Speeches, etc.

Margaret Thatcher

Speech to 1922 Committee

Document type: Speeches, interviews, etc.
Venue: House of Commons
Source: The Times, 1 August 1980
Journalist: Fred Emery, The Times, reporting
Editorial comments: 1800-30.
Importance ranking: Major
Word count: 654
Themes: Economic policy - theory and process, Employment, Industry, Monetary policy, Privatized & state industries, Pay

Tories beating inflation and gaining new respect abroad, Mrs Thatcher says

Mrs Margaret Thatcher cheered her backbenchers last night with a typical confident rallying cry that the Government was winning the battle against inflation and winning “massive support” at home and new respect overseas.

Addressing the 1922 Committee of all Conservative backbenchers at the traditional private end-of-session meeting at the House of Commons, she detected most notably a new mood in industry in which management and unions were treating each other as social partners. “Managers” , she said, according to authorized accounts “are beginning to manage again for the first time in years” . The “we-they” confrontation was becoming a thing of the past.

The Prime Minister went on to assert that people at large were recognizing that the Conservatives were talking economic sense. One piece of good news she had was that next month's inflation figures would come out before the bad unemployment figures, and would show a significant drop.

She gave no figure, but, according to one MP there, she hinted optimistically that the retail price index would drop more than the 3–4 per cent associated with the lapsing of the effect of increased VAT.

Her peroration brought the usual table-thumping applause. “We have massive support not only in the party but throughout the country” , she is reported to have declared. “We have welded ourselves into an effective Tory team. The opposition fear we are going to succeed. They are right. We are.”

According to one senior member there, it was not an outstanding performance by Mrs Thatcher, but the message “we are winning” was what came over most strongly, with the determination that the Government must stick to its guns. Traditionally, there are no questions or interventions from the floor at such meetings.

Mrs Thatcher, speaking for about 15 minutes, set out both the worries facing the Government and what she saw as hopes. First among the difficulties was the evident pressure [end p1] from the nationalized industries to break the Government's cash limits. She said the money could come only from the contingency fund, but that was not acceptable and would be resisted.

Next, was her concern over pay increases in the public sector. Here she had some vivid language. The private sector was struggling to hold down pay rises, but would not do so, on be able to do so, “if they see the national coffers being emptied into the town hall and Whitehall” .

The public sector had to be held down; but Mrs Thatcher was careful not to give any figure to the meeting, or even to say that she wanted the cash limits for the public sector next year to be held within single figures, which is her reported wish.

Her third worry was unemployment and all her emphasis was on the need to help the regeneration of small businesses with the cash payments through the Youth Opportunities Programme.

It was, not unnaturally the good signs Mrs Thatcher listed that fascinated her audience. In addition to the hint about a fall in inflation, she mentioned interest rates with hope. She gave no indication of timing, but the impression left on some who heard her was that a reduction would not be long delayed.

The Prime Minister dwelt mainly on what she detected as a change of mood in Britain.

She likened what she was discovering on her Friday trips to factories and offices round the country to the West German practice of social partnership.

Where managers were again making clear what they wanted they were getting a response from unions, she said. Most of all, in what she said were real price cuts, the “competitive high street” was showing the way in contrast to the “monopolistic public sector” .

The Conservative talk of the need to cut overmanning and end restrictive practices was what was striking chords round the country, not the Labour Party message of subsidies and nationalization, which, she said, was out of tune with the man in the street.