Mr. Kavanagh
The obvious question is after Brecon, the result wasn't good for the Conservative Party and I assume you agree with that. It may not have been disastrous but it was not what you might have hoped for and the result seems to be causing some alarm amongst members of your Party. There are calls for changes in policy.
PM
No, well if there are I haven't heard them. I have only read of course the changes of policy in the press. None of them have reached me, and I think I should have heard them if there had been calls for changes in policy, on any significant scale. All right, there are one or two people who do want reflation, they are not the general number because reflation in fact is a way of saying please we want more inflation. Most of us think we have got too much inflation. People will have to make up their minds, and I think that people think that inflation at the moment is too high. So do I and it has got to come down again. So I have not heard, let me make it absolutely clear, on the contrary I have heard something quite different, which is to say “look what people really want” , and in any case the only thing I think they would ever get from me is firm government. Everyone, whether it's a housewife or a business, has to learn to live within a budget. However much you may want more the only money government has is money it gets from the people, and people much prefer to have a government being firm, living within a budget, having a firm direction in which to go and going that way. Yes of course they are concerned at some of the difficult decisions one has to make. So am [end p1] I. I don't like interest rates up, I hate mortgage rates up, but there came a time when one had to put the interest rate up otherwise you are going to get more inflation and the exchange rate was going to fall and fall and that would have been extremely bad. So sometimes yes you do have to make difficult decisions.
But let me just at least point out that we do have problems with unemployment. So does the whole of the rest of Europe. In this technological revolution where you can do so much more for your people and also where it is not generally realised there now, from 1979 till now, there are 1.1 million more people in the population of working age than there were five years ago, six years ago. So yes we do have unemployment and we are tackling that in the most genuine way possible. We also have record output. People talk about investment, in fact we had record investment last year and this year is going to be another good year too. We have a record standard of living and we have a lot of our industries being very very successful. As you know their profits have been recovered, and you have to have profits recovered if you are to have successful industries in the future. We have far fewer trade union problems, yes, we do have some in very well known sectors but throughout the great part of British industry, industrial relations are good.
Mr. Kavanagh
If I could just mention a couple of people … .
PM
… . let me get some information across. The 1.1 million is I think quite important because you see if you have got 1.1 million more population of working age it means you have to create a large number, and that's not the end of it. A lot of people are taking jobs who never took them before. That's not a bad thing … . there are many working part [end p2] -time who never were in jobs, well that's not a bad thing, it puts up the standard of living.
Mr. Kavanagh
I was going to return … . While you may not personally have heard these calls, there has been coverage of statements and interviews of politicians or with politicians with whom you may not find yourself in …
PM
One moment, saying what? Bernard have you got them? Saying what? Who are you thinking of?
Mr. Kavanagh
Julian Critchley is one, Francis Pym is another.
PM
Well Julian CritchleyJulian and Francis PymFrancis have always thought that there was some easy way. There isn't.
Mr. Kavanagh
They are suggesting that there should be another new policy change because of the new Cabinet changes and there is one report which I don't know if you have read but suggests that people are thinking that you yourself should stand down before the next election.
PM
Are they? I shall carry on, I shall carry on. I do not believe this country wants weak government. I do not believe they want a government to be so flexible that it becomes invertebrate. I think they want a government with a bit of spine.
Mr. Kavanagh
So you will be leading the Party until the next election?
PM
I hope so. Many of the calls I have had have been from people who have had a look at both alternatives and said look the government has to be firm, it has to know where it's going, you have to live within a budget, you have to be firm on law and order. Look where we have been. People are praising the police, praising the police. So they should. [end p3] But it was we who saw the police had proper pay, proper numbers, proper equipment. Oh yes we do have a level of crime which is too high, but my goodness, the praise the police are getting now is very well deserved. But we gave them, restored their morale and gave them the numbers, the equipment, the pay. And life is not only a matter of economics. It is also a matter of law and order. And it is also a matter of the quality of life itself.
Mr. Kavanagh
Can you tell me, Prime Minister what your …
PM
So my message is clear.
Mr. Kavanagh
You are firmly resolved?
PM
That's right. You don't want a government of flexi-toys.
Mr. Kavanagh
How do you feel about the Alliance in the wake of Brecon?
