Speeches, etc.

Margaret Thatcher

TV Interview for Thames TV TV Eye ("Challenge to the Tories")

Document type: Speeches, interviews, etc.
Venue: No.12 Downing Street
Source: Thames TV Archive: OUP transcript
Journalist: Alastair Burnet, Thames TV
Editorial comments: MT returned to No.10 at about 1930. Copyright in the broadcast from which this transcript is taken is retained by Thames Television and the transcript is reproduced by permission of Thames Television.
Importance ranking: Major
Word count: 3936
Themes: Defence (Falklands), Economic policy - theory and process, Employment, Industry, Elections & electoral system, General Elections, Monetary policy, Privatized & state industries, Pay, Public spending & borrowing, Taxation, Foreign policy (International organizations), Health policy, Labour Party & socialism, Law & order, Liberal & Social Democratic Parties, Leadership, Society, Social security & welfare, Strikes & other union action

Alastair Burnet, Thames TV

The leader of the Tory Party, Margaret Thatcher. Seven days to go - and can the Tories retain their commanding lead?

Theme music.

Alastair Burnet, Thames TV

Good evening. Tonight our opinion poll shows that the Tories are increasing their lead over Labour, but also increasing is the share of the vote taken from both parties by the Alliance. For TV Eye the Harris Research Centre asked “How would you vote today?”

Conservatives said 46 per cent; Labour 28 per cent; the Alliance 24 per cent and others 2 per cent, which gives the Conservatives a lead over Labour of 18 per cent. So as we begin the last week of campaigning, how do voters see individual Conservative policies and in particular, Mrs Thatcher, whom I'll be interviewing in a moment. Here's Peter Gill.

Peter Gill, Thames TV

There is no doubt that this is Mrs Thatcher's election. We asked a thousand voters across the country yesterday what factor was putting the Conservatives ahead? Why would people vote Conservative? Was it because of an experienced team of ministers, or Tory policies, or Mrs Thatcher's leadership?

Experienced team of ministers said just 11 per cent. Conservative policies said 31 per cent. But a majority—46 per cent—said it was down to Mrs Thatcher's leadership. Yesterday that leadership came under the bitterest attack of the campaign when Denis Healey accused her of “glorying in slaughter” . The same day we were asking whether the Falklands factor was helping or hindering the government's chances? It makes no difference, said 37 per cent. Hindering the Conservatives—13 per cent. But helping the Conservatives 44 per cent, and it's that majority that Labour is now trying to assault. On the major theme of the election campaign so far—unemployment—not everything has been going Mrs Thatcher's way. We asked which of the party leaders cared most about unemployment? Mrs Thatcher said 21 per cent. Mr Steel said 21 per cent, as well. But Mr Foot said 35 per cent—welcome light in the campaign gloom for him. Finally, we identified what could be a major problem for the Conservatives in the final week of the campaign. We put it this way: if the Conservatives win most seats in the next Parliament, which Tory majority would most benefit the country? A landslide, a small Conservative majority or the Alliance holding the balance of power. Landslide, said 26 per cent. A small majority, said 25 per cent. The Alliance holding the balance said 41 per cent—a majority for moderation. Of Conservative voters a landslide was favoured by 48 per cent, but 36 per cent favoured a small majority. So grounds here for some concern at Conservative Party headquarters, that a good number of Tory voters share the worries of Francis Pym and others about a Thatcher landslide. And it is that factor—as well as Labour's performance—which could be helping the Alliance.

Alastair Burnet, Thames TV

There is a warning for you, isn't there Mrs Thatcher, in that poll—that so many people want the Alliance to keep you tame?

MT

I don't need the Alliance to keep me tame. Uh, we have clear policies. We've set them out very clearly. People know that we carry out our policies and that we give a firm lead. It doesn't matter what the majority. The manifesto is not altered. Uh, naturally I would like to have a large majority; it gives one more authority overseas, but the manifesto that we carry out is precisely the same manifesto whether we have a large majority or a small one.

Alastair Burnet, Thames TV

Are you obsessed by getting a large majority?

MT

Obsessed? No, I'm not obsessed by it. But you can't vote for a large majority, a medium majority or a small majority, you can only vote Conservative, or Labour, or Alliance. And if you want to make absolutely certain that you do not have a Socialist government then you have to vote Conservative. And that has to be in each and every constituency. There's no such thing as thinking: “well, I'd like a majority of people to vote Conservative, but I'm not going to” . That would be very very foolish, and were people to do it on any scale at all they couldn't blame themselves if they got a Socialist government, as they did in February 1974.

Alastair Burnet, Thames TV

Now, you've been making that point in your campaign, and your ministers have turned their fire on the Alliance. Are you getting a little nervous?

