Speeches, etc.

Margaret Thatcher

HC S: [Debate on the Address]

Document type: Speeches, interviews, etc.
Venue: House of Commons
Source: Hansard HC [994/18-28]
Editorial comments:
Importance ranking: Key
Word count: 5853
Themes: Agriculture, Conservatism, Conservative Party (history), Defence (general), Defence (arms control), Economic policy - theory and process, Education, Employment, Industry, Monetary policy, Privatized & state industries, Environment, Pay, Public spending & borrowing, Trade, European Union (general), European Union Budget, Foreign policy - theory and process, Foreign policy (USA), Labour Party & socialism, Law & order, Northern Ireland, Race, immigration, nationality, Social security & welfare, Terrorism, Transport, Trade unions
[column 18]

The Prime Minister (Mrs. Margaret Thatcher)

I am happy to join the Leader of the Opposition in paying tribute to the speeches of my hon. Friends the Members for Wokingham (Mr. van Straubenzee) and Nelson and Colne (Mr. Lee), who moved and seconded the humble Address. My hon. Friend the Member for Wokingham and I were elected to the House on the same day. Since that was 21 years ago, that makes us fellow old Members of the House. My hon. Friend arrived in this place at his second attempt. I arrived at my third.

My researches show that my hon. Friend is the first Church Estates Commissioner to move the humble Address. In that capacity his appearances at Question Time, though infrequent, have become highlights of this Parliament. When my hon. Friend was elected, the usual channels had some difficulty in pronouncing his name. He explained that it rhymed with Mackenzie—and was promptly put on the Scottish Grand Committee. In view of his explanation of the reason why his ancestors came here, that must have been a traumatic experience for him. Nevertheless, he survived.

My hon. Friend mentioned the success of the new town of Bracknell, which has been developed under successive Governments. I appreciate his support for the legislation which is foreshadowed in the Gracious Speech about conserving the countryside for the benefit of us all.

My hon. Friend the Member for Nelson and Colne was elected in May last year. His was the first Conservative gain to be announced. I hope that he achieves his preliminary ambition of achieving 21 years of continuous service in the House. The whole of the Front Bench has a vested interest in seeing that he does. He spoke with real feeling and with deep knowledge about youth unemployment. As chairman of the National Youth Bureau he is well qualified to do so. He referred to that passage in the Gracious Speech which confirms the Government's commitment to an extended programme of employment and training measures for the unemployed, particularly for the young. I shall have something more to say about that later. [column 19]

I was glad that my hon. Friend referred to the success of Coldroll Ltd, the 32-year-old managing director of which said, earlier this month:

“We will emerge from the recession fitter, stronger and healthier.”

He went on to say that his firm's results were proving that already.

It is the custom that the Leader of the Opposition has the privilege of being the first to congratulate the mover and seconder of the humble Address. Of course, the right hon. Member for Ebbw Vale (Mr. Foot) added a somewhat miscellaneous collection of things to that duty. It was difficult to follow him through his grasshopper collection. I shall refer to one or two matters. He referred to the capital reconstruction of steel. The great tragedy was that steel was ever renationalised. Its future would have been very much greater if it had not been.

The right hon. Gentleman referred—or, rather, he did not refer—to restrictive practices in the print industry, a subject about which he knows something. He read references from The Times, scarcely conscious that The Times is under threat because of restrictive practices and that jobs might be lost because people have refused to terminate those practices so that The Times can be profitable.

The right hon. Gentleman also referred to my distinguished predecessor, Mr. Harold Macmillan, and school books. He forgot to say that one of the things that Mr. Harold Macmillan pointed out was that public sector pay was taking so much out of the education service that there was just not enough money left for school equipment and school books and therefore urged that we should spend a good deal less on public sector pay, not that we should spend more overall. That would not be Harold Macmillan. He would not have built up a splendid business unless he had learnt the elementary laws of accountancy.