PM
I have seen it before. What I see now is people winning by-elections, by making great declarations, by strongly criticising government. I have yet to see clear proposals or alternatives which would both work and would be acceptable. We have been the way of incomes policies before. You know what happened. There is a social contract. You look to see if Joel Barnett 's quote from [inside] the Treasury, what is a social contract. The government gave and the unions took. And you have noticed that the Alliance will support what we are doing when it thinks it is popular to do so. You look to see that the record of Dr. Owen when he was in the Labour Party, he voted against our bill for postal ballots. Many of the things that we have done that they are now coming along years later and saying yes. But it was we who took the lead. [end p4]
Mr. Kavanagh
Is this the price you pay, that they are jumping on your coat tails and perhaps seem to be cashing in. Even the Labour Party is beginning to do that.
PM
The thing about Brecon and Radnor was the same as the thing about Crosby, and we found it, we found it after that 40 per cent opinion poll with Labour in the lead. The day before I got one which said that we were in the lead. That's why I suspected the other one. When I was at Milan there was one published, we were in the lead and that was in tune with our canvassing. But … . one which I suspected we could do nothing about, then the Alliance … with our people … . a second one … . we have got to stop Labour. But what we also said is look, we are not deciding who should be a government, we can vote without knowing there'll continue to be a Conservative government, and so long as I'm here they'll expect it to be a firm one. They know full well that no matter what sort of talk you get about abolish mortgage, tax relief for mortgages, so long as I am here there will be tax relief for mortgages. So long as I am here there will be firm budgetary control. So long as I am here I shall take the view that the only, which is correct, the only money government has is what it takes from the pockets of the people. And that we are, if anything, taking too much from the pockets of the people in direct tax, not too little.
Mr. Kavanagh
You were once quoted, accurately or otherwise, as saying that … praising Dr. Owen and saying he could be the next non-Conservative Prime Minister.
PM
I have never said any such thing. I praise David Owenhim when he supports me, and on most of the lead things they do come to support me. Very interesting. Very interesting. After one has done it, often in the teeth of opposition. [end p5]
Mr. Kavanagh
What are your views of the Alliance leadership, particularly Dr. Owen?
PM
I do not make comments about others, about the quality of leadership of those in other Parties. I believe in very firm leadership. It's not, Governments can't, it's not government to say what decision is going to be popular, we'll make it. Governments can't always make popular decisions. They can make things generally fair, fair in the longer run and which will keep Britain financially sound and going, I believe, in the right direction; and having international respect.
Mr. Kavanagh
So finally on the, in the wake of Brecon, do you have any message for the troops. Lord Whitelaw said it was a bad day for the Conservatives. Do you agree with that?
PM
The by-election result was not a good result. It was approximately the same swing as we had in Crosby, in about 1981 and we lost North West Croydon, and we regained both at the last election when there was a different question for the election. And nothing will persuade me to change the policies which I believe are right, which I believe must be continued firmly. If everyone in the family said please, we want more, more, more, you would just have to say, look there's a limit. When you are dealing with the family of the nation, the only way I can get more is by putting my hands, or the government's hands, in their pockets. I think we do it enough and I think the great majority of people look at their net take-home pay and I am sure I am right. Why do you think teachers are wanting more—they are wanting more net take-home pay. Why did nurses want more? They wanted more net take-home pay. What would they think if one promptly cancelled it out by higher taxation? What would policemen think if one promptly cancelled it out by higher taxation? People who have been [end p6] working hard in industry, earning more, and promptly cancelled it out by higher taxation? That is not what they want. People are prepared to pay reasonable taxes, to have reasonable services, but they also work for their families and expect to have enough of their own wages left and salaries to do what they want with their families. And after all it is a Conservative belief. I am not quite sure how you are going to use it, but 30 per cent of tax comes from people whose earnings are of the average manual wage and below. 30 per cent of our income tax, 30 per cent of our yield income tax. … . total income tax, 30 per cent of the income tax comes from people whose earnings are average manual earnings which is £8,000 odd and below. Another thing, use which one you think is most telling, a nurse will now put up to, when the present salary increases are complete, who earns £140 a week will pay £40 of that in National Insurance and in income tax. And that is a lot of money, and I have … of our pensioners, 40 out of every 100 pay income tax. Now it is not for people, not for us, not for MPs to turn round and say to them we have spent your tax relief. Oh no.
