Colin MacKay, Scottish TV
[music]
Prime Minister, opinion polls say you've never been less popular since the general election than now and party managers want to change your image while protesting at the same time that that means there's absolutely no need to change Government policies. Now, that seems to indicate the party is all right, the policies are OK. It is just you that is wrong. Is that a gentle hint that it is time for you to go?
Prime Minister
Well, I think it would be rather odd if it were just me that was wrong but the policies are all right. I do have something to do, you know, with fashioning the policies and with putting them across. So if the policies are all right, there must be quite a lot that is all right.
Colin MacKay, Scottish TV
But what is wrong with you then?
Prime Minister
Look! I do not believe that you can do things—do politics—as a kind of public relations essay in images. We came to power knowing just exactly which way we wanted to go, with very clear [end p1] policies; not shading them; not saying we are practising followership, but saying: “This is what we believe we must do. This is what we are going to do. This is the direction in which we are going!”
The direction in which we are going is still the similar one because we believe it is the right way for Great Britain, and that is the way we shall continue; and if you say the policies are right, I can only say that I think that augurs very well for opinion polls in the months to come, especially as it comes up to a General Election.
Colin MacKay, Scottish TV
Well, I was actually saying that the party was saying the policies are all right … that you needed a few changes … but could I take you, as we are in Scotland, to an opinion poll in the “Daily Telegraph” yesterday, which said that nearly four out of five Scots are dissatisfied with you personally and of Scots who voted Tory last time but will not now, so they say, you were the third most important reason for their defection after unemployment and pensions. Why do you think you are so unpopular here, even amongst some of your own supporters?
Prime Minister
Third is quite a long way down the list you know. [end p2]
Colin MacKay, Scottish TV
But that is amongst Tories.
Prime Minister
It is not first and it is not second. Look! I think among our own supporters there is a very special reason why some of them feel resentful. It does not occur in England, because it is different. It occurs here because we have had two rating revaluations and what has happened is many of our supporters feel that they are having to pay far more than they should and they are not getting a fair deal, and it is quite right that their rates bills went up enormously. Yes, we did something to relieve it, because it really was quite scandalous. They could not be left like that, but it was not enough, and so they know that we have to change the law and we shall. But in the meantime, it does not help when the Government says: “Look! We have virtually conquered inflation!” They say: “Ah! But not our rates bill!” So there is a special reason in Scotland.
Whenever I go round, and as you know I go round quite frequently, I always ask about this, because I have been dealing with rates for quite a long time in my life and I know the resentment. And, of course, they home in on me.
Colin MacKay, Scottish TV
Could I look a little later with you, Prime Minister, at the whole issue of rates reform because it is crucial in the next [end p3] Parliament, but could I ask you: maybe there is a different reason. It is a lot longer-term isn't it, that in 1955—only thirty-one years ago—the Tories had more than half the seats and more than half the popular vote in Scotland. No other party has done that this century. What has gone wrong in these thirty years to put you where you are now?
Prime Minister
Well now, if you are saying that the policies are right and you agree that they are right—and I think an astonishing number of countries and people agree that they are right—then clearly we do have to try to explain them in much more direct and simple terms. I believe passionately they are right. That is why I am still here. That is why I shall go on.
But you see, I believe that in the end, it is the policies that matter. You so often ask me about image. You know, I am not the person to ask about my image. I do not know. You may know more than that. I just know that I do the things and we carry out the policies we do because we believe passionately that those are right for Great Britain and also right for the spirit of Scotland and I think policies are very important—more important in the long run than what you call “image” or “style” .
Colin MacKay, Scottish TV
Going back to that “Daily Telegraph” poll, Mrs. Thatcher, [end p4] over a quarter of your own voters—28%;—say that the Conservative Party can only really be trusted to look after Scotland's interests. That is the Party; it is not you. It clearly refers to the policies and the attitudes of the Party. What do you say to that?
Prime Minister
Did I get it right? Only the Conservative Party can clearly be trusted to look after Scotland's own interests. I thought that is what you said. I agree wholeheartedly!
