Lord Young
My message to the electorate today is very simple. It is simply that only by voting Conservative can we keep unemployment coming down. For we do have well tried policies. Our success is generated at the way in which unemployment has continued to come down—a million jobs have been created since 1983 and unemployment has now been dropping for the past 10 months. Indeed, it is falling faster than any other Community country. By contrast, both the other parties make cynical promises. In reality, which I hope to show to you in a moment, they would do nothing but destroy jobs.
Our approach is founded on two pillars. First, you cannot get unemployment down without having a strong economy. It is a strong economy which creates jobs. We need the combination of low inflation and high growth, low taxes and, above all, we need business confidence and the freedom to manage which we have created through our trade union legislation over the past six years.
Secondly, we have created a wide range of programmes unequalled anywhere else in the industrialised world to help unemployed people back into work. With this Manifesto, we are introducing three guarantees. First, a quarantee that every school leaver under the age of 18, who is unemployed, has a guaranteed place on YTS—the youth training scheme. That is a guarantee unequalled anywhere else.
We are now saying to all people under the age of 25—as soon as you have been unemployed for six months, you have a guarantee of a place on the job training scheme, in a job club or in the enterprise allowance scheme. Everybody under 25—six months—and that is unequal. We are saying to all unemployed people that every six months throughout the period of unemployment, he will have a counselling session. We hope and aim, over the period of the next five years, to be able to offer all who have been unemployed for more than two years a place on the Community Programme, a job club, job training scheme or one of the large package of measures we will have, because what we find out more and more it is skills which [end p1] people require to get them back to work. In a society in which there are 7 million job changes a year, 3 million unemployed, there are 1.3 million people who have been out of work for more than one year.
By contrast, the Opposition has policies which would rapidly destroy jobs. The only policy they have is to return to old style reflation. Their reckless spending would once again—
If we actually look at all the particular packages which are Labour policy (referring to chart). Minimum wage legislation, which is not just in the Manifesto. It was a resolution passed at the Trades Union Congress last September. It was reaffirmed at the Labour Party Conference. It says two things: initially, there will be a minimum wage of £80 a week. But much more important, everybody will maintain their differentials. That was put in at the behest of the trade unions. My Department calculated that 600,000 jobs would go within two years.
Secondly, Polaris, Trident, US bases—60,000 jobs. The details are in your handout, or will be available to you when you leave. Nuclear power—150,000 jobs will go as we phase out nuclear power if the Labour Party's Manifesto goes in. The Energy Secretary said in the House that another 800,000 jobs are dependent upon low energy costs, which would be put in jeopardy if that happened.
Sanctions to South Africa—120,000. The Foreign Secretary again gave evidence: 120,000 jobs would be lost in this country if we applied full sanctions on South Africa. Private health and education—a further 50,000 jobs would go on that. There have been interesting developments, I think, in some of the press today which seems to reinforce that. In addition, we have three unknowns. Trading levy. Mr Prescott, the occasional spokesman on employment for the Labour Party occasionally says that we will have a 1 per cent. on payroll tax, and than a 1 per cent. on turnover tax. It could cost many billions of pounds. I am not sure what it will actually do, but it is a great cost on industry. Loss of investment confidence. That is impossible to quanify. It is also impossible to say how great will the loss be if the Labour Party ever came in.
Finally, I only have to use the words of Neil Kinnock who reaffirmed on television yesterday that they would [end p2] reintroduce secondary picketing. The prospect of introducing secondary picketing would be about the greatest single blow we can do to stop industry carrying on being competitive.
Q
Lord Young, you say that voting Conservative will cut unemployment. But all you have spoken about so far as your Party is concerned is training and counselling. Where are the jobs you are going to create? Secondly, you said that your Department had costed Labour's proposals. Is not that an abuse of Civil Service time?
Lord Young
On the contrary, it is very important that civil servants should examine all prospects of all proposals. After all, it is a very odd world indeed when a Party Conference and a Trades Union Congress adopts such suicidal policies that I would be failing in my position as a Secretary of State if I did not ask my economists to calculate the precise effect of that. Who knows? If it had been a beneficial effect, I might have adopted it. But 600,000 jobs—no.