Mr. Kavanagh
… next question. When … your own enthusiasm up until … . or perhaps continues to be, is for cuts in the standard rate. You want to see the thresholds raised as well?
PM
I think you want to have a look at both, and you have to judge when the time comes which is better because we have to do everything we can to get out of the poverty and unemployment trap. That's why we have put so much emphasis on the thresholds. And we still have to put more emphasis on those. Then you have to remember that when a person first comes into paying tax, they are paying it at the rate of, the bottom rate is 30 pence in the £. [end p7] Plus you add a 9 per cent for National Insurance contribution, the total comes in at about 40 per cent of the next £ of earnings, and therefore one does therefore have to look at the first rate of income tax as well. It would have been very nice wouldn't it if we had been able to get it down. Frankly we have been able to get it down by a penny a year. Then your first rate, your standard rate will have come down to 25 pence in the £. We haven't been able to do that, but one does not disregard the bottom rate of income tax, you can't because that also is too high. Also may I say, and the viewpoint of those who are our good managers, and who are our geniuses in scientists, we have to watch their net take home pay because you know good managers have a market for their work the world over and we want to keep them here, because a good manager is one of the biggest assets industry has. And a person who can not only invent but can help to turn that invention into production, these are the people who are going to create the new jobs and the new work, and you have got to keep them here. That's why we have to bring the top rate of tax down to 60 per cent. And we have to watch that our top rate, and the point at which it bites is not out of line with that in other countries. Otherwise we lose our future wealth creators to others, so we have to look at it all. Your first social service is a sound industry and commerce.
Mr. Kavanagh
… . prospect that can we afford both ends, can we afford both the cut in the standard rate …
PM
No, you can't afford to do all of it together. We did the higher rate as you know in our first year, realising that we had got to get managers more to manage and we really wanted people to stay here and start up business on their own. And there are many, some who came back, some who didn't go, because we had done that. We then also brought the [end p8] level down, it was 33 pence in the £, to 30. And since then we have concentrated very much on thresholds. Now you have to look as you come up to each Budget what is the best mix to do as the time comes, and you must not in fact rule out a working on the level of income tax bearing in mind the very sharp way in which you come into paying tax. We have done something about it as far as National Insurance contributions are concerned as you know. By lowering … . to help with the poverty trap.
Mr. Kavanagh
Making a real impact on thresholds is very expensive, isn't it?
PM
Yes it is, and that shows you how very firm you have got to be to see that you get value for money for what you spend. It is not only living within a budget, living within certain public expenditure, every family has to do that, so why shouldn't government, why shouldn't every Department. It is also seeing that you get value for every £ spent, and may I commend to you the work of the Audit Commission, which is doing fantastic work of looking for value for money. And you know who recently said, recently found that we could get the same result in further education for about £150 million more than is necessary to get that same result. And really altogether has said in so far as the work they have done up to now and that has been two or three years they could save a billion on local authority expenditure. That is part of our duty to the tax payer, to have a look to see if we are getting value for money. And as you know we are looking at the health service too, to see that we are getting value for money. We have a duty, it is peoples' money we are spending, and we have a duty to use it as well as … [end p9]
Mr. Kavanagh
Indeed, and you have a Cabinet coming up this week which will be considering public spending.
PM
Yes we have indeed.
Mr. Kavanagh
You have got quite a large overbid, something like £5 billion.
PM
There always is, they always want more. Of course they do. Now and then you have to say no, or you have to say look, you know we need more money to raise the thresholds, you know people on lower incomes and pensioners are paying too much tax. You therefore have to say what right have we to withhold tax reliefs from them. Surely if you want more on one thing and I am the first to say yes, we have to do more on law and order, yes we have to do more on health, and defence, defence, law and order and health, and pledges to protect the pensioners. Now do you want, if that costs a lot to do, and it does, then we have to look to see whether we are spending every £ we ask and … . the best value and we have to look for reductions elsewhere. Do not assume that you start off at the level of expenditure of last year, just see whether you are spending it to best advantage, whether you can get more out of every £. Don't just ask for more £s, say can I get more value out of every £ I spend? That is what efficiency is all about.
Mr. Kavanagh
Do you then believe that you will meet your target by the time you finish this year?