Colin MacKay, Scottish TV
I am sorry. What I said was that over a quarter of your own voters said that the Tory Party can only rarely be trusted to look after Scotland's interests.
Prime Minister
Oh, rarely. I just do not believe it is right, and if they are thinking that, then we really must get over a few more facts and figures. Indeed, let me just give you one!
You have a house magazine called “Scottish Television” . It really is painting a marvellous picture of Scotland in the latest edition, August 1986. It is pointing out that Edinburgh, the financial capital, is the second most important financial centre [end p5] in Europe. It is pointing out that Glasgow, the commercial centre of the west side, in fact has now remoulded itself into a mixed economy. It is pointing out that, for example, wages in Scotland are well above British average wages, save for London and the South East, and that the Scots have a greater proportion of weekly earnings to spend on themselves than England. It is also saying something very relevant to what you said— “The Scottish nation” it says, “does not have the same problems as Tyneside, Merseyside and the broken industrial heartlands of the North.”
Now that is your sales director trying to sell advertising. He painted a very good picture of Scotland. Yes, and I agree, it is a good picture of Scotland. Of course, he wants to paint it well; he is trying to sell advertising on which jobs depend! Now do not try to run away from it! It is very good! And we have more problems in some of the English areas at present than you have in Scotland, and they will tell me that again when I return on Monday.
Colin MacKay, Scottish TV
I am not trying to run away from it. All I am trying to point out is that there are areas which you should be concerned about and which many believe that you are concerned about, but I would like you to explain them to them. While I agree there are bullish areas about Scotland, which we will come to, I would like to ask you about unemployment in Scotland. [end p6]
Against the background of all you have just said now, reading from that magazine, unemployment has doubled—more than doubled—in Scotland since you came to power in 1979. Now since the early 1980s, Chancellors have said: “There is a light at the end of the tunnel. Hang on folks, it is going to be better!” But it appears, at least the unemployed, to have got worse. What has gone wrong?
Prime Minister
First, as you know, England is not the only country, nor Scotland, nor Wales, nor indeed, the whole of Great Britain, which has suffered from much much higher unemployment. It has afflicted the whole of Europe, as we know, and it is one of the problems of the European Economic Community.
It has not afflicted the United States or Japan quite so badly, but it has afflicted the United Kingdom and the whole of the European Economic Community—even countries like Germany, highly efficient—even countries also like Germany and France and others, which also have compulsory conscription. They have high unemployment figures too.
Colin MacKay, Scottish TV
But not as high as ours. [end p7]
Prime Minister
First, they have compulsory conscription. I think if we took out a whole load of conscription for fifteen to eighteen months, that would have a very considerable effect.
Colin MacKay, Scottish TV
Are you suggesting that we should have compulsory conscription?
Prime Minister
No, I am not. Mind you, I think a lot of people would like it, but I do not think it is possible.
Colin MacKay, Scottish TV
Why not possible?
Prime Minister
It is not possible because we run a professional army and navy and air force and we should have to take a lot of people out of that profession.
Colin MacKay, Scottish TV
We also have a Territorial Army which we rely on heavily, quite apart from conscription. [end p8]
Prime Minister
We should have, in fact, to put up the numbers in the army, navy and air force enormously in order to train young people. We have not gone that way. We have gone for a professional army.
But let us get back! Yes, it is a European problem. We understand it and we have problems here, and there are other countries in Europe which have them even worse than we do.
You ask me why. Yes, there are a number of reasons.
First, new technology, as you know, is meaning we can manufacture more with fewer people; produce far more with fewer people. So the first effect of new technology is to reduce the number of jobs. Heaven knows, you see it in the media. You do not have to look any further than newspapers for that, as you see it in many other industries.
The second effect is to bring new jobs into existence and therefore, you have to wait for a short time for those new jobs to come. They are now coming. In Scotland, I think it is an extra 50,000 in the last three years. In the United Kingdom as a whole, it is an extra one million.
Let me make this clear! No government in a free society can guarantee jobs to every man and woman and young person. You can do it if you have total direction of labour, if you have a total Communist society, but we would not want that and we do not wish to have it.