The right hon. Gentleman seemed to avoid a lot in the Queen's Speech, particularly the parts referring to foreign affairs. He mentioned arms control cursorily and in passing. He did not mention his party's policy on that, and he scarcely referred to Europe. Given his views, that is not surprising. Ever since joining Labour's Front Bench, the right hon. Gentleman has shown the consistency of a chameleon. No one can or should deny his steadfast commitment to the Campaign for Nuclear Disarmament—that is, until he became a member of the 1974 Labour Government. That Government rightly retained Britain's independent nuclear deterrent, and the champion of the unilateral disarmers managed to swallow his principles.

No one can or should deny the right hon. Gentleman's antagonism to Britain's membership of the European Community. He was remorseless in his efforts to prevent our joining the Six.[Interruption.] The European Community and this Government's commitment to it are mentioned in the Gracious Speech. The right hon. Gentleman was content to play a prominent role in an Administration who endorsed and continued our membership of the Community. The trouble with the right hon. Gentleman is that he tends to forget not only what he has said but, when it is convenient, what he did in the last Labour Government.

The Gracious Speech makes extensive reference to foreign and defence matters, and I intend to follow that. [column 20]Today in foreign and defence matters Opposition Members are displaying the irresponsibility that always characterises them when they are deprived of the restraint of office. Once again, they are ignoring the facts. They know that our future is inextricably involved with the fate of our neighbours in Europe, with that of our partners in America and with that of our friends elsewhere. They know, but not many will say so. As a result, their attitude on three fundamental issues—on Europe, on defence and on international trade—is negative and profoundly destructive. [Hon. Members: “What about the Queen's Speech?” ] Perhaps right hon. and hon. Members have not read it. It actually refers to Europe, to foreign affairs and international matters.

If we walk out of Europe, our trade, of which more than 40 per cent. is with other members of the Community, will suffer; our economy will be damaged; and our international effectiveness will be diminished. Today our major problems with the Community are on the way to being solved; our trade with the Community is moving into surplus; and the prospective accession of three newly restored democracies—Greece, Spain and Portugal—demonstrates the appeal of the Community for those who wish to remain free.

Mr. Robert Maclennan

(Caithness and Sutherland): Will the Prime Minister accept that her cause in Europe will be greatly strengthened if she ceases to treat it as a partisan matter in this House? Is she further aware that she carries less conviction today, since 38 of her hon. Friends have organised themselves in direct opposition to her, led by the hon. Member for Southend, East (Mr. Taylor), who was formerly a member of her Shadow Cabinet?

The Prime Minister

I understand that the official policy of Opposition is to withdraw from Europe. Ours is to remain in the Community, and the Gracious Speech refers directly to that. I am speaking to the Gracious Speech. Just when most of our problems are being solved, the Opposition would like to throw everything away.

Let me turn to the next subject to which the right hon. Gentleman scarcely referred. The Opposition are pledged to disarm unilaterally. If we did that, or reneged on our defence commitments, the security of the West as a whole would be undermined. We should be powerless to resist pressure in time of peace and virtually defenceless in time of war.

I come to the third major belief of the Opposition. If we become protectionist, others will retaliate. Our foreign trade—which accounts for a larger proportion of our national product than in the case of any other major industrialised country—will be crippled; the poorer countries with which we trade will be the first to suffer. In all these matters, the policies of the Opposition are deeply hostile to the true interests of the United Kingdom.

There was a time when the right hon. Member for Ebbw Vale expressed in this House the hope that we in Britain would be determined to maintain our influence in Europe. He was right then and he would be right now if he chose to repeat the sentiment. Whether he does or not, we intend to see that our influence is maintained. Since coming into office we have combined a firm commitment to the ideal of the Community with a vigorous determination to defend our national interests. Through tough negotiation, we have achieved a fair deal for Britain on a number of issues—on the budget, on sheepmeat, on conservation of fish stocks.

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Mr. Nigel Spearing

(Newham, South): On fish?