As regards your first point. The fundamental difference between us and the other parties is that we know, with certainty, we do not create jobs. It is industry and commerce that create jobs. What we have to do is the create the climate so that they can prosper.
Q
The Prime Minister on the radio yesterday went over how the differentials between someone on social security or unemployed was too little compared with the low-paid worker. Do the Tories really care whether they widen that divide by increasing the wage of the low-paid worker, or by actually diminishing the net income of the unemployed or social security person?
Lord Young
We care very much indeed that we should restore incentives in society. The only way that we can do that is by reducing the burden of tax, not—I repeat, not—in any way by reducing benefits. It is very important that we reduce taxes and that has been the process on which we have been engaged, and will continue to be engaged. [end p3]
Mr Bevins
Speaking of reducing tax—in 1979, you carried out your pledge to shift the burden of personal taxation from direct taxes to indirect taxes when you unified the rate at 15 per cent. This has been described in the campaign guide as a bold start. Do you intend to finish the process? What is the next move forward, and can you tell us, Prime Minister, whether, in fact, yesterday's statement on the radio, was a pledge that the VAT base would not be extended?
Prime Minister
Yesterday's statement, which I made on radio, was made in precisely the terms in which I made it, and those are the terms and those are the terms which stick. I am not going to put any gloss on them at all. You referred to the 1979 Manifesto. You will know that it was specifically there that we would reduce income tax and that we would have a shift from direct to indirect income taxes. There is no such strategic shift in the present Manifesto. That is clear.
Q
Are you going to improve the job training scheme in view of the fact that half of the private sector managers on the pilot study pulled out? In some of the areas of the pilot study, up to 38 per cent. of the trainees dropped out.
Lord Young
It is no good taking figures from one or two pilots. I believe that the job training scheme will show to be a tremendous success. There are a long queue of people waiting to go into it all over the country. What I have objected to is the cynical attitude of, first, the Scottish TUC and some unions in first coming along with a scheme to help unemployed people and then apparently raising resolutions to black it. It just demonstrates one more time that the TUC is interested in the employed and actually have little consideration for the unemployed.
Q
Lord Young, can you confirm that young people between the ages of 18 and 25 will no longer be able to go on to the Community Programme? If that is the case, will you be readjusting the allowance paid to YTS trainees, because there seems to be an anomaly? [end p4]
Lord Young
I do not think that there is an anomaly at all. What we are doing on the job training scheme is looking for adults to come on to a training programme leading towards a vocational qualification, and dealing with a whole range of people in very different financial circumstances. Some might be single. Others might be married with two or three children and have householder commitments. The only way we could find a fair way to do that was to say that people will carry on doing it at benefit levels, plus their travelling expenses and, I think, their lunches. It is important to know is that there is no shortage of applicants to come forward. The only objection we had on this is from trade unions who have some mystical objection to anybody doing things other than rates that they have negotiated.
As far as the Community Programme is concerned, we are again changing that by making that a premium over benefit to a full-time work experience programme and that is done on the basis that it was more than likely to attract older people who obviously have family commitments.
Q
You spell out in great detail how many jobs you think Labour's policies will lose. Why cannot you tell us how many jobs your policies on the economy will create?
Lord Young
Because they are creating—we have seen 1 million jobs coming on—already come over the last three years. We are seeing a growth of jobs continue to come on. I recommend that you read the CBI report this morning, which shows that industry is getting very good orders and that this is actually proceeding extremely well. In their trade union laws repealed—in 1981, I went to Japan. I was then special adviser to the Department of Industry and I went there trying to persuade Japanese companies to come and invest in this country. The very first company I spoke to, which was in electronics, said to me, “Well, I am sorry, Mr Young, the climate isn't right” . I said? “What is wrong with our climate?” “Oh no” , they said, “It is your trade unions, your industrial disputes” . Time after time after time, overseas investors shied away from this country. Today, they are flocking in. I am the first holder of my office this century who has spent no time in the last two years on industrial disputes. None whatsoever. If that comes back, I can tell you that my successor will be spending a large part of [end p5] his time on industrial disputes, and the Department of Trade and Industry will be spending very little time on new inward investment.
