Questioner (Peter Allen)
Mrs. Thatcher, if I could begin with the problems of British Leyland. You are [end p1] reportedly dismayed at what's happening. Is that an accurate description?
PM
Well, who wouldn't be? British Leyland has an absolute winner in the Metro. We've done everything we can to promote it—you know I've driven it, Cabinet Ministers have driven it—every single thing we can. It's a good car and it should sell and it's got one of the world's awards on one of the three best cars. There they have a tremendous opportunity. The British taxpayer really has backed British Leyland with big money throughout the last five years—money out of their own pockets—and here they are, on strike. The strike's already done a tremendous amount of damage, not only to British Leyland but to the whole British image. You hear people saying, look there they are at it again. Give them a chance and what do they do? Of course it's doing harm, and of course I'm dismayed. So are many of the people who work for British Leyland. So are many of the people in the Midlands. So are those who supply the components. So are those who supply the steel. So are those who depend in any way on the prosperity and future of British Leyland.
Q
So the message to British Leyland workers is ‘Go back to work or no Government aid’?
PM
I hope that British Leyland will repay the confidence that the British taxpayer has expressed in the British Leyland people.
Q
One can look back as it is the turn of the year at the past year and in particular the economic indicators over that last year. They've looked pretty bleak haven't they? It hasn't been a year when they've gone according to plan?
PM
The unemployment indicators are bleak and very worrying, very worrying indeed and that's why we're putting such tremendous emphasis on finding jobs for the young and as you know we have promised that the school leavers next year, if they haven't got [end p2] a job by Christmas when they leave in July/August, they will be offered some kind of work experience and that does mean finding a tremendous number of jobs and we shall do it. Some of the other indicators are going the right way—inflation really is falling, and falling quite fast. Interest rates are coming down. Exports have held up remarkably well. The balance of trade has done better than all the economic forecasters predicted. Wage claims are much more realistic compared with output and that's the crucial thing. Attitudes are changing, people are becoming more competitive, managers beginning to manage. Let me give you two other indicators. There's something called the Industrial and Commercial Finance Corporation. It's job is to provide finance for new businesses, expanding businesses, high technology businesses. Do you know this year it has provided finance for more new companies starting up than in the last four years. It's provided finance for managers who wanted to buy out a part of a company that might otherwise go down. So on start-ups, on management buying-out, on high technology, it has got £350m out investing in those new things covering 300,000 jobs. That is good. It's a new vitality.
Q
That may be the positive side, but look at the negative side and look at the unemployment figure which we mentioned—climbing up 3 million maybe? And besides that, the kind of investment you're talking about is minimal, it's peripheral.
PM
Well, 300,000 jobs, if I might respectfully say so in future industries is very good indeed. After all, don't forget, I was left with nearly 1½ million by the Labour Government. Yes, I do look at the negative side. I do beg you sometimes to look at the positive side and because you'll stay a long time on the negative side, let me give you something else about the positive side. One person on the unemployment register finds a job every ten seconds—that means a quarter of a million go off the unemployment register every month. And secondly, you know we have to keep a Value Added Tax Register of companies who have to pay Value Added Tax, yes, a lot have gone off. But the number coming on is as great as the numbers going off—at the moment slightly exceeds it. So that's a vitality of new [end p3] companies and there is the hope. Do sometimes look at the positive side and the vitality for the future.
Q
If I can look at the positive side then, the key to everything that is going to happen next year, in the year we're facing, appears to be getting investment into industry again, getting investment going, starting to produce real jobs as you would describe them. At the moment, in the past year, industry seems to have suffered, they are the ones who have had to suffer the cutbacks, the high interest rates. Is there going to be a change of emphasis by the Government in the New Year so that industry is really given more direct aid, so that there is a switch of emphasis?
PM
Well, there's a fundamental contradiction in what you've said isn't there? You said that we have been taking money out of private industry. Of course, every single thing that Government spends ultimately comes out of the productive sector. It doesn't come from nowhere, it comes from people who are producing goods and services that are selling and are making a profit.
Q
I was thinking of a switch from public sector to private sector then.
PM
Yes, indeed. But you're quite right, the private sector has been bearing very heavy burdens and that's why I've been trying to get down public sector spending. That's why we're being tough with local authorities. Because we are saying to the public—the whole public sector—hey, you're putting too bigger burdens on the vast majority of our people who work in the private sector and because you're putting up prices and because you're putting up rates and telephone charges and electricity charges. You're putting a too bigger burden on them, so it's I who am trying to get down public sector spending but I must say I'm not getting much help from the Labour Party, the Opposition, they're trying to stop me cutting public spending, they want more and more of it. [end p4]
Now if I were to go that way, I would be putting an even heavier burden on private industry and I'm trying to release funds for private industry. The key to success—let me define it in my way—is first, sound money. That means don't print more money, don't debase the coinage, try and keep the supply of money in line with the supply of goods and services, for it's that that backs money. You call it monetarism, I call it sound money. It's as old as the hills, it's as old as money itself. It's the only sound policy there is. Secondly, industry to stay competitive—that means keeping pay in step with productivity and production, not ahead of it, but in step with it and knocking out restrictive practices, and as far as Government is concerned it means keeping in incentives and seeing that there is, trying to see that there is finance available, as at the moment there is for good new projects starting up and for expansion, and there is finance. People are saving money now and we want to channel that saving into new investment so that we get the expansion. That's the three fundamental things for economic strategy and it's going to work.
Q
Can I finish with just two questions. One relates specifically to the New Year's Honours List. A lot of papers have drawn attention to the fact, and I'm sure a lot of people are wondering why our Olympic athletes, the Moscow Olympic athletes, didn't get any reward for what was a very notable achievement.
PM
We advised very strongly, I believe very rightly, that they should not go to Moscow to hold Olympics there which we believe did great honour to the Soviet Union, did great honour at a time when she was in Afghanistan, is holding down Afghanistan by force, by tanks, by helicopter gunships, by rooting out people in Afghanistan who are genuinely fighting for the very freedom which our Olympic people take for granted. I advised them strongly not to go. I defended and respected their right to decide themselves—that after all is democracy. They chose to accept their democratic right to go to a country which has no democratic rights. I respected their view. I did not agree with it and we could not possibly have gone against the view which we expressed very strongly—and note, the Russians are still holding down the Afghan people by guns, by tanks, by [end p5] aircraft, by death, by maiming, by killing.
Q
Can I just finish with a last question. You suggested we should be more positive about these interviews when we get them, so let me finish with a positive question. Your hopes for the New Year? Is it possible to summarise that in one answer?
PM
My hopes for the New Year. I believe things will improve in the New Year and that we shall see more new businesses starting up, more expanding. I believe that there is a new air of realism. People know they've taken far more out in pay than they've put in in effort and extra output. They know it's wrong. Now our task for the New Year is to see that this new sense of realism outlasts the existing recession and it carries on and it becomes a new understanding of what makes industry successful. You know, in democracy, there is no ‘them’ and ‘us’. It's ‘all us’ and people begin to realise that their future, their success depends upon their company and for the company it's the same whether you're a manager or an employee. Your livelihood is at risk unless you produce goods and services that your fellow workers in other industries will buy. That's they new attitude, that's the new realism and when it really takes a hold we shall be, with the backing of North Sea oil and gas, a most formidable competitor to each and every country in Europe.