The Prime Minister

We are on our way to achieving more—notably on the common fisheries policy as a whole, the agreement that the right hon. Member for Deptford (Mr. Silkin) was incapable ever of reaching.

Mr. John Silkin

(Deptford): Perhaps the right hon. Lady will be fair enough to recognise that the reason why I was incapable of reaching such an agreement was that I was unwilling to surrender British waters to the EEC.

The Prime Minister

The reason why the right hon. Gentleman was incapable of reaching an agreement was the right hon. Gentleman.

In the second half of next year we shall hold the presidency of the Community, just when the Community will be deciding how to restructure its budget. We intend to take advantage of the occasion to press for the long-term financing of the Community to be put on a sound and equitable basis.

Let me stress the Government's belief—this will be most important during the coming year—which is shared by the Governments of France and Germany, that the necessary reforms can and will be achieved within the limits imposed by the 1 per cent. ceiling on VAT receipts. The Community's budget, like the budgets of the member States, must be restrained.

The right hon. Gentleman scarcely referred to East-West relations and defence, although they are vital to the future of our people. The security of Europe is indissoluble from that of North America. Governor Reagan has already made it clear that he attaches the highest priority to the maintenance of a confident and powerful alliance. On the Government Benches we welcome that. It creates the right basis for close co-operation and partnership between Europe and America. Proposals from the Labour Party to weaken the alliance—and there are plenty—are irresponsible in the highest degree. Michael FootThe right hon. Gentleman was once an anti-appeaser: I fear that he is now an arch-appeaser.

We, for our part, will maintain Britain's contribution to NATO. Despite the economic difficulties, we shall achieve or come very close to the 3 per cent. target in each of our first two years in office and will continue to increase defence expenditure in the coming years. Let those who say that that is too ambitious look again at the growth in the Warsaw Pact's military expenditure in the last decade and ponder the Soviet invasion of Afghanistan.

As for nuclear weapons, the Government have made their decisions and will stick to them. Of course, we recognise the dangers of an unrestricted arms race. Of course, we are anxious to reach agreement on arms control measures, to which Michael Footthe right hon. Member for Ebbw Vale referred. But we intend to approach any necessary negotiations as an equal partner and not as a supplicant. The right hon. Gentleman—like all the unilateralists—is deluding himself if he thinks that mere eloquence, earnestness or example will win concessions or respect from the Russians. They will not. Such delusions are dangerous.

Protectionism is another delusion, first because retaliation is a reality, not a vague spectre. Recently we imposed quotas on textile goods from Indonesia worth just £3 million per year. We now find that this has lost us major orders for construction projects and for exports of high [column 22]technology worth well over £100 million. We cannot afford to lose the world markets on which so much trade and so many jobs depend.

Worse still, protectionism would do no more than disguise our problems—and then only briefly. Imports enter this country because industry or the consumer wants to buy them. The advocates of import controls are saying to the purchaser “You cannot have the cheapest, you cannot have the best, you cannot have the most modern—all you can have is what we make here.” That is a recipe for discouraging British industry from being competitive, for slowing down change, and for increasing prices. It is also a declaration of total lack of faith in British industry.

Of course, we do not ignore the pursuit by other countries of unfair policies that discriminate against our manufactures or damage our industries. While we shall always seek to resolve such problems first by discussion rather than by retaliation, we shall insist that free trade must be fair trade.

Mr. Jack Straw

(Blackburn): I appreciate the genuine difficulties of retaliation that exist in respect of textile imports. However, is the right hon. Lady willing to ensure that the Government will provide the same level of aid for our textile industry as the Dutch, the Belgian and the French Governments are providing for theirs?

The Prime Minister

First, some of those decisions are not yet through. Secondly, some of the aid provided is much less than the total already provided to the British textile industry.

The Gracious Speech then moves on from foreign and defence matters to the economy. The right hon. Gentleman has attacked the Government's economic policies in the disingenuous manner that characterised his performance as an economic Minister in the first two years of the previous Labour Government. Surely he is not seriously saying that we should leave the oil in the ground with all the catastrophic consequences for jobs in Scotland. Nor is he seriously saying that Michael Edwardes said that—of course he did not.