Mr Tebbit
It might be appropriate to point out the change which has come about in the unprecented types of agreements which are now being made between trades unions and employers. I suppose that everybody looks to the Nissan example as the most prominent of those. Without that improvement in industrial relations, I do not believe that companies, such as Nissan, would have had any interest at all in investing here. Indeed, I do not think they would have needed to do so because by now BL would be dead.
Q
Can Lord Young tell us when he expects unemployment to go below 3 million, and if he expects the present rate of job creation to continue?
Lord Young
That depends crucially on what happens on 11 June. But on the confident assumption that our current economic policies will continue past that date, I expect to see unemployment continue to come down in the time ahead. Arithmetically, you can work it out for yourself. It is falling at about 25,000 a month. Unemployment today stands at 3,020,000.
Q
What level does the Prime Minister think that unemployment should be at the end of her third term to determine whether or not she should be drummed out of office?
Prime Minister
We do not, in fact, as you know, predict employment levels or unemployment levels. No Government in power have as you will see if you go through the many questions and answers across the Dispatch Box over the years.
Lord Young
Beveridge said in the report that he anticipated that unemployment in the post-war world would vary between 8.5 and 10 per cent.
Prime Minister
But we hope it will be lower than that, but we do not prophesy a rate for one very simple reason. You do not know what world trade will be. We have tried to stem the move [end p6] towards protectionism. What we do know is that we can create a climate in which business will create the jobs and it is business that is creating the jobs now.
Mr Dimbleby
Do you attach any particular significance to manufacturing industry as opposed to other kinds of economic activity?
Lord Young
I think that manufacturing industry is very important. I should point out though that in the 10 years from 1966 we consistently lost manufacturing jobs at the rate of 10,000 a month. We are losing manufacturing jobs at a lower rate than that these days, but every industrialised nation in the world, with the exception of Korea—and that is just on the turn—is losing jobs in manufacturing industry because of the effect of new technology. So I expect us to continue to have a very strong and profitable manufacturing industry. I do not really expect to see it continue to employ more and more people. I would expect to see the numbers keep stable or gradually decline over the next 50 years.
Mr Dimbleby
Would you expect the deficit to go?
Lord Young
Well that depends very much on what manufacturing industry does. If it carries on the way it is going now, I would expect it to go. But remember that the distinction between manufactured goods and services becomes more and more blurred. In fact, at one time the only way you would make wealth was by making ? ; these days you make wealth by providing services. It is very difficult to see where one ends and the other starts.
Elinor Goodman
Why is it you are prepared to put a figure on what the Labour Government would do for unemployment, and you are not prepared to put a figure on what the Conservative Government would do for unemployment?
Prime Minister
There is a specific policy to which we can attach figures. If you are going to phase-out nuclear power, you know the numbers of people involved. If you are going to throw out the American bases, you know the numbers of people involved. If you are going to apply full comprehensive economic [end p7] sanctions, you know the amount of exports that are going to South Africa now and you do a calculation of the jobs involved. If you are going to stop private health education, you know the number of jobs involved. There is no way in which one can calculate how many small businesses will come on and how many people they will employ. There was no way in which I could have told you at the last election that the company whose extension I opened on Saturday morning would, in fact, employ about 1,000 this year. For the work it was doing, it could not have existed before 1981, because we, first, had to break a Post Office monopoly on delivering valuable letters and documents and parcels. It was only when that monopoly was broken—even that would not have done it; it was someone who spotted the gap in the market and then said that they would set up a courier service with a few people. They are now the biggest courier service; they now employ 1,000 people. They are called a service. I could not have predicted that. I could not have predicted that the one which I went to in East Anglia the other day, which is in manufacturing and knows all about switch control would have increased by 200 since the last election. One cannot predict who will take up these possibilities of enterprise. Those are two specific examples in the last two days. What we do not that having given the tax incentives that the enterprise initiative is here to take it up.
