for your warm welcome. I am delighted to be here. 250 years ago Daniel Defoe called Manchester “the greatest village in the country”.

    Today it is a great city of Europe. That is not politician’s wholesale civility. This is the city of English commerce. This is Brindley and Crompton country: where faster transport met an eightfold increase in yarn and cloth production. Together that sparked the Industrial Revolution and sold shirts to the world!

    But why is it a great city? Because leading not following, Manchester has changed with the times. We all face a similar challenge. “The times, they are a’ changing”. In our interests we must lead that change and fast.

    The captive market is an inscription on a headstone. And the lordly assumption that it is a privilege to buy from the British has passed into history. Japan and the countries of the Pacific rim are giant manufacturing powers. China is set to become a huge industrial power. That’s the competition; so let’s not flinch, let’s not run. Our job is to beat the competition.

    So we must not make the mistake of falling for the alternative to complacency, the British gift for graceful despair. We can compete brilliantly and we are now well placed to win in the world’s market place. Step back a moment from the painful necessities of the last two years and consider the position today. Listen, please, to the scores Britain chalks up and you don’t hear enough about:

    – we have inflation below 2%, better than most of the European Community and most of the G7;

    – we have a highly competitive exchange rate;

    – interest rates are the lowest in the European Community and the lowest for 15 years

    We have not seen that combination for nearly 40 years. I believe industry and commerce have recognised that reality better than many others:

    – manufacturing output is up, so is investment;

    – productivity is rising fast;

    – you have kept wage costs competitive – doing better than Germany or Japan, better than any time for a generation.

    As the Chancellor said earlier this week, Britain is set for two years or solid growth, growth that is the fastest in the European Community big league. We have every reason to be confident about our economic prospects.

    We said low inflation would bring recovery. We brought inflation down. Recovery is now following as we said it would. Yesterday’s news that unemployment has fallen, fallen for the second month running is very welcome news. Welcome that it has fallen in every region. Welcome for the 50,000 people that Britain has put back to work this year. More businesses are beginning to take people on again and job vacancies are rising. All that can only add to confidence.

    The recovery will benefit every bit of Manchester’s increasingly broad-based economy. A diversified and successful base that is represented here so well tonight. Your region’s service sector is vital to the nation as a whole – and, as an employer, your financial and business services alone provide work for nearly a quarter of a million people. More, now that Mercury is bringing an extra 500 jobs.

    And Manchester is the student capital of Britain, leading the way in the sciences and technologies we will need for tomorrow. Three universities, a world-renowned business school, UMIST, you name it.

    That’s not just an investment for the future. Education is a key part of the service economy of today. A service economy that is also showing its paces abroad.

    The North West Chambers show that service exports have sharply improved over the last quarter. I applaud that. If the recovery is to last and prosperity to grow, we have to win and continue to win right across the market place. Vital though services are to our prosperity, we cannot depend on them alone. We need a vibrant, thriving manufacturing base.

    So, Mr President, I want to say a few words about the importance of manufacturing and just a bit about our export success.

    The British have managed a fanfare without trumpets. We are exporting more now than at any time in our history. But in the export market we operate like Jeeves – we just shimmer silently! We export discreetly. We don’t tell anyone; it might give offence. But I think we should.

    We British export £400 per person per year more than the Japanese: £1,800 for every man, woman and child, compared with £1,400 for the Japanese. What are we to do with the Gordon Glooms who always say British industry is crumbling? Listen, in financial services, pharmaceuticals, chemicals, the water industry, power generation, areas of food processing, the drinks industry, garments, aerospace and defence equipment, the oil and gas industry, mining equipment, biotechnology and international construction, we lead the pack.

    British companies account for ten out of the top European twenty companies by profitability and eleven out of the top twenty by size. And though the trade gap is still too wide, we are seriously engaging with the competition. We export televisions to Germany, lace to Brussels, cosmetics to the French, cars to Japan, and with a brass neck which would have delighted Richard Arkwright, we sell pizzas to Italy! The balance of trade in the motor industry will be revolutionised over the next few years; in partnership, of course, rightly in partnership, joining and beating!

    What about the future? Well, I’m a fairly tolerant soul. But I’ll tell you one thing I don’t like. I don’t like to see British manufacturers retreating from the field. I don’t like to see imports monopolising markets. I don’t like to hear defeatists say that radios or kitchen equipment just can’t be made in Britain. Some people said Britain couldn’t stay in computers. Yet today, more than one in every ten PCs made around the world is actually manufactured in this country. We sell £400 million worth of computers a year to the USA; and our software businesses are recognised everywhere. Britain’s car industry has turned retreat into triumph.

