As we are about half way through our first two Parliaments, it is right that we should take stock of the past and peer into the future.
I remember so well a visit from an overseas statesman some five years ago during our early months in office. “We are watching this country with great interest” he told me, “we are wondering whether you really can roll back the frontiers of socialism.” [end p1] His words lingered in my mind. I wondered why he doubted our will, when we had been elected for that very purpose. Perhaps his scepticism was not surprising. So many fashionable but debilitating nostrums pervaded our national life: — prices had to be controlled — pay ‘norms’ had to be fixed — subsidies had to be provided for every industrial ill [end p2] — don't de-nationalise—too difficult — don't reform trade union law—too troublesome — don't cut top taxes on earnings or savings—an envious society would rebel — don't sell council houses—it upsets the local administrators — inflation was good for industry—in strictly limited quantities of course — grammar schools and examinations were outmoded—because they involved tests of ability, [end p3] and when one evening I suggested to a banker that exchange controls should be abolished I was politely told that we couldn't possibly do that.
It seemed as if a whole generation feared to face the unknown responsibilities of economic freedom and enterprise. [end p4]
“Let sleeping dogs lie” , “Anything for a quiet life” —these were the sedative phrases which had hooked so many people.
And yet only four years on: — prices, incomes, dividends and exchange controls dismantled — inflation down to 5 per cent — overmanning and restrictive practices giving way to good management — the biggest de-nationalisation programme ever undertaken by any Government [end p5] — a million more home owners — overseas debt down — the nation's finances run with a sure and prudent touch — no deficit problem in Britain — nearly £1½ billion of goods and services exported every week
This was no mean achievement. We had pushed back the frontiers of socialism and advanced the boundaries of freedom.
Confidence in herself and in her industries had returned to Britain. [end p6] And in spite of a world recession our record in health and social services is better than that of any previous government. And don't let anyone tell you otherwise.
Tragically we have three million people out of work with all the frustration and despair that causes. But of this we can be sure: spendthrift policies, accelerating inflation, bureaucratic controls, monopoly industries, high personal tax, resistance to change and a cosy inertia would not have helped them. [end p7] Those policies would only have hindered the return to efficient and competitive industry and commerce. That's where real hope for the future lies. Those policies would have drained away the enterprise and energy needed for the creation of new wealth and new business.
Those policies would have compounded the very problem of unemployment we are striving to solve. [end p8]
I have consistently spoken the language of a free economy and of a wider distribution of property among our people. I do so not only because it brings greater prosperity and material wealth; but because it is in such a society that individuals have the best chance of fulfilling their aspirations and developing their infinitely varied talents and abilities. [end p9]
A few years before I entered Parliament, Lord Radcliffe gave the Reith Lectures on “The Problems of Power” , perhaps the most penetrating and brilliant in that distinguished series.
He concluded “It does very greatly matter that each individual should be both enabled and encouraged to make the best of all the good that is within him. It does very greatly matter that each individual should be free to form, hold and honour his own belief as to the meaning and value of human life … It does very greatly matter that any society should be so organised that these things are respected as its main purpose.” [end p10]
This is our Conservative belief and it applies to everyone of us. It does not matter who you are, who your family is, where you came from. It is what you are and what you can be that counts.
That is our vision. Those are our dreams. Impractical stuff? No. Some of the world's greatest builders were its greatest visionaries. Using the tools of their trade and the skills of their craft, and taking the world as they found it, they turned their dreams into realities. [end p11]
THE BUDGET AND JOBS
A few days ago, vision and skill of a high order were displayed by Nigel Lawson when he unveiled his first budget. It created a great sense of excitement. I felt it and I am sure you did too. What were the qualities that gave the Budget its remarkable impact?
It was a Budget which works with the grain of human nature, a Budget which gave protection to the poor and a spur to the strong, a Budget for enterprise and jobs—a true Tory Budget. [end p12]
It was a Budget that charted a course for a whole Parliament, laying out a radical programme of tax reform.
It set before the nation the choice: more public spending or lower taxation. Making the right choice is fundamental to the kind of society we seek. For in a world of high taxes there can be no true freedom, no hope of ownership, no individual fulfilment.
This Government, in this Budget, has chosen the road for lower taxes. I believe that is right. I believe that is what people want. [end p13]
The Budget finally swept away the pernicious National Insurance Surcharge which would otherwise be costing industry £3½ billion a year. It abolished, at last, the Investment Income Surcharge, the infamous penalty on savings. It totally reformed Corporation Tax, making it really worthwhile to go for profits. Not a bad hat-trick for a start.
And by the way, it took 850,000 people out of income tax altogether. [end p14]
Essential to it all is lower borrowing and lower inflation. Already there's been a welcome fall in interest rates and mortgage rates. The markets have given their verdict.