Lord Young
I wish to refer to the last item—trade union law repealled. People tend to forget that 10 years ago we were losing 3 million days through strikes in each year—six days per worker. In 1978 alone, BL axed the Triumph plant in Speke. It had been on strike for 16 weeks with a loss of 3,000 jobs. It announced that it was deferring a £280 million investment programme in Solihull, which had been intended to double the Rover plant. It cancelled plans to build a new plant at Bathgate after a six week unofficial strike which lost 2,000 jobs. We forget that in 1972, Chrysler lost 2 million man hours from strikes. In the next year, it suffered 42 strikes in six months while the French company associate had suffered no major strike for 18 years. Then we wonder why Chrysler pulled out! It is crucial that we continue with the industrial peace, which I must say is not imposed by the Government, but trade union members. It is crucial that we continue that industrial peace if we want to see employment grow. [end p8]
Mr Tebbit
More particularly—in answer to Elinor Goodman 's question—when Independent Television was established some years ago, we could not have predicted that she would be here enjoying a job which did not exist at the time. Nor all those of you who are working for the independent sector of radio and television who have jobs which would not otherwise have existed. So we are rather modest in our forecast, but the results seem to come pretty good, don't they?
Elinor Goodman
But surely Labour predicted at the last election that unemployment would rise under you?
Mr Tebbit
Yes—to 6 million was their prediction.
Prime Minister
Are you talking about the prediction? How very convenient of you. ‘Tories 6 million dole queue’ predicted by a certain young man called Mr Kinnock. That was totally and utterly wrong. It was predicted by the Daily Mirror—headlined in the Daily Mirror 11 May 1983— “Unemployment could double to 6 million if the Tories win the coming election” Shadow Minister Neil Kinnock warned last night. They were wrong, were not they? That shows the danger of making that kind of prediction.
Peter Riddell
Following Lord Young 's controversy with Professor Layard and the extent to which the fall in unemployment has really been a statistical reflection of changes in the labour market, particularly the change in the participation ratio, would he like to comment on that?
Lord Young
Yes. I think you should distinguish between Professor Layard, the labour market economist and Mr Layard, who is apparently an Alliance politician. I would much rather leave it to Professor Minford since I hate to get between two professors whom I gather from the paper today also said that Layard was totally wrong. Let those two fight it out. I say to everyone—use the evidence of your eyes. Look at the situations vacants out there. Look at the way in which the economy is growing. Look, incidentally, at the report in today's paper about the skill shortages in the construction industry. That is the evidence that, in fact, shows that the economy and that there are many jobs out there. [end p9]
Q
When are you going to stop the Inland Revenue from persecuting the self-employed and also the Customs and Excise?
Peter Brooke
I regard that as an absolutely outrageous suggestion. My personal responsibility to Parliament is for Customs and Excise for whose management and effectiveness I have the highest possible respect.
Q
Lord Young, during your time at the MSC, you seemed only too happy to work within the consensus of employers, unions and educational reps. Why are you now proposing to change that consensus in favour of the employers? Will it not lead to suspicions that you want to push through policies such as on benefits and work that will be opposed by the unions?
Lord Young
No, we did provide a very good consensus for a number of years in the Manpower Services Commission which enabled us to bring through programmes like youth training schemes and community programmes. But in the last year, I am afraid that politics with the TUC has reared in a way that has not actually given us any confidence that we can carry on that way in the future. I refer specifically to the way in which the job training scheme was first approved by the TUC when we launched it, and then tried to pull the rug from under it. I refer to the way in which the TUC wrote to me and casted doubts on the veracity of figures produced by the Central Statistical Department of Government. If the TUC wishes to play politics, I am afraid that it has to be treated as politicians and not as another body.
Secondly, at the end of the day it is employers who must take responsibility for training and, I hope very much that we will see that employers will rise to that responsibility.
Q
Lord Young, given what you say about the favourable industrial relations now, why have you decided to go still further on measures about the unions, particularly since two of those are quite strongly opposed by the CBI?
Lord Young
Yes, I appreciate that they have been opposed by the CBI. If you go back and look up the files, that is not the first time that that has happened. But, in fact, where we [end p10] see we have still to make one further step forward in our step by step approach is protecting the individual rights of trade union members. I do not believe that the model is perfect yet. Indeed, there may well be a story later on today showing that the way in which balancing and other things go through the unions are perhaps open to some doubt. What this will do, I believe, will consolidate the advances that we have made.
Prime Minister
We have Ian Lang here who is one of our Ministers in the Scottish Office. Any Scottish press here?
Mr John Cole
Apologies to Mr Lang; I am afraid it is to the Prime Minister. Your earlier answer on direct taxation and indirect taxation in which you seemed to draw our attention to the contrast between the 1979 programme and the present Manifesto—does that mean that you think the move from direct to indirect taxation has now gone far enough?