MT

No, I'm not getting a little nervous. Because that poll I think which you have just given, I think cannot have been more than about 2,000 people, maybe 1,000—I don't quite know. But usually polls question only between one and two thousand people. The poll I'm interested is 41 million people. And I just don't think a sample of that size can be anything like as sensitive as the interpretations that people are putting upon it.

Alastair Burnet, Thames TV

Why have you refused to have a public inquiry into the sinking of the Argentine cruiser, Belgrano?

MT

Because there is absolutely no need to have one. The advice was that this was a danger of our ships—particularly to the…whole of our carrier group. Don't forget that the only air cover was from Hermes and Invincible. That was the advice, and so indeed we altered the rules of engagement to enable the Belgrano to be sunk. We had previously, several days before, indicated that the warning—to the Argentines—extended far beyond the Exclusion Zone. Indeed, it had to. There was an aircraft carrier group to the north, a cruiser group to the south; I had a very very long supply line, they had submarines—we didn't know where they were. You have the luxury of knowing that we came through all right. I had the anxiety of worrying how can I protect on Hermes, Invincible, the air cover and the number of soldiers which were being carried on vessels which were going down there.

Alastair Burnet, Thames TV

What was your knowledge of the state of the negotiations to try to get a peaceful Argentine withdrawal from the Falklands?

MT

The talks I think with Al Haig had, uh, been completed. We did not hear that there were Peruvian proposals until after the Belgrano had been attacked. And you know, it's ridiculous actually to call them “Peruvian proposals” . When eventually agreed to what was called the Peruvian police…uh, the Peruvian peace plan, it was very sketchy indeed. No one even after that could have called them “proposals” —just a few sketchy suggestions. But in any event it did not reach London till after the attack, and of course after that we did try to negotiate for another fortnight. We tried very hard. First, with the Peruvian proposals and then with the United Nations. And eventually, you'll remember, we put down on our own proposals on the table and said “look, either you accept those or else we withdraw all proposals and then we must try to make a landing” .

Alastair Burnet, Thames TV

But weren't you a little bit afraid that the international negotiations might have meant that Britain had to give, in your judgment, too much?

MT

I don't understand what you mean.

Alastair Burnet, Thames TV

Was it not possible that in the course of negotiating the Argentine troops' withdrawal from the Falklands, you would have had to make some concessions about sovereignty, and you were reluctant to do that?

MT

I would not have given too much. We were prepared to have an interim arrangement, as you know, through the United Nations. Uh, and we were prepared for both the Argentinians to withdraw and for our forces to withdraw to the same distance away from the Falkland Islands as the Argentinian mainland. That was an interim period during which the ordinary administration of the island would have continued. It's all, as you know, in the proposals which we put forward, so I don't need to detail it. There would have been an interim period. But always in our minds was this: we have no doubt about our sovereignty. But above all the people of the Falkland Islands have the right to determine their own future. So—well, you saw from our own proposals, we were not prepared to give away too much, but we were prepared to give something in the interim to stop the fighting. The reason why our proposals were not accepted, is because the Argentines refused to withdraw from the Falkland Islands. That didn't surprise me. I somehow never thought a dictatorship, having gone and invaded and piled in forces and equipment, would actually withdraw. And they didn't.

Alastair Burnet, Thames TV

But the point put by your critics is that all those proposals were torpedoed with the Belgrano.

MT

No! They are historically wrong, indeed they are chronologically wrong. After the Belgrano was torpedoed we carried on negotiating for a fortnight, and the main negotiations, you'll remember, were through the United Nations, through Perez de Cuellar, and surely you remember seeing those films of Sir Anthony Parsonsour most excellent Ambassador walking in and out of the United Nations, day after day? And then he and Sir Nicholas Hendersonour Ambassador to the United States came over here and we actually drew up our proposals. That was way after the Belgrano was torpedoed.

Alastair Burnet, Thames TV

On the economy, after four years of your government, how is it that industrial production is down nearly 12 per cent and manufacturing production down nearly 19 per cent?

MT

Prime Minister [speaking faster] But the, uh, gross national product is only down by one point, from 108 to 107. I think it is a mistake to think that the whole wealth of a nation rests in its manufacturing capacity. A great mistake. As you know full well, in the last ten years there have been more jobs going to services and leaving manufacturing. And, of course, we have this tremendous asset of oil in the North Sea, and if people are working in producing oil and extracting it, and in all the services attached to oil, and are also working in the service industries, naturally they themselves are going to buy more manufacturing goods, some of them imports. So the gross national product, I think the last quarter of the Labour Government, was something like 108.3 and in the last quarter now it is 107.2, and that's after a very very bad world recession. The manufacturing industries that have been hit worst are those which have been most inefficient, and I'm afraid some of our manufacturing industries were inefficient—less efficient than the Germans, less efficient than the Japanese, so when hard times came, they got more of the business and we got less. But we are the party that is trying to put that right. And indeed in our time productivity is up by 14 per cent, inflation down to 4 per cent. That is very very good news for all of those who work in manufacturing industry.