The right hon. Gentleman was the architect of the so-called social contract, whereby the trade unions got everything they wanted without delivering anything of lasting benefit in return. He was the advocate of the dangerous myth that we could spend our way to prosperity. Aided and abetted by the right hon. Member for Leeds, East (Mr. Healey), that brought the country to the highest inflation rate in modern times, the imminent threat of national bankruptcy, and finally the IMF. By that time, the right hon. Gentleman was no longer in charge of an economics Department.

If the right hon. Gentleman would look at the facts, he would find that the whole industrial world has moved into recession largely because of last year's doubling of oil prices. For example, 900,000 jobs have been lost in the United States motor industry this year, and industrial output in Germany has fallen by 5 per cent. The whole world has been affected by the world recession. So although our exports have performed better than anyone predicted, our industries—like everybody else's—have inevitably suffered. The right hon. Gentleman would also find that our loss of competitiveness over the past two years has mainly been not because of the exchange rate but because our labour costs have risen nearly twice as fast as [column 23]those of our competitors. People have been taking out more than they have earned, and many thousands have lost their jobs as a result.

Mr. Austin Mitchell

(Grimsby): Will the Prime Minister accept, in all this prating, that this year the pound has risen more than earnings?

The Prime Minister

With all due respect to the hon. Gentleman, that does not defeat my argument in any way. The main reason why we are having difficulty with exports is the loss of competitiveness because people have failed to match pay and productivity.

The right hon. Member for Ebbw Vale would have us think that the Government could have prevented sterling from appreciating. He knows that North Sea oil is the principal cause of sterling's strength. He ignores the experience of his right hon. Friend Denis Healeythe Member for Leeds, East, who, in November 1977, was forced to abandon the pretence that he could hold out against market forces and hold down sterling. He ignores the fact that while many industries have found the strong pound difficult to cope with, some have benefited from it, and that the country as a whole has benefited from lower prices. He seems to have forgotten that the damage caused by the collapse of the pound under his Government in 1975 and 1976 far outweighed its transitory benefits.

Finally, the right hon. Gentleman seems to have forgotten that this country has been bedevilled for the past 25 years by a rising trend of unemployment—a trend that has been caused by the underlying weakness of our industrial economy and the fact that we have just not been sufficiently competitive. The average level of unemployment was only 300,000 in the first post-war Conservative Government; it was almost 500,000 during the Labour Government of 1964–70, almost 750,000 during the last Conservative Government, and 1.2 million under the last Labour Government. [Interruption.] Of course, Opposition Members do not like that. We started the current recession from the base that they left us of 1.3 million unemployed.

Mr. Michael English

(Nottingham, West): I welcome the Prime Minister's—[Interruption.] The right hon. Lady's supporters must be short of something if they have to cheer me. They should be cheering her. I welcome the right hon. Lady's desire to keep down costs and to protect British industry from imports. Why does she not believe in keeping agriculture competitive? Why does she not believe in keeping British food cheap?

The Prime Minister

British food is very much cheaper than the remainder of the items in the retail price index. Food has risen far less than the retail price index as a whole. The worst offenders in the retail price index are those Socialist industries, the nationalised industries.

None of us denies that rising unemployment and falling production present a sombre picture. Where we disagree is about the cause and the cure. There are no magic or quick solutions. What this Government can and will do is to create the conditions in which, when the world economy recovers, the seemingly endless cycle of economic decline can be broken. Meanwhile, because we are all deeply concerned about unemployment, especially among young people, the Government will be introducing new [column 24]employment measures. The right hon. Member for Ebbw Vale asked me to say a few words about that. I shall do so, although the details will be given by my right hon. Friend James Priorthe Secretary of State for Employment, who hopes to make a statement tomorrow.