And our critics ask: “Is the Government running out of steam?” We're not. But they are. [end p15]
As Nigel has been the first to acknowledge, all this has been made possible by the solid foundation laid by Geoffrey Howe. For under his stewardship our economy acquired a new credibility and a new respect.
Three years ago, the pundits didn't think we could do it. They were forecasting inflation two or three times higher than it is. Just to take one example. One influential forecast, reported in July 1981 in the Financial Times, said that inflation would remain in double figures until 1985. It went into single figures in 1982, stayed there and is now at its lowest level since the 1960s. [end p16]
Or again, just after Geoffrey Howe 's 1981 Budget—a tough one which paved the way for today's economic recovery—the “Guardian ran the headline: “A Budget that will produce a hyper-slump such as Britain has not seen before.” Mr Chairman, output has increased steadily ever since.
Last month I visited a new science park in the West Midlands, at Warwick University. There, scientists and technologists are working side by side with industry to convert the latest scientific discoveries into new products and new jobs. [end p17]
In the last three weeks alone, there have been announcements of substantial new investments: by Sharp in Wales—630 new jobs; by Commodore in England—1,000 new jobs; and by National Semi-Conductor in Scotland—1,000 new jobs, bringing employment in electronics in Scotland to over 40,000. New jobs in new industries throughout the land.
We really must proclaim our success repeatedly to counter the reverse impression our political opponents constantly try to convey. As Mark Twain said, a false remark gets half way round the world before truth puts its boots on. [end p18]
Mr Chairman, the most worrying bill for many companies and households today is the local authority rate bill.
I know that many of you are conscientious councillors in Conservative Local Authorities, struggling to be economical and careful in spending the ratepayers' money.
However, the largest spenders are Labour Authorities, many of them spending with scant regard for the bills they inflict on ratepayers who have cried out for protection. [end p19]
And so this Government is re-asserting Parliament's ultimate responsibility for controlling the total burden of taxation on our citizens whether levied by central or local government.
To whom could these people look if not to us? Mr Chairman, they have not looked in vain. Our policies and the radical rate capping bill now before Parliament have already had a salutary effect. Towards the end of last year rate increases of 20 and 30 per cent were predicted, sums which could have been fatal for small businesses and which would have been a constant worry for many retired people living in large cities. [end p20] Yet again, the forecasts were wrong. Rate increases this coming year will average 6 per cent—yes, the lowest since 1974.
A few of our councils who have been thrifty for years feel that they have lost out because the high spending labour councils have taken too much of the grant. And they are right. “The rain it raineth on the just But also on the unjust fella, But more upon the just Because the unjust steals the just's umbrella.” [end p21] It's the sort of thing that gives “Singin' in the rain” a bad name.
Well, next year we shall have to try to take your problems into account and help you to hang on to that umbrella.
Mr Chairman, we shall carry out our pledge to abolish the GLC and the Metropolitan County Councils. They are too large, too costly and too remote.
When I was Secretary of State for Education, I was constantly urged to put the responsibility for education with the new Metropolitan Counties. [end p22] Knowing the extravagance of I.L.E.A. and believing that schools should be administered locally, I flatly refused. A decision for which I, and many ratepayers, have been profoundly thankful ever since.
Under this Government, and thanks to Keith Joseph, we have changed the debate on education away from perennial arguments on organisation to the important subjects of educational standards and greater parental influence. [end p23] Keith set out his proposals in a major speech early this year and it was wonderfully well received. It is a radical change which he is seeking and there are few tasks more vital. It cannot be produced like instant coffee. It will take time to percolate through.
But when it does, young people should be properly equipped to enter the world of work, confident in their basic skills and knowledge. [end p24]
But Mr Chairman, all our plans are as nought if people cannot go about their daily lives free from fear.
What value has rising prosperity if they are too frightened to leave their homes at night; or if a father dare not take his son on to the football terraces; or if people are intimidated on their way to work?
Safety and protection are as much part of the Conservative tradition as freedom and Enterprise. [end p25] Our programme for law and order is the most comprehensive ever undertaken. That is the proof of our commitment.
We have introduced stiffer penalties. There are more policemen on the beat than ever before, better trained and better equipped. More police time is being spent on serious crimes and less on paperwork.
But the police cannot do it alone. Every citizen has to help. No-one can opt out. If you want our country to be safe, you cannot afford not to get involved. [end p26] That is why the Neighbourhood Watch schemes are being introduced. And very successful they are.