PM
We shall have a jolly good struggle. Because yes, it is a struggle to keep things down, it is a struggle every year and every government has it. And we must still struggle because public spending has not gone down, it has in fact gone up by about 2 per cent every year, after inflation has been [end p10] taken into account. And that is with still having a struggle with every department every year. But remember all the time it is people I am taking it from and I really have some sort of contempt for politicians who try to bribe the taxpayer with their own money, try to bribe the people, the taxpayer with the taxpayer's money, and I hope the taxpayer rumbles what they are doing.
Mr. Kavanagh
Do you think in fact that the taxpayers have rumbled, do you think they appreciate what you are doing … and the pensioners … .
PM
Yes I do … . there are quite a number of people who say please, I want more, the other guy will pay. That doesn't seem to be fair or reasonable either.
Mr. Kavanagh
… . support has been throughout the last six years, do you think it will last until the next election?
PM
Oh yes I do, yes I do. People I think when they say they want more … expect us to get more out of existing money which is being spent, not to turn round and tax more heavily. I have made it clear, what would the nurses think if I said I am going, we have given you an increase, we are going to increase the rates of tax that you pay in order to find more for law and order, for defence, for subsidies to industry? They would say it is a fraud. Why do you think teachers want more? Not to have it cancelled out by more tax. Why do you think people put in pay claims? Because not to have the pay claims promptly cancelled out by more tax, it doesn't make sense. They want more net, take home pay to be able to spend more on their families and that is a very worthy objective. But I have to see that they don't take more out than is earned by the economy as a whole. [end p11]
Mr. Kavanagh
Do you feel that, do you suspect that the end of your period as Prime Minister that we'll still be saying that public spending has gone up and up each year regardless of efforts to keep it down?
PM
What we are now doing is not taking the full amount of gross, so we are trying to reduce the percentage of national income. It always goes up in a recession. We didn't get up quite to the percentage of Gross National Product that Labour did during its recession. The highest percentage of national income taken in public spending, Bernard have you got those figures, … . it was about 1976, the highest percentage of Gross National Product taken in public spending (Bernard Ingham: “it would be 1976/77” ) was taken by Labour during their recession. Would you ask Tim … we did not get up to that high percentage, but the percentage went up during our recession from what it has been and we are now trying to get the percentage down so that there is more room for tax relief.
Mr. Kavanagh
The Nigel LawsonChancellor has said that …
PM
You know, I have it with me every Question Time. Public expenditure as a percentage of GDP, not taxation, because they tried to cover it by too much borrowing and had to go to the IMF.
Mr. Kavanagh
The Chancellor has been quoted this weekend as saying that we have the strongest economy in Western Europe. We had a number of statistics which have cropped up over the last few months which I think you referred to in the House on one occasion as being a surprise to those, possibly even including members of your own government who doubted the course of action the government has taken, but … of your own policies. Do you see what the Chancellor is saying now as something along those [end p12] same lines, that in the next year or so we will see an improvement.
PM
Well yes, this is why I think it is so important to get across we are thinking about unemployment, that we are not just dealing with the same amount of people wanting jobs as in Labour's time. We have year after year … . of school-leavers because of the birthrate, and if you look back in the Labour manifesto of 1979 it pointed out that you would need to create about 170,000 extra jobs a year to stand still. So in the midst of recession we have had 1.1 million more people who are eligible for jobs and that of course has had its effect on the unemployment figures as well as the great technological revolution that we have had, and there's the world recession. And people who had their eyes on that and therefore they have not had their eyes on the record output, record standard, or on the fact that we have, there have been in the last two years something like 600,000 new jobs created, and because of the increasing population of working age, and because of the numbers of people in the population of working age, from 16 to 65, who have not previously had jobs, but have come into working part-time. That's why it has not had the effect we hoped on the unemployment register. But there aren't many countries in Europe that have been creating that number of jobs as we have, and we have steadily four years of growth now which we hope will go on and the investment is good and the profits are good. Now we are trying because the unemployment figures have been disappointing to give young people two years training instead of one, and also to try to help people who have been unemployed for a long time, over a year, to increase the numbers of jobs on the Community Programme, which is of course paid for by the taxpayer, to get them back into work and give [end p13] them back some self-respect. May I point out that this difficulty of a rising population of working age will turn in I think in 1990. At that stage the birthrate was such that you will have fewer school leavers and more people retiring, so the position then changes.