Prime Minister
You are trying to constrain the Chancellor in making his future Budgets. In 1979, it was policy to have a strategic shift. That strategic shift was in the Manifesto. There is no such strategic shift in this Manifesto. Nevertheless, you know full well that no responsible Prime Minister, Chancellor or Minister could agree to be totally and utterly constrained about making Budgets for the next five years. I will not do so. There is no strategic shift in this Manifesto as there was in the 1979 Manifesto.
Mr John Cole
But Prime Minister, there was a tactical shift some days ago on food. On Friday, you declined to give us anything on fuel and power, but you gave it on ‘The World this Weekend’. What more can we expect this week?
Prime Minister
Zero-rating on food came up during the last election, Mr Cole. We gave the same answer then. It came up in Parliament. It is not new. It is a not a tactical shift. It has been there for ages and ages. I answered a question in the House in 1984. I answered a question on ‘The World this Weekend’ yesterday on the other thing. I have answered a question now. It is not policy to have a strategic shift from the one to the other, but I am not going to constrain any [end p11] Chancellor of the Exchequer. You really cannot attempt in these conferences to make up his Budgets for him in the next five years. The questions I thought material to answer and necessary to answer have, I think, been answered but you cannot make up his Budgets for him.
Mr Tebbit
More important, of course, there is the question of how the Labour Party would finance its £35 billion programme, since Mr Gould admits now that increasing top rates of taxes would not be done to bring in increased revenue, but merely to punish the successful—‘Marxism Today’—this month's issue. Therefore, they would be in the business of raising VAT. You might ask what their proposals are?
Q
Have you subtracted from the loss of jobs in nuclear power the amount of jobs created in the coal industry?
Lord Young
Yes. I am told that, in fact, in order to substitute the power, we would have to import oil which would not be immediately productive of jobs in the short term.
Q
Yesterday, you mentioned that the unemployed live rent-free. Could the Prime Minister explain why the home owner who loses his job is penalised by losing half his mortgage interest rate. It seems odd and vulnerable for someone whom you should be supporting.
Prime Minister
No, he is expected to meet it. Tony Newton, would you like to answer. I think it is for four months, then if he has not got a job after four months, the mortgage relief is met. Tony is now Minister of Health, but he was the Minister of Social Security.
Tony Newton
A proportion of the interest is met for an initial period. It is on the basis that the building societies would, as they normally do, help for a brief period and then the full interest is paid at the end of that brief period. I think that is a policy which is widely accepted as sensible. [end p12]
Q
Are you saying that Labour's plans would destroy 1 million jobs and, therefore, put unemployment up over 4 million? Given the fact that Labour also claims that its policy will create 1 million jobs, I would like to get it clear whether you are saying that we would soon go to 4 million unemployed under Labour.
Lord Young
I hope that we will not have to put that to the test. But what I am really saying is that they talk about a jobs package. This is the hidden part of their Manifesto which is actually destructive of jobs. When it comes on to their job creation jobs as such, they talk about quite a large number of jobs—a few hundred thousand—coming in in construction. Well, if you look at the reports today, there is an increasing shortage of skills in construction. They will not come about. I suspect that we will find that, just as we have seen over the past three years unemployment going up slightly despite the increase of 1 million new jobs, Labour will have to increase far more jobs than they say they will against this background, and you will find unemployment going up, and going up sharply.
Adam Raphael
You will have seen that the Opposition parties have decided to target your character and ability in this election. Is there a Thatcher factor in this election? What can you do to counter the widespread impression that you are not a caring person?