Leon Brittan is totally dedicated to winning the war against crime. He is determined to push the crime figures down still further after last year's small, but encouraging, decline. He is out to see that the punishment fits the crime. To make up for years of neglect, he and Willie Whitelaw have launched the biggest prison building programme in our history. [end p27]
And I am also delighted that, in order to protect our children from the evils of pornography, the House of Commons has now passed Graham Bright 's Video Recordings Bill. There must be no place in Britain for the video nasty. When that Bill finally reaches the Statute Book, parents everywhere will applaud. [end p28]
Mr Chairman, I spent the first two days of this week at the European Council in Brussels—a meeting which ended in disagreement and disappointment.
It was the latest stage in our long campaign to do two things:- — first, to bring under control the Community's spending, especially its ever-increasing spending on huge surpluses of foodstuffs [end p29] — second, to get the burden of the budget fairly distributed between the member countries.
Two good Conservative principles—equity and sound finance.
We are not there yet. We shall keep on trying because we know it makes sense—sense for Britain and sense for the Community.
There will be another meeting next week—of Foreign Ministers this time. [end p30]
And Geoffrey Howe will go, as we always go to these meetings, wanting agreement, working hard for agreement, but determined to achieve our fundamental aims.
A few people ask—why not just settle? Why not pay more? Why not give up?
Well, giving up is something I am not very good at. I set my hand to this task five years ago. [end p31]
Yes, it does concern money. But it goes much deeper than that.
I have a vision of Europe which is a very long way from the Community of today.
I want a fair system of financing and disciplined expenditure precisely so that we can put behind us this endless haggling over money and begin to develop the Community's full potential. [end p32]
That is what our Party's commitment to the Community means. We want it to be: — a driving force for freer trade, both in Europe and across the world — the centre of tomorrow's industries and the very latest technologies — the home of creative endeavour and invention—qualities which were the very essence of Europe's past and which are waiting to be released in our peoples today. [end p33]
And that's only the beginning. This Continent is a vital area of stability and democracy. Imagine how different the world would look if Europe were under the heel of authoritarian governments; worse, if it were still wracked by the upheavals and wars of the past. All that must be behind us for ever.
The countries of Europe must co-operate, not just to preserve our own democracy and stability but to sustain and strengthen democracy across the world. [end p34]
All our history tells us that the world needs Europe, needs its accumulated experience and wisdom to make the world a safer and a better place. I want a Europe which takes the initiative on world problems, not which reacts wearily to them; which forges links across the European divide and builds a more hopeful relationship between East and West; which works in partnership with the United States, that great guarantor of Europe's liberty—works to defend and promote the values and beliefs which lie at the heart of Western civilisation. [end p35] No-one will be happier than I when we are all working for that kind of Europe.
And let no-one tell you that we in this country lack the credentials for that enterprise.
Who has done more for Europe than Britain?
Without us in 1939 and throughout those long and terrible years till 1945, Europe would have been lost—lost to the forces of evil. British men and women fought and died for a Europe free and at peace. Without them the European Community would not exist. [end p36]
No European country has done more than us to defend Europe since. Could there possibly be better evidence of our commitment to Europe than those 65,000 British soldiers and airmen stationed on the Central Front, or our role in guaranteeing Berlin, or our contribution to NATO's naval strength—the largest apart from the United States.
Our people have always looked beyond these islands. They saw seas and crossed them; found new lands and explored them; spread our institutions and laws, our knowledge and culture over the face of the earth. [end p37]
When we entered the Community we did so for more than a common agricultural policy. We went in with a vision. We still have that vision. And we shall not rest until it is realised. [end p38]
A Radical Government
Less than a year ago, this Government was re-elected with a historic majority. We achieved that vote of confidence despite a chorus of criticism and a clamour for U-turns at almost every step we took in the previous four years.
But when the vote was put to the people we won. Because we are a Government which puts people first; which stands up to the overmighty and powerful. [end p39]
On high-spending councils, Labour supports the town hall bosses. We stand up for the ratepayers.
On de-nationalisation, Labour defends state monopoly. We stand up for the customers.
On trade union reform, Labour sides with the trade union bosses. We stand up for the members. [end p40]
On council house sales, Labour loves to be the Landlord. We stand up for the tenants.
On taxes, Labour wants more of your money. We stand up for the taxpayers.
We want to get away from the cosy Whitehall consensus that Sir Humphrey knows what's good for the rest of us.
To turn the tide of a lifetime takes energy and determination. To turn the tide of a lifetime takes more than one Parliament. [end p41]
It calls for a radical government, with a powerful purpose and a clear idea of where it is going. The British people voted for just such a Government in 1979 and again last year.
Mr Chairman, they have it. As we began, so we shall continue, and with undiminished vigour.
For we are doing what the British people asked us to do: To change the course of history. [end p42]
We shall settle for nothing less. And it does very greatly matter that we succeed.