Mr. Alexander W. Lyon

(York) rose——

The Prime Minister

I am about to announce the measures, and I wish to continue. As a result of the review that I promised in the summer, we have decided to expand the youth opportunities programme next year. We are asking the Manpower Services Commission to aim to provide 440,000 places on the programme next year—180,000 more than for the current year. On the basis of that expansion, we are asking the commission to improve the present undertakings to employ young people. My right hon. Friend James Priorthe Secretary of State for Employment will give further details to the House tomorrow.

To mount that programme, the commission will need the fullest support from employers, unions, voluntary agencies and local authorities. There will also be changes in other special employment measures, which will be covered in my right hon. Friend's statement. In total, the Government have allocated some £570 million to these measures in 1981–82 in place of the previously planned expenditure of just over £320 million.

Mr. Guy Barnett

(Greenwich): That is a U-turn.

The Prime Minister

I hope that that announcement will be welcomed in all parts of the House. Of course, they are temporary measures to alleviate the present difficult position. They will not solve the long-term problem. Our first task will remain that of bringing down the rate of inflation. We took over when the inflation rate was accelerating. It is now coming down rapidly.

Mr. John Maxton

(Glasgow, Cathcart) rose——

Mr. Speaker

Order. The hon. Gentleman must not remain on his feet.

Mr. Maxton

I am sitting down.

Mr. Speaker

Only because I stood up. Does the Prime Minister intend to give way?

The Prime Minister

As the hon. Member for Glasgow, Cathcart (Mr. Maxton) is new, I shall give way.

Mr. Maxton

I am grateful to the Prime Minister. She says that the Government are keen to fight inflation. Will she explain why the copy of the Gracious Speech costs 70p this year when it cost 25p last year? That is a threefold increase.

The Prime Minister

The reasons are public sector pay and restrictive practices in printing.

Our first task remains to bring down the rate of inflation. We took over when inflation was accelerating. The figures show that. It is now coming down rapidly. The latest annual figure of 15.4 per cent. is below what my right hon. and learned Friend the Chancellor of the Exchequer forecast at the time of the Budget, and during the past six months retail prices have risen by only 4.3 per cent. Our aim now is to bring down our inflation rate to below that of our competitors. Only then will our industries regain some of the competitiveness they have lost. That is just what we would not get if we were to listen to the call from Opposition Members for reflation. They want still more spending, ever more borrowing and lower interest rates—a sure recipe for higher inflation. [column 25]

If pumping more money into the economy was the answer to our problems, we would have solved them long ago. However, pumping more money into the economy has not solved the problems of the car industry, for example, on which so much else depends. Ten years ago, we built 1.7 million cars and new registrations were only 1 million. Last year, the position was almost exactly reversed. New registrations amounted to 1.7 million and production only 1.1 million. It has not been lack of demand that has caused problems for industry; it has been the failure to build cars that people want and at a price that they are prepared to pay. Lack of demand is not the problem. It is the inability to fill that demand in Britain. Therefore, pumping in extra demand is just not the answer.

We must get both inflation and interest rates down. That is why the Government have been conducting a searching review of public expenditure. I hope that the right hon. Gentleman will be pleased if my right hon. and learned Friend the Chancellor of the Exchequer makes a statement on Monday, which I am sure he will seek permission to do. There has been vastly increased spending on public sector pay, we are massively overspending on the nationalised industries and we are spending more on social security.——[Hon. Members: “What about unemployment?” ] I am about to come on to that point. Opposition Members should be patient. Higher spending on social security is the inevitable consequence of the recession. However, the problems of the nationalised industries go much deeper.

Mr. Kevin McNamara

(Kingston upon Hull, Central) rose——

The Prime Minister

I am sorry, but I must get on. There is a legacy of years of overmanning and inefficiency for which we are all now paying dearly. Indeed, the amount that the taxpayer is now having to find to support these industries is equal to more than three-quarters of our North Sea oil revenues this year, or, alternatively, equal to 4p on the standard rate of income tax. That is why we are determined to open up as much of the nationalised industries as we can to the competition and discipline of the private sector.