Mr. Kavanagh
Do you recall a comment by Lord Young about two months ago when he said that by the time of the next election the issue of unemployment would no longer be an issue. Was that a hostage to fortune or do you share that view?
PM
Well I don't recall that at all. I know of no such quote.
Mr. Kavanagh
… he was speaking … . Newcastle … . in fact I think it was the same time as Mr. Biffen said that he thought unemployment would be coming down before the next election.
PM
Well, I am very careful about making predictions about unemployment because I know this demographic problem and I know that we have many more people now having part-time jobs who before did not work. I am very careful in the face of those problems about making predictions about unemployment. I know that we are going about it the right way and we have this problem to get over until it changes. That is why we are putting into youth training, more into Community Programme and as much as we can into helping the formation of small businesses, because that is where the extra jobs are going to come from.
Mr. Kavanagh
But you don't see the economy in the way perhaps of these …
PM
I know, I know that if we go on creating more jobs then at a time when in the next decade the population [end p14] of working age is diminishing again, and you go on creating more jobs, there comes a time when the two things are going to cross over. And also if you have a faster rate of increase of small businesses, there are 140,000 more businesses now than when we came in, that I know that we are going about it the right way to tackle that. I wish we could, we are also going about it the right way to get more young people I hope trained at school in Maths and Physics and technology and engineering so that they can take engineering degrees and technology degrees at University, because you see we have tended to concentrate so much on the other things, to the disadvantage of Maths, Physics, technology. The Japanese have trained three times the number of engineers that we have.
Mr. Kavanagh
Do you, I don't know if the image has come across from the readers' or the viewers' point of view of the government's statements, certainly by the Chancellor at the weekend and in the past as if to say just you wait and see, something is going to, the news is going to be good in a year or two, in a way … .
PM
In the sense that more jobs, 600,000 more jobs than two years ago, in the sense that there is a record standard of living, as all the papers will show, and indeed many many people in work, as you know, their wages have gone way ahead of inflation. In the sense that company profits have been restored. If I say to you, would you rather work for a profitable company or one that is making a loss, everyone would go and work for the profitable company, it has got a future, it's got reserves, it can invest, do research, development. That's all going the right way. More businesses being created. Yes, some fail. You can't take a risk in creating new products, going into business without [end p15] having some failures. And yes you will also find failures in Japan and in the United States. You take a risk, some are going to fail, you get a new company together again and perhaps succeed a second time. So in that sense you are going in the right direction, that is good, that is excellent, in the sense of what we have done about labour relations in most private sector companies are good, are good. You know trouble is coming from the public sector, look where we are having the trouble … Now we mustn't regard the tax-payers' purse as bottomless, taxpayers have to earn their money too, and also one person in the public sector pays tax and then pays the wages of another. So in that sense, yes there is a very very great deal of good news indeed, and if you turn and look at Europe you will find that many many are saying that that sort of news is very good and that their governments are actually tackling problems, indeed if I were to point to you Holland and Germany actually have taken public expenditure reductions of a kind that I could not get through this Parliament, because their people have been prepared to tackle and, I think, some of the politicians have reckoned that it is better to have a government that tackles it. Some of ours you try actually to bring things into control and they all go, their rhetoric goes that people must have everything. I mean, take housing benefit. Every two householders are keeping not only their own families, their own houses going, but contributing to a third, a third household as housing benefits. They can't go on like that. Housing benefit is still rising, even after the changes we have done, the amount spent on housing benefit next year will still rise. And no government can sit and watch that and do nothing. And it doesn't help if your Opposition just scream and say well, some of the people are going to have it taken away from [end p16] them. You have got also to look at the burdens you are putting on the two householders for keeping not only themselves but a third. You have to to be fair between those who are doing the paying and those who are doing the receiving of benefits.
Mr. Kavanagh
While we are talking about burdens of householders the issues of rates and mortgage interest rates, household rates and mortgage interest rates, can I ask you whether you are still as firm in your resolve to bring something on the Statute Book in time for the next election?