In the meantime, we do try to mitigate the problem with some of the schemes we have. [end p9]
Colin MacKay, Scottish TV
Sorry. Could I deal with some of these very important points which you made?
First of all, as you said—and rightly—jobs do take time to work through, but 40%; of jobless in Scotland have been out of work for over a year and, as I said at the beginning, unemployment has more than doubled in the time that your Government has been in power, accepting the changes in unemployment patterns in the rest of Europe.
What do you say to a jobless man or woman who says to you: “I have been on my bike. I have been around. I have had fifty refusals in the last seven weeks or nine weeks. What do I do?” You are the Prime Minister. People do look to you as the Head of Government to try and offer a solution to them. They are prepared to take certain initiatives themselves. They find that they fail. What do you say to them?
Prime Minister
Well, of course they do, and we are taking certain initiatives.
You know one full well—every single person who has been unemployed for over a year is now being called in for personal interview to see whether there are any jobs that can be obtained for them or to see whether they need retraining, and so every single person is rightly going to have our attention and should expect to have it because we understand his problem. [end p10]
Secondly, there are massive retraining programmes to enable them to be retrained.
Third, we do a lot of community programmes, as you know, especially for people who have been unemployed for over a year, or young people unemployed for six months, so there are special jobs, I think it is about 350,000 now altogether, which we say to them: “Look! You cannot get a job on your own. Then please will you take one of these Community jobs? It gets you back into the habit of work and often it means that it puts you into contact with people who might be able to give you a job!”
The next thing is we do everything possible to encourage the development of small business and also regional policies to try to persuade people to come to invest in Scotland.
Colin MacKay, Scottish TV
But what happens to the man who has tried all that and recognises and welcomes the new moves, as you say, to get in contact with everyone unemployed and say: “Can we help in any way?” He says: “Look! I am long-term unemployed. I have been out of work in Scotland for over a year and therefore I am one of about 120,000 people in Scotland who are in that boat. Now what possible hope is there? I open the paper and I read of a new high-tech factory with an awful lot of money in it but employing twenty or fifty people and I say how can I possibly get a job as one of all that number of people out of work for over a year?” What [end p11] do you say to him?
Prime Minister
Just as I have indicated, that then you put him down for one of the Community Programme jobs, so that he does have a chance of working again and that is why we have increased the Community Programme jobs, just for the very reason you say.
There are some jobs which employers cannot get filled. Mostly, they are ones for which people are not sufficiently skilled, so it means that in spite of all the retraining we are doing, we are not sufficiently identifying the skill shortages.
I went to a computer centre the other day, certainly further down south. They were taking all kinds of people in for computer courses. It was not their qualifications. They did an aptitude test. Some were young people who had not had jobs, some were people who had come out of the army and not got a job; others were people who had become graduates and not got a job. It was not their qualifications—it was their aptitude. They were given up to six months training and they got 100%; placement.
You see, they had identified a gap in the market where employers wanted people and there were not people available. So yes, we shall do that.
Of course, as you know, again from your own article, the enormous number of extra jobs in services, for example, Edinburgh is a fantastic financial centre now and the financial sector [end p12] employs about 80,000 people. Of course, you know, there are a large number of hotels that have been successful here, very successful, and the numbers employed in tourism.
May I make one more point. Do not think that the unemployed market is absolutely rigid, if I might put it that way, that people have no hope. There are something like between 360,000 and 400,000 people who find a job every month. About that number come on to the register and about that number go off the register. It is not entirely without hope.
Colin MacKay, Scottish TV
But Prime Minister, you have raised an awful lot of points there. Could I take you back to one which I think is very important?
You have talked about a lot of new industries and obviously, there has to be change in industry and one of the big achievements as a great historian in the Tory Party, Lord Blake, says, is that you have lowered people's expectations of what Government can be expected to do for them. In other words, they must do a lot for themselves, and people are doing that.