Alastair Burnet, Thames TV

But didn't you make the recession worse for British firms and British workers, because you allowed to pound to go up to almost lethal levels and you kept up the rate of interest?

MT

We could not, indeed, stop the pound from rising, unless of course we had had very very low interest rates. Whether that would in fact have stopped it, I doubt at that time. Because as you know the price of oil was rising and rising and rising—almost two dollars every two months—and we were an oil currency and we believe that's why the pound went up so much against the dollar. And of course if we'd had had very very low interest rates, then I think the inflation would have rocketed. And to have inflation rocketing wouldn't have helped British manufacturing industry either, because not everyone exports. It would damaged manufacturing industry, damaged its competitiveness, it would have damaged everyone's savings, and it would have damaged the long-term interests of trying to get jobs. So yes, you do have to choose, but it is in the long-term interest of jobs, in the long-term interest of manufacturing industry, and in long-term interest of everyone of those people who are now at work, and that's 23½ million, to get inflation down. If we hadn't, I believe that the unemployment would be even worse now than it is, because it would be hitting many of those who at present have jobs and who naturally wish to keep them.

Alastair Burnet, Thames TV

How is it that after four years of your government everyone—except the very rich—is having to pay more in taxes than they did before you began?

MT

Mr Burnet, that is not true. That figure is not obtained by looking at income tax, it is obtained by adding the national insurance contribution. The national insurance contribution is not a tax. It is a premium people pay to ensure that when they are retired they have a pension, if they are unemployed they have unemployment benefit, if they are sick they have sickness benefit. And because it is an insurance premium that is why people get it as of right, and it is not means tested. If you look at our record on income tax, you will find that we have put up the personal reliefs by between five and six per cent, uh, and that takes into account the rise of prices as well—over and above the rise in prices. We've found that the standard rate of income tax, which they had put up actually to 35 pence, but then they lowered it to 33 pence. We reduced that to 30 pence. We found that top management and people who could create businesses were paying an overwhelmingly higher rate of income tax than they were in other countries. We promised we'd reduce that average rate to the average of the other European countries, and we did. And if you look, net take home pay, which is what income tax is all about—how much income tax is taken off your average earnings—it actually sunk by 8 per cent under Labour. It actually rose—net take home pay, after tax—by 4 per cent under us. And so for the people who have been in work, the overwhelming majority are better off. Now, you come to the national insurance contribution. Yes, because we've put up pensions, um, and there are now 600,000 more pensioners, because there are more people of retirement age. Yes. we have had to put that national insurance contribution up. Had we listened to Labour's promises it would have gone up even more. But it is not a tax.

Alastair Burnet, Thames TV

Do you agree with those of your advisers who say that the cost of the welfare state is now so great that you can't afford to cut income tax?

MT

Uh, yes, we have cut income tax, in the way that I have indicated. I believe that as we get expansion, and it is starting, as you know, it is starting very slowly, but it is starting, I would like very much to ensure that a goodly proportion of the expansion goes back to people—to individual men and women and to companies. Because I believe they spend it better, they spend it more economically, companies can then plough it back, to have better investment in the future. I believe after all in the limitation of government and that the citizen should have progressively more rights. Of course, we have also had to cut tax on business, we had to cut the national insurance surcharge, but 2,000 million pounds—Labour put it on. If we'd been able to put that to reducing personal income tax, it would have gone down even more. But when the expansion grows, a goodly proportion of that must go back into individuals, and families and companies.

Alastair Burnet, Thames TV

In that expansion, Mrs Thatcher, and while the recession is still with us, what is wrong with getting people to repair the motorways, repair the sewers, build the new prisons, all the things that are going to have to be done. Why can't you do that now, and push it along?

MT

Well, they are indeed repairing the motorways, and there is a very good road programme. We have got the first programme for building prisons that any government has had for a long time, and we have got a major programme for building hospitals, uh, so we are doing those things, indeed I think the railways underspent their investment programme. And you know there was a time I had to call in, uh, local authorities and say “look, you're underspending on your capital” . So we are doing that. But if I spend more, over and above, what we're spending now, I have to get it from somewhere. I either have to get it by taxing, either individuals or companies, more. That means if we take it away from tax, we're taking it away from what those people would spend it on, or save it to invest in private industry. Alternatively we try to borrow more, and then we put up the interest rates. And that means that all the companies who want to borrow to expand, have to pay more for their money. And nothing aborts a recovery more quickly than high interest rates. So it would not work, because to do that you have to add to the tax on people, and they already think they are paying enough tax, and I rather agree with them, or have to add to the tax on companies. Well, Labour did that. That's why we had a national insurance surcharge. And my goodness, what a relief it is to companies to take down their costs. That helps them to recover. So if you look at it, it is just not possible, and yet still have a recovery, which we most earnestly want and need, and which will come through our productive industry.