    Other industries can do the same. And retailers can help them – by looking for good British products and offering them to consumers. Not in rejection of good imported products – but in proper competition with them. Defeatism is most damaging when buyers and retailers won’t even look for a good British source of supply. Now British industry is becoming ever more competitive, there is every good business reason to seek out the home talent.

    And why is it so many people have such a low view of manufacturing? I think part of this comes from the outdated image of manufacturing as an employer of large numbers of unskilled people, in sprawling plants, doing heavy manual work: – the ancient, mythical world of the Cloggit and Thump brass hammer works! That’s not a low view of manufacturing, it’s a low understanding. Reality, manufacturing reality is more like the British Aerospace works I saw today; or the factory just 30 miles from Manchester I saw the last time I was here, a factory spinning optical fibres. Modern, expanding, sharp, the biggest producer outside American and selling to the world. These are great symbols but we want more than symbols. We want fast-breeder replication – more, more, more!

    The Need for Competitiveness

    Improving competitiveness is the key to expanding our manufacturing base. We know that when we’ve manufactured we can sell. As recovery picks up we must make sure there are more and more British goods for customers to buy of the quality and price they want to buy.

    There is one other danger waiting. Time and again since the war exports have gone up in recession but when the recovery came companies abandoned the export drive for the warm, debilitating huddle of the home market. Well that must not happen this time. We’re determined to build on our export success. That is why, in the Autumn Statement and the Budget, the Chancellor increased export credit and cut its cost to business. You keep exporting. We’ll keep supporting.

    Success requires continuous effort, continuous improvement. We cannot let up. Manchester knows something about this. The fourth generation mill-owners who bought shooting estates, lived in Surrey and wouldn’t replace old machinery, the soft and selfish gentlemen-manufacturers, very nearly destroyed Lancashire. Let us remember them in order not to be like them. Chance not decay must be our creed.

    Let me make it clear. I believe that the Government has a duty to work with industry to help industry meet the challenge. Not Whitehall picking winners, the winners picking themselves and Government helping them heart and soul.

    Everything we do has to be supportive of you. We want less of a tax burden on the profits that you need for investment. That’s why we’re pressing down on public expenditure.

    It is why we have to give priority within that spending to infrastructure projects which spell business. Manchester’s own Metrolink is a very real example. So is the Channel tunnel rail link, so is the Forth crossing in Edinburgh.

    It’s why we were reforming education. That’s what tests in schools are about: to find out what the children know and what they don’t. Because we need to know what they don’t know so we can teach them what they should know. They deserve the best, they need the test. You need the best, working for you.

    That’s why we’re doing more than ever before for good vocational training. To give our youngsters the best possible start in the best possible jobs. A recipe for the best possible success for Britain.

    It’s why science is a Cabinet job and why we are overhauling what we do on science and innovation to ensure Britain’s effort and brainpower backs industrial success.

    It’s why in the Budget we’re given extra help to Britain’s exporters, why we’ve cut businesses’ rate burden and cut ACT to boost business cash flow by £2 billion.

    And when we have winners we support them everywhere. I did it recently in India and in the Gulf. British firms had done the work. Government helped unlock the contracts. £5 billion worth of orders and 20,000 jobs safeguarded for years to come. I saw the fruits of the partnership earlier today when I met the Gulf Tornado builders at BAe, Warton. I and my colleagues will give that backing. So must all our Embassies throughout the world. Graceful manners and an elegant understanding are surprisingly well suited to the indispensable arts of trade. Pour them out the gins and tonics by all means, but then sell them both bottles.

    Winning back lost markets is the only long term policy for British industry – for the whole economy. And manufacturing is the soldier in the front line of that struggle.

    Making a Success of Europe

    Mr President, over recent months there has been a tiny frisson of controversy over our European policy. Let me set out my position clearly.

    Commercial success starts on our own doorstep. And our doorstep is Europe.

    When Europe walks, it walks in shoes exported from Manchester. The new rail terminal at Charles de Gaulle is work done in Bolton.

    The cocktail chatter is that the Government is too obsessed ith Maastricht, when we should be concentrating on jobs. In what world are such people living? Jobs and sales are what being in the heart of Europe is about. What made possible the vast expansion in small and medium sized businesses and new jobs in the 1980s? Where did they find their main export markets? In Europe, overwhelmingly. An example: a Leyland company went into Europe a few years back with one Chesterfield in the back of an estate car. In the single market it now does a million pounds of business.