PM
I should like to get in time for the next election, that is my objective. As you know there was a big Green Paper before the last election and it was not possible to get people to agree on the way forward. Now I think the problem of rates has become so urgent that I think everyone will agree something has to be done about them and then I have to say right, I accept something has to be done, so do you. We have got to agree on the way forward and only in that way can we take it on the Statute Book because you see that most people are taxpayers, some people are also very heavy rate payers as well, and they are getting in my view less than a good deal, they are getting a bit of a raw deal.
Mr. Kavanagh
Can it be done without spending large chunks of electorate … .
PM
But look, if too few people are bearing a heavy burden, then it is unfair on them. You then, the only way to disperse that burden is for more people to share it. But if democracy is always going to become a matter of political rivalry then democracy is silly. Every person in democracy has to be prepared to share a fair burden. Yes, it would mean some people who pay no rates paying some, or who [end p17] pay nothing towards local government paying something towards it. But are you asking … political rivalry or are you asking me as a government to be reasonable, equitable and fair. I am not prepared to … political rivalry at the cost I believe in fairness and equity. It is unfair on ratepayers at the moment.
Mr. Kavanagh
There is the political issue of making the burden for some a little easier but spreading it to others who have no burden in the first place.
PM
That's right. Yes, if we do make the burden for some a little easier, indeed on housing benefit I mean there are people who go way up beyond average earnings, way up beyond average earnings of house-holders who are still getting housing benefit.
Mr. Kavanagh
So we are firmly fixed as far as you are concerned on something on the Statute Book by the election.
PM
We are talking about rates.
Mr. Kavanagh
Yes.
PM
As far as I am concerned that is my objective, that is my objective.
Mr. Kavanagh
And on interest rates, the combined area of interest rates and … .
PM
You always have to ease the burden for those who can't afford it. You can't suddenly come into paying everything, whatever alternative you have you have to ease the burden on your poorest, obviously.
Mr. Kavanagh
So it could be phased in … is that [end p18]
PM
No what I am saying is whatever burden you have, you have to ease the burden, whatever tax, local authority tax you have, you have to ease the burden on your poorest.
Mr. Kavanagh
Can I pursue that a little further. Are you suggesting that they would be able to get some welfare help with rates?
PM
No, no, I am saying just exactly as now you have some rate rebates, you have your local authority tax rebated, so whatever substitute you have you have to have it rebated for your poorest.
Mr. Kavanagh
And on mortgage interest rates, or interest rates generally, the CBI as you know has been pressing for a cut and the … . been resisting on interest rates.
PM
Yes indeed I hate the higher interest rates, I hate higher interest rates, but we were watching, you have got inflation at 7 per cent at the moment and you have a £ that was falling very sharply. Now the consequences of the £ falling very sharply would be to put up the prices of everything that you import … . dollars, that is a lot of raw materials, a lot of other goods. So you are faced with a dilemma. If you didn't put your interest rates up you would have a wide range of price increases, on everything you imported, because the £ was falling. If you did put your interest rates up you would, your £ would recover, and therefore your price increases would not be such, your price increases would be less, and now some of them should be less. But you have the effect on mortgage interest, so that was a terrible dilemma, but we had to do what we did, because otherwise the price increases right across the piece would have much worse. The £ has strengthened and we have no wish to keep the interest rates high, but we do have to [end p19] keep it at the level which will bring the long term rate of inflation down.
Mr. Kavanagh
So the improvement in the £ isn't going to have an immediate impact to do anything?
PM
Well if you look you will find some places now where your petrol prices are down from what they were, that is partly the recovery of the £ against the dollar. You see if you have a low £ and a high dollar everything that was invoiced in dollars costs more in £s to lower the £, and therefore everything, as we have to import a lot of our raw materials, invoiced in dollars, that goes into the prices of everything made in this country, and therefore you would have a very adverse effect on inflation. It's all a question of making judgements. That was one. You then have to look and see the value of the £ from the viewpoint of exports, if the £ had fallen too far, it would have a very adverse effect on inflation.
Mr. Kavanagh
Can I turn to the Cabinet reshuffle.
PM
Well don't reshuffle my Cabinet for me. I know by saying that I won't be able to stop you from doing it. As you know I do not reshuffle while the House is sitting. Fortunately we have never had any personal tragedies so I have been able to do that. I reshuffle during the Recess, sometimes at Christmas, just after Christmas, sometimes as well during the long Recess. I haven't the slightest intention of changing. I haven't made up my mind exactly what changes there will be or when they will be.