Alastair Burnet, Thames TV

There is nothing in what you've said, Mrs Thatcher, to give encouragement that unemployment will be anything other than up a year from now.

MT

I think there is a very great deal, Mr Burnet. May I go through it? Inflation is down to 4 per cent, something like the level of our major competitors—Japan, Germany, lower than France. That gives our industries a better chance to compete. Interest rates are down. That also gives our industries a better chance to borrow money to expand. We have tried to help small businesses very much, tried to help them when they want to expand and they haven't really got any money to back the expansion with, so we have given them a loan guarantee scheme. That helps them to expand, and you know your jobs tend to come from small businesses and expansion. We have tried to encourage new technology, because you know we're very good at it. We've been marvellous at research, uh, and our great drawback is that while we've been firsts in inventive genius, we haven't been firsts in translating it into production. So we have said, “all right we will give a grant, of, uh, about a third, to enable new products to come to the market” . And we've got training schemes—enormous training schemes—to make certain that our young people are trained for these new products. Now all of that is very very positive. All of that is saying we've got the new ideas, we've got the inventive genius, let's keep down the costs on industry and let's help, uh, the small business to expand and the new products to come onto the market. That's the way to do it, and that's the way this government is doing it.

Alastair Burnet, Thames TV

But you're stil not confident enough to say that unemployment will be other than up next year?

MT

That depends upon how far those opportunities are taken advantage of, and how far people themselves strike to try to get more money for themselves without getting more output. I was deeply distressed at the British Leyland strike. The British taxpayer has poured in more money to British Leyland. It's financed the Maestro, and it find, uh, the…the the small one. Financed both of those and yet British Leyland went on strike for four, five or six weeks. They were damaging their own interests, they were damaging Britain's interests. I can't stop them from doing that. All I can say to them is that if you do that, if you strike…after all, in coal there is a 500 million subsidy into coal—oil provides some of the subsidies, of course—but coal doesn't pay its way. The British taxpayer pays 500 million into coal as a subsidy. If they then, uh, demand more and more, then, um, it makes it very much more difficult to get more jobs. We give the opportunities: we hope that people will avail themselves of them. I believe they are doing. Because it you look the strikes are not coming in the private sector. The strikes are coming in the public sector. They came in docks, they came on railways, um, they've come, um, a number…

Alastair Burnet, Thames TV

[Interrupts]In the Health Service because they felt they were under paid.

MT

Prime Minister…in the Health Service, in the Health Service because they felt they were underpaid. But that only means that we have to take more money out of the private sector. They have in fact had increases in the Health Service, as you know. Indeed I think we have been very reasonable about the increases they have had. Not only have they had increases there, but we have got 56,000 more nurses there, we have got more doctors—5 to 6,000 more doctors. Now that means we have more of those and we have to pay them. We indeed—the British taxpayer is paying—let me just give the figures. When we came into power the cost of the National Health Service was £7¾ billion. Now the British taxpayer is paying 15¾, 15½ billion pounds. That is up by far more than inflation. If I am to take more out of companies and out individuals, and away from individuals, to put into the Health Service, they have less with which to buy goods and companies will have to put up their costs. That would not help British industry.

Alastair Burnet, Thames TV

After four years of your government, crime is increasing and elderly people are perhaps more frightened than ever to walk in the streets. That's not what you promised.

MT

We promised to do everything we could to reduce crime. We promised to put the police services to full, uh, amount. As you know there are now 9,000 more trained police than when we took over.That is good. It takes some time for that to work through—work through in training, work through to the police forces—9,000 and many of them are up to their full complement. We have managed therefore to get more bobbies back on the beat, and that is good. [pauses] We cannot say [pauses] then say just how that will act, locally. But it's our job to try to get more bobbies on the beat, to try to get the number of police up. We have done that. And as you know instead of having so many of them going about in cars, they are now actually back on the beat. So I believe that we are doing actually everything we can. I believe it will take time to work through.

Alastair Burnet, Thames TV

Finally, do you not now rule a more divided nation than the one you took over?

MT

Prime MinisterNo, indeed, I do not. I would say that I try to govern a more united nation. Because I think most people realise that what we are trying to do is the right thing. We are trying in fact to get pay and output into balance. They know that that is right. We are trying to do the reasonable thing by looking after the weakest in our society. We have looked after the Health Service, we have looked after the pensioners. Their actually, their pension is up above, just exactly what inflation has been. I believe they know we are doing sound and true things and I believe that is why so many of them are with us.

Alastair Burnet, Thames TV

Thank you, Mrs Thatcher.

MT

Thank you.