Prime Minister
What they are doing is trying to deflect the debate, the argument and discussion, from the real issues of this election, particularly from their own underlying issues which lay beneath their Manifesto
Side 2—
Mr Brunson
Can I follow that through? Mr Kaufman yesterday talked about what he called the Thatcher values. He said that those values are based on the assumption that all that matters in life is material advancement and the possession of material goods. Would you accept that your policies sometimes give that impression? [end p13]
Prime Minister
No. I had hoped that you had looked, for example, at the speech at Perth. Is not it the most normal, the most honourable and one of the most moral things in life to want to do better for your family and your children, to give them a better start, a better house than you were able to do? Is not it the most fundamental liberty to be able to do that by your own effort and to keep the fruits of your own effort largely so that you may be able to take responsibility for your family? Is not it the most moral thing that you might want to earn more, perhaps to help out your own old folk? Is not it also the most moral thing that you might want out of your own earnings to give things to causes which you wish to help? Is not it significant that charitable giving under this Government has doubled in real terms? Do you call that greedy? Is not it significant that every historic organisation that wants to conserve often has to raise money from those, in fact, who have the effort—made extra effort? Is not it significant that in a much, much more prosperous society that the arts, whether it be the theatre, art, opera, ballet or whether it be gardening, landscape gardening have flourished? Is not it the purpose of many people to get a higher standard of living? Are you saying that the Labour Party is totally anti that? I did not think it was, but it is playing some very strange politics with people who, by their own effort, wish to get on. That is the driving force of society. If more people were able and willing to do it, we should have an even higher standard of living and fewer families in difficulty.
Mr Tebbit
Prime Minister, is not it only right that we should be fair to Mr Kaufman because yesterday following the suggestion of one of Mr Kinnock spokesmen that the Prime Minister had an unbalanced mind and, presumably, after the decision to run an advertisement suggesting that 393 Conservative MPs should have their heads tested which does not seem to be aware of the fact that there are not any Members of Parliament, Mr Kaufman was trying to back-track, as usual, from their policies and paid tribute to the fact that you are not the sort of person that they have been trying to portray. Mr Kaufman is busy trying to back-track.
Q
What do you feel about the comments reported from Mr Biffen at the weekend? Also, have you been in touch with him directly [end p14] or will you be in touch with him during the campaign?
Prime Minister
I have not directly been in touch with Mr Biffen. I have not directly been in touch with quite a good number of Cabinet Ministers. We have all been getting on. We know that our task in the election is to get back with a splendid victory. You seem to ask me this question regularly. You cannot make up the Chancellor's Budget for him; you cannot make up my Cabinet for me. John is just as free to say what he wishes to say as I am to say what I wish to say. He is a very lively ebullient personality and has a very original mode of thought. I am so glad you agree. Now what was the next question? What has happened to the originality of the people before us?
Q
Will we have the pleasure of Mr Biffen 's company at one of these sessions before the election?
Prime Minister
Mr Biffen is not in charge of a Department. Indeed, the only thing that I could say to some of the questions that have been asked had John been here would be “Order, Order” .
Chris Moncrieff
Would the Prime Minister care to express a view on the way events are developing in Tehran. What does she think the Government might do next?
Prime Minister
As you know, we are keeping closely in touch. Of course, the Foreign Secretary and I have spoken about it. We shall keep up pressure in Tehran. We think that the charges against Mr Chaplin are outrageous. The matter here is a matter for the police, but we shall be keeping up the pressure in Iran today and doing everything we can for Mr Chaplin and our people in Tehran.
David Dimbleby
Mr King said, just before the weekend, that Labour's stance was a source of encouragement to Sinn Fein. Do you believe that a Labour Government would be soft on the IRA?
Prime Minister
We can only judge by what some of the more extreme members of the Labour party have done. You know [end p15] what Mr Livingstone did. He went over to Holland when we were trying to extradite convicted IRA murderers back to Britain. You will be aware that he went over and pleaded for him. I have forgotten his precise words. In May 1986, he went to Amsterdam to urge the Dutch not to extradite two convicted IRA terrorists.
You know full well that the Labour Party has repeatedly voted against the Prevention of Terrorism Act. The purpose of that Act is to help the police to apprehend and hold terrorists, so that they may actually take action before the terrorist acts have been committed. You will be aware that they have been very successful in using the powers under that Act. You will be aware that the Labour Party, as a whole, nevertheless votes against that Act. I shall not go any further than that. It is for them to say what their other policies would be.
Andrew Roth
Prime Minister, in a room which is rather small and where you can be seen perfectly from even the furthest corner, you are flanked by two television monitors. Is the reason for that because in this election, this, on the television screen is the reality rather than that, namely, you, and one is supposed to watch television to believe it?
Prime Minister
I really do not think that that calls for an answer, Mr Roth. Do you?