    Have your reservations, by all means. No-one says Europe is perfect. But that story tells why we are there. Since we joined, our exports to it have grown nearly 50 per cent faster than those of our old EFTA partners. That is almost £20 billion last year, 20 exports billions worth of jobs. No wonder the Scandinavians and the Austrians wish to join the Community. What an irony that a nation which sought trade when Tuscan merchants bought raw wool in the Cotswold in 1370 should contemplate holding back from the richest free trade market of them all.

    The Chambers of Commerce understand the importance of Europe to Britain’s trading strategy and of the Maastricht process to that strategy. The President of your Association, Christopher Stewart-Smith – who is here this evening – wrote to me recent specifically to support what we are doing. Let me quote:

    “Those who suggest we have gone far enough with the single European Act are making a mistake that British business cannot afford. Businesses do not want to see the clock turned back, nor would they welcome the reintroduction of new non tariff barriers. Britain needs the commitment to subsidiarity to avoid unnecessary interference in domestic issues”.

    That, Christopher, is it – between the eyes! That is the message business should give to doubters about our commitment to Europe. Maastricht opens the way to the sort of Community we want. Taking that essential step away from centralisation, we gain the benefits of the single market without the drawbacks. At the end of the inky labyrinth of Treaty sub-clauses is a trading Europe. First and last and especially here in Manchester, that is what we want, a trading Europe.

    Yesterday, in the House of Commons, we finished the Committee stage of the Maastricht Bill. Let us now finish the Bill and get on with the job of building prosperity for Britain in Europe.

    One Stop Shops

    Let me say a word about the Chambers of Commerce movement. It is already helping its members win markets. But I think it can do more. I would welcome a bigger billing for the Chambers. It can only help for businessmen to swap ideas and learn from each other. I would like Government to develop the same relationship with the Chambers as with the CBI. The One Stop Shop Initiative is a tangible sign. And naturally, Manchester has won the bid to be one of the pilots.

    Manchester’s Olympic Opportunity

    Here in Manchester this evening one other issue commands me like a referee’s whistle – the city’s bid for the Olympics.

    Manchester’s bid goes beyond pleasing discus-fanciers. Building the Olympic facilities and hosting the games should generate £4 billion of new spending in the region and make 11,000 jobs. But better yet, it will be a shop window beyond dreams. The world would see what North West England has to offer. Manchester is already 8th in the European league of Best Cities in which to locate a business. But it can move up. I know, and everyone here knows, that Manchester has ambitions to be top of the league.

    So the Government is shouting (and finessing) for Manchester’s bid. We have put up £75 million for the bid and for the initial construction programme. That starts with the Olympic Arena and the National Cycling centre. We are providing some £40 million funding towards the regeneration of East Manchester this year. And we are backing Manchester’s bid by enduring that all the necessary facilities can be built. A state of the art Olympics for the start of the new millennium: where better than here in Britain, in Manchester?

    I am honoured to play my part. Together with Craig Reedie of the BOA and Bob Scott – who has done wonderful things for Manchester – I pressed the city’s case to the President of the IOC just a couple of weeks ago. No-one can be sure what will lie in the minds of the IOC when they vote to decide the location. Because of what has already been done, Manchester is one of the three hot favourites. Beijing and Sydney will make their pitch, but nothing that can be done for Manchester will be left undone.

    This bid and the great works that accompany it, are just one sign that Manchester has kept all its flair. Much of the rest of the world may still be going into recession. We are coming out of recession. And we have the edge: low inflation, rising competitiveness. We need the Manchester touch for the great things which are pending.

    It was Manchester which took raw cotton from Smyrna, sold it to the fast-bobbin men in Oldham, and the power-loom men in Preston. Then it sold cheap cotton cloth to the world. Manchester knows what must be done. So does the Government. United, we can do it.

  • Mr Major’s Comments on the Economy – 25 February 1993

    Below is the text of Mr Major’s comments on the economy, made in Washington on 25th February 1993.


    QUESTION:

    [The Prime Minister was asked about the state of the economy and unemployment]

    PRIME MINISTER:

    I think you have to accept the fact that it isn’t just a problem in the United Kingdom. I know that is not any comfort to the people who are unemployed in the United Kingdom but neither is it any help to suggest that it is uniquely a United Kingdom problem.