But when it comes to the Britoil announcement yesterday, with the shedding of 750 jobs in Britoil—600 in Glasgow, 150 in Aberdeen—that is an industry which was held up to them a few years ago as one of the great new hopes—oil, new high technology we will export abroad—and suddenly, they begin to see recession [end p13] in an industry which has been held up by you and previous governments, to be fair, as a major new hope.
Prime Minister
Of course. It still is a major new hope. Of course it is. Aberdeen is the oil capital in Europe. Was and is, and it does employ a large number of people and will continue to employ a large number of people.
But I hope that you are not saying that a fall in the price of oil is damaging to every industry in Scotland because it most certainly is not.
Yes, it means that there is not so much exploration in the oil industry for the time being, but it does mean that people who had to pay heavily for their oil and fuel and raw materials which come from oil in Scottish industry now have greatly reduced costs. So, of course, do their competitors in Germany. So yes, the problem of one is the opportunity of another.
I cannot make them take advantage of that opportunity any more than I can compel people overseas to buy British or Scottish goods, but that opportunity is there to be taken advantage of.
Colin MacKay, Scottish TV
But in the North Sea, in the next eighteen months or so, there are various forecasts over the last eight weeks of job losses of between 10,000 and 17,500 because of the present [end p14] position in oil prices. Would you be prepared to alleviate that to some extent by lessening the tax demands on oil companies, which might allow them to explore more marginal fields despite the lower cost of oil?
Prime Minister
Well, I think that the tax varies according to the amount of profit they make, so there is already a variation in-built within it, and if that is not enough then obviously we have to look at it because we are very anxious that exploration should continue. Anxious for a number of reasons.
But the tenth licensing round, you know, was quite successful.
Of course, we look at these factors, as Nigel Lawson did some time ago, because we are anxious. Fortunately, oil is a much smaller part of our economy than it is of some other countries, but of course we are anxious, and of course, would not my task be wonderful if every single person had a job and the job they wished to have.
Colin MacKay, Scottish TV
Could I come back to traditional industries this time, Mrs. Thatcher, and ask you about Ravenscraig, the steel complex at Motherwell in Lanarkshire?
All the indicators suggest that it should close; that [end p15] commercial management decisions taken freely by people in the British Steel Corporation would be all 100%; for closing Ravenscraig. We know all about the steel recession in Europe; we know about the tremendous problems of the industry facing competition from outside; but there comes a point, does there not, where there is a political decision? Would you allow the British Steel Corporation to take that decision?
Prime Minister
You are asking me to make a political decision before it arises. I have made and continue to make it perfectly clear that the future of Ravenscraig would have to come before Cabinet. It would not be taken wholly by the British Steel Corporation, and I have said that and continued to make it clear because I know how important Ravenscraig is to Scotland and because I will never forget how staunchly it kept on working during the coal strike. These things are very important to me, but you are asking me for a categoric assurance before it occurs.
No, I cannot give categoric assurances, but I have indicated how important Ravenscraig is to me for what Ravenscraig did.
Colin MacKay, Scottish TV
But why wait? Because a lot of people at Ravenscraig who work there are puzzled that there is not replanting, which they would like to see happening, [end p16] which they claim is happening elsewhere in the British Steel Corporation and throughout Western Continental Europe, which means that in the period when the moratorium as it were at Ravenscraig comes to an end, Ravenscraig will stand, not denuded, but will be much less able to cope with that race for being a survivor.
Prime Minister
I do not think you are on quite the right point. I have indicated that there are five very big, very important, plants in steel. We know the significance and importance of each.
Yes, I am very much aware that other countries compete very effectively with those five. I am also very much aware of the importance of Ravenscraig to Scotland, to Scottish jobs. In a way, it is more than to Scottish jobs; it is to Scottish morale. I know that. There is a Scottish dimension as well as a steel dimension.
I will not forget what Ravenscraig did and the way it stood and the way it carried on during the coal-miners' strike, but please, Mr. MacKay, there is no point in asking me to take umpteen decisions now. I will take them when they come up on the basis of all the circumstances. It may never come up, because the whole of the industry may improve. One just does not know.
Colin MacKay, Scottish TV
But you just painted a very graphic picture of the [end p17] importance of Ravenscraig in Scotland and to Scottish morale. On that basis, clearly you think it is important. Why can you not make that commitment now?