We made a good start in the last Session. We are committed to going further, and this Session we shall bring in legislation affecting transport, telecommunications, posts and the British National Oil Corporation. The Transport Bill will enable British railways to introduce private capital into non-railway activities and allow private investment in a reconstituted British Transport Docks Board. The British Telecommunications Bill will create a new corporation to run the existing telecommunications and data processing business of the Post Office. It will provide powers to reduce the postal and telecommunications monopolies—much overdue—and to encourage partnerships with private capital, also overdue. These changes are essential if this country is to take full advantage of the information technology revolution. The petroleum and continental shelf Bill will provide powers to enable the British public to participate in the BNOC through the purchase of equity shares.

The third reason for reviewing spending plans is that the pay bill for the public services has gone up by some 50 per cent. in two years.

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Mr. Guy Barnett

The House would be grateful if the Prime Minister could say something in response to my right hon. Friend about the firemen.

The Prime Minister

I have said a great deal about the firemen at almost every Prime Minister's Question Time, and I expect that there will be a great deal more to be said. The facts have not changed. I intend to make my own speech today, just as the right hon. Gentleman did.

I was in the midst of saying that in the last two years alone, public sector pay has gone up by 50 per cent. in total. We have scrupulously implemented the Clegg comparability commitments, and public servants have at least caught up—many would say more than caught up—with pay in the private sector. But industry has had to pay the price in terms of both higher interest rates, because of higher Government borrowing, and, as a result, lost jobs. That is why we are determined to see much lower public service settlements from now on.

Besides getting inflation down and curbing the public sector, our other major task is to make our market economy work more efficiently.

Mr. Bob Cryer

(Keighley) rose——

The Prime Minister

I must get on. Years of nationalisation, controls, high personal taxes and entrenched and over-powerful trade unions have left their mark. Enterprise and initiative have been stifled, and we have failed to adapt fast enough to changing technology. Too much protection of yesterday's jobs has been at the expense of tomorrow's. We have already made a start at overcoming these problems. We shall continue to do everything that we can to make our economy more responsive to the opportunities that lie ahead—by reducing controls through tax incentives, by increasing competition and by encouraging the new technology industries.

I have outlined some of our proposals for legislation in the economic sphere. The Gracious Speech also sets out other measures which we shall bring forward. I should like to mention a few of them now and to say a little about them.

Mr. Clinton Davis

(Hackney, Central): The House will be interested to know how the right hon. Lady squares what she has said about public sector pay with the unqualified commitment given by the Home Secretary in 1978, a matter which she has studiously ignored.

The Prime Minister

Perhaps the hon. Gentleman will read the answers that I have already given again and again on this question. Any further answer that I gave would be the same, and I do not believe that we benefit from repetition.

The right hon. Gentleman referred to the nationality Bill. We promised that we would introduce legislation on nationality to define entitlement to British citizenship and the right of abode in this country. Last July, we published a White Paper containing an outline of the proposed legislation, and we shall introduce a Bill shortly.

My right hon. Friend the Home Secretary will also bring forward a criminal attempts Bill which, among other things, will repeal the “suspected person” offence. We have been concerned that its simple repeal might leave an unacceptably wide gap in the criminal law. The repeal of “sus” will, therefore, form part of a Bill which will reform the law of attempt and ensure that the public is properly protected. [column 27]

In education, we propose to amend the law governing special education in the light of the Warnock report, which I and my hon. Friend William van Straubenzeethe Member for Wokingham set up when we were at the Department of Education and Science. Our proposals will give the parents of handicapped children rights to early consultation about their children's education and will extend the appeals machinery of the Education Act 1980 to include them.

Mr. Jack Ashley

(Stoke-on-Trent): rose——

The Prime Minister

The Education (Scotland) Bill will make parallel provisions for special education in Scotland. It will also provide for the extension of the rights of parents to choose a school for their children. That is much-wanted and much-needed legislation in Scotland.