Mr. Kavanagh
Certainly you are ruling out the suggestions that there might be one before September. [end p20]
PM
I haven't made up my mind exactly when it will be or what they will be.
Mr. Kavanagh
You have probably seen or may have heard that some had a poll on Cecil Parkinson … a very overwhelming majority suggest that he should come back in some role or other. How do you feel about that?
PM
Well you are trying to find out what I am going to do. I have noticed your poll, and as you know I have said, and say again, Cecil ParkinsonCecil is extremely able, he knows how to build up a business, he knows how to expand it and knows how to create genuine jobs for others, he is not one of these people who talks about creating jobs, he has actually done it.
Mr. Kavanagh
So would you like to see him back in the Cabinet?
PM
I am not going any further, because what you are trying to do is find out exactly what I am going to do, and as I say, I haven't made up my mind precisely what moves will have to be made.
Mr. Kavanagh
Slightly outside the Cabinet then, the Party … .
PM
I think you will admit I do have quite a lot to keep me very busy.
Mr. Kavanagh
I am sure you do, and I am sure that must be a rather difficult piece of manoeuvring to decide on.
PM
It's not manoeuvring, it's a difficult decision. It is something I have never enjoyed. I don't like doing it, as you know, because you can't, there are a lot of people you know exactly whom you would like to put in and bring on. You have to bring people on, you have to. That means people [end p21] go out. But you know, I beg you in the press, not to say that so-and-so is sacked. It isn't on, and it is just that they have to make way for other people to have a chance.
Mr. Kavanagh
Could I ask you about the Party Chairmanship or is that again something that you would …
PM
Don't go … it is the same thing. I haven't made up my mind yet.
Mr. Kavanagh
The Party itself is suggesting that that should be open to a vote.
PM
No what is … . the Party Office is the Office really of the Prime Minister. The Chairmanship or Presidency of the Party in the country, that is all the voluntary people, is decided by them and I have nothing whatsoever to do with that. That is Sir Russell Sanderson, Chairman of the National Executive, whoever shall be President of the National Union, that is the Presidency or Chairman of our Party in the country, the voluntary Party. The Chairman of Central Office is, the Central Office is always meant to serve the Leader of the Party, and therefore is the appointment of the Leader of the Party. The Presidency of the Conservative Party in the country as a whole is done entirely by the votes and decisions of the Party as it should be.
Mr. Kavanagh
Do you feel, going back to the if I could just for a moment, that the Chancellor is now talking about presentation of policy, and yet over the weekend there has been a great deal of confusion over exactly what was being aimed at. [end p22]
PM
But you see it is not by what Nigel Lawsonhe says that there is confusion. Every single politician these days has to reckon that there are more paragraphs and words written about a speech and its interpretation than there ever were in the speech itself. I sometimes think of Kipling: “if you can bear to hear the words you have spoken twisted by knaves to make a trap for fools” . Well some interpretations are dead straight up and down the wicket, others undoubtedly are twisted for the purpose of those who are doing the twisting and it is an occupational hazard. It just means we have to look a little bit more carefully about what you say so that sometimes you have to reduce the potential for twisting. And I hope I have been very clear about what I have said.
Mr. Kavanagh
Indeed.
PM
But you know, the commentary, the industry of commentators is enormous. There are more commentators per sentence spoken than ever before in history, so the people no longer look at what was spoken, they tend to look at what the commentators said and that is bad.
Mr. Kavanagh
But the expression … did cause a certain amount of confusion, did you not read that perhaps that was a … .
PM
I have always … I prefer to put it differently. You have to have sound monetary policies and you have to be firm about them. And that is an objective thing. It doesn't depend on being the middle …, the common ground or anything else, it depends upon having sound policies, sound budgets that you can sustain in the interests of all of the people. Now don't then go and say that that is a criticism of the use. I have given you my way of putting it which stays and will always stay. [end p23]
Mr. Kavanagh
And you firmly support the Chancellor's two speeches, or speech …
PM
I firmly support the Chancellor's approach, which is my approach. What the Chancellor was saying was we have been fair both to those who bear the burden of taxation and to those who receive the benefits, now that is the way I would put it. And we consider both.
Mr. Kavanagh
I think my hour is almost up … . perhaps we can go into the garden.