    In Japan, in Germany, in the United States and in all sorts of other countries there have been large job losses in recent months and for the same reason – because the recession we face in the United Kingdom is a recession that is biting painfully everywhere. The point is what can we do and what has happened?

    What we need to do to get people back into secure employment is to take the decision to get the economic fundamentals right. Some months ago, we had an inflation rate that was much higher – it is now down to 1.7%; we had interest rates at 14% – they are now down to 6%; we saw no signs of increasing re-investment – we are now beginning to see those signs of re-investment and we have also made some further progress towards the determination of the world trade talks which will lift world trade and create jobs everywhere.

    They are practical measures, sound bite politics criticising the Government may be part of the party political plan but it is practical measures like these that will provide secure jobs for the future and that is what concerns me.

    QUESTION:

    [The Prime Minister was asked whether the Government had made mistakes]

    PRIME MINISTER:

    If it satisfies you, no government that has ever been in office has failed to make mistakes. What we are concerned about is getting people back to work. It is the future. We are going to be living in this decade in the most competitive decade that we have ever seen. That means we have to have a competitive economy, it means in terms like inflation we need to be at least as good and hopefully better than our principal opponents.

    One of the points I think many people have failed to recognise about the changes in British industry is that we now have the most effective productivity rates anywhere in Europe. That is vitally important because it means we are competitive. Our exports are growing. People often saw years ago us having a declining share of world trade. It is now stabilised and potentially growing for the first time in generations. That is important because of what it means for our prospects in the 1990s. Unless we out-compete other countries we will have no secure prospects so we need the circumstances to make sure we can do that and that is what we putting in place.

    QUESTION:

    [The Prime Minister was asked about whether enough was being done about job creation and school rebuilding]

    PRIME MINISTER:

    But you overlook what we did in the Autumn Statement. We did create a job-creation programme in many of the measures that the Chancellor actually took in the Autumn Statement.

    The point that I am making is a different point, that to believe that you can actually solve the problem with short-term palliatives is wrong. We have put in range firstly the job-creation measures that the Chancellor announced in the Autumn Statement and secondly, to deal and assist with people who are unemployed at the moment, a wide range of training and other programmes. It is important to keep people who are out of work in touch with the world at work and to provide them with training opportunities so that they can use their skills. That is what we are doing.

    It is a three-pronged approach, get the economic fundamentals of interest rates, inflation and supply-side policies right, then have the right training programme so that people can benefit from those during the period that they are unemployed. Those are the sort of measures that are necessary.

  • Mr Major’s Comments on the Economy – 3 January 1993

    Below is the text of Mr Major’s comments on the economy, held during an interview held on Sunday 3rd January 1993.


    QUESTION:

    [Mr Major was asked whether 1993 would be a year of economic recovery].

    PRIME MINISTER:

    I think it will move at a different pace. I think what we see as we move into 1993 are the conditions in place that will re-engender confidence, encourage people to spend, to invest and the recovery to begin and I think that is generally the view of industry and commerce. I think it will be gentle. I don’t suddenly imagine we are going to be bounding into a speedy recovery and frankly, that is a good thing because the one thing we don’t want to do is to move so fast into it that we create problems two years down the road; so I think it will be gentle, it will accelerate and I hope we will have a larger level of growth in 1994 than we expect in 1993.

    QUESTION:

    [Mr Major was asked what he forecast growth to be in 1993 and 1994].

    PRIME MINISTER:

    Forecasts are dangerous things, as we have found in the past. One always has to make a series of assumptions, a series of judgements, and they can be quite significantly out – they have been for every Chancellor over the last quarter of a century – but our forecast is for a gentle growth of around 1% this year, some think it will be exceeded, some think it is about right. It is too early to be certain about that but that there will be growth I think is increasingly apparent and I think it will accelerate after 1993.

    QUESTION:

    [Mr Major was asked if that was a trend, and whether growth in 1994 might therefore be 2.5%].

    PRIME MINISTER:

    I hope we are going to move in that direction, yes. We will have a look again at the forecasts later in the year as we see how 1993 begins to develop but I think we need to move back to trend growth. The recession was longer than we expected and it was deeper than we expected and one of the reasons for caution about how rapidly one will come out of recession is not so much what is happening in this country but what is happening in our principal markets abroad because as we show signs of coming out of recession some of our partners in Europe are perhaps seeing their economies still slowing down.