Another of the measures that we shall introduce will make employers responsible for sick pay in the early weeks of sickness. The right hon. Gentleman made some comments about that. Our proposals have been substantially amended in the light of comments on the Green Paper “Income During Initial Sickness” . These amendments will concentrate particularly on the problems of small businesses, and my right hon. Friend will be explaining the proposed scheme in detail later in the debate.

The Transport Bill will include measures to tackle two of our most serious and urgent road safety problems—drinking and driving and motor cycle safety.

We had hoped to bring forward legislation on Northern Ireland. For many months the Government have been seeking agreement in the Province to bring forward proposals for a substantial transfer of responsibilities to elected representatives of the people there. That agreement has not been forthcoming. Therefore, we are now considering other ways of making the administration of the Province more responsive to local needs, and my right hon. Friend will report further to the House in due course.

Let me make one point about the hunger strike in the Maze prison. I want this to be utterly clear. There can be no political justification for murder or any other crime. The Government will never concede political status to the hunger strikers, or to any others convicted of criminal offences in the Province.

Mr. McNamara


The Prime Minister

Finally, I return to the economy, on which all else depends. I shall give way to the hon. Gentleman.

Mr. McNamara

I am grateful to the right hon. Lady for giving way on this point, particularly because of the last issue that she raised. She is obviously right that if a person is properly convicted before a judge, with a jury, and with properly corroborated evidence, that person should not be given any degree of political status—or, indeed, any status—for the infamous crime that he has committed. But in Northern Ireland there is effective bending of the rules of evidence, and those people, whether or not they have committed political crimes, are different. Therefore, will the right hon. Lady say whether she will restore the same degree of trial for all offences in the Six Counties as exists in the rest of the United Kingdom?

[column 28]

The Prime Minister

Both Labour and Conservative Governments have had to make modifications to the legal systems for the protection of the people of Northern Ireland. I supported the Labour Government when they needed to introduce those modifications and, for the greater part, they have supported us. In the light of that, I wanted to make the position clear. There can be no such thing as political status for people convicted of criminal offences in the Province.

Mr. Merlyn Rees

(Leeds, South): Is the right hon. Lady aware, as the person who ended political status, that her words are right and that they should be heard throughout the world? [Hon. Members: “Hear, hear.” ] But shortly after it was ended we looked at the Northern Ireland emergency provisions legislation. Is it not time that we looked at it again and examined some of the points that have been made by my hon. Friend the Member for Kingston upon Hull, Central (Mr. McNamara)? We agree that in no way should there be political status for anyone, but we should at least look at the legislation again.

The Prime Minister

I understand that that legislation is automatically looked at every six months.

Finally, as I have said, I return to the economy because all else depends on it. The Opposition's prescription for the country's problems is that we should spend more money—money that we do not have. That might relieve unemployment in the short run, but the cost would be another, larger surge in inflation, leading to yet another decade of unemployment.

The British people are fed up with phoney palliatives. They have always known that the Government cannot create wealth and that they can only draw on the wealth created by others. Attitudes are changing. Managers are once more managing; trade unions and their members are acknowledging that pay increases have to be earned. Exports have done well despite the pound's strength. The balance of trade is good. The number of strikes has fallen dramatically. We are the only major industrial nation self-sufficient in energy. Rising revenues from North Sea oil will give us the opportunity to promote real growth in the economy.

We have got inflation right down. [Interruption.] We have got inflation down from its previous heights, and we intend to go on. [Interruption.] In the last six months it has been right down. I agree that on the annual basis it is not yet right down. When we have got inflation, on the annual basis, right down, when we have achieved better productivity, when we have realistic pay settlements, we shall see a real revival in our country's fortunes.

Nations overseas are applauding our new strength and resolve. [Interruption.] They have found again their confidence in Britain. So long as we do not flinch from our responsibilities, neither they nor our people will be disappointed. We shall carry through the task that we have undertaken. There is no other way to success.