Prime Minister
No, because it is not my job to make commitments on television interviews. It is not my job to say precisely what the Cabinet will do.
It is my job to go and discuss it with Cabinet, should the question arise—and I do not know whether it will arise—and may I remind you that a moment ago you were criticising me for my style. If I were to sit here and make umpteen decisions at your invitation, you might have grounds for your criticism.
Colin MacKay, Scottish TV
I do not think I was actually criticising your style, Prime Minister. I would not have the temerity to do so.
But could I ask you more broadly about traditional industries? Coal, shipbuilding and steel. Let us include that in the three.
What place do you see for them in Scotland in the future? Is it a major place?
Prime Minister
Shipbuilding: I think we will have to do more and more [end p18] specialist shipbuilding. Yarrows, as you know, is a very very good warship yard, extremely good, and running away with many of the contracts which are put up on merit—a very very good shipyard.
I think that Govan have just built a special ferry ship for P & O, and I think that it is on time and I think that they promised it would be on time, so that would augur well for the possibility of them getting more.
Shipbuilding has problem. Every country in the world who had shipbuilding has been subsidising it and we are no exception. Consequently, so many ships have been built because there were big subsidies that there are two years' supplies of ships just being laid up, swinging on the buoys, and apart from specialist ships, frankly, it is cheaper to go and buy one of those at way below cost rather than order a new one. So we have to get through that period and it is difficult.
Warships: Yarrows, Vickers, Swan Hunter and Vosper Thorneycroft. They compete very hotly for those contracts. Yarrows is very good.
On coal: gradually, the coal mines, as you know, are being judged upon whether they can produce coal at a commercial price. A lot of investment has been put into coal mines in Britain. I think one wishes, obviously—I have always wished for people who work in coal mines to have as good conditions as possible—and frankly I have never wanted them to work in those terribly [end p19] shallow, narrow seams. I have always wanted to close them. I do not think that they are places for people to work if they are thin seams, geologically split and cleaved, so I think we have to go and put everything we have got into the really good mines which can be profitable and there are, as you know, some in Scotland.
Steel, I have indicated Ravenscraig.
Coal, steel, shipbuilding. We also have, of course, oil and nuclear. Now where are you going from there?
Colin MacKay, Scottish TV
I would like to come back to the job pattern for a moment. Last year, employment was up by 6,000 over 1984 in Scotland according to official figures, at which everyone says: “Oh good, that is nice to know!” But, in fact, if you take it as a full-time equivalent all these jobs, because many of them were part-time, there was a reduction in the numbers of people employed in Scotland.
There is a tremendous move, particularly in the retail field, towards getting rid of full-time people and retaining the part-time people. The argument could be, of course, well, that is how industry works and that is how people become competitive, but is there not a danger that we are moving towards many more part-time jobs in our economy, which could take us back an awful long way to a period almost at the end of the last century when people felt uncertain and nervous and worried about their jobs because [end p20] they were part-time, because they did not have the sorts of strengths and securities of employment they would have had when they were full-time?
Prime Minister
The only security you get from employment if you are in business, and it is business that supports the public sector, is that of being able to satisfy the customer. There is no other way. There is no other way any government can give you security, any government. No way any employer can give you security unless continually you sell to and satisfy the customer both here and overseas. That is where your security lies.
Now, many industries do work part-time. What is wrong with working part-time? Many women like it. It suits the pattern of running the house. Often it suits the pattern of being home with the children for some part of the day and for years you know, certainly in the north of England—I am not quite sure in Scotland—they used to work what was called a married women's shift, so working part-time suits many many women very well indeed and it suits many people who are partially retired, and it is much much better for them to be doing something if they want to, so do not run down part-time. It also means that the family has a higher standard of living and therefore can spend on other things and perhaps bring into existence other jobs full-time. [end p21]
Colin MacKay, Scottish TV
Very briefly, I am not running it down, Prime Minister. I made the point, I think, I hope at the beginning, that the pattern of employment is changing. All I am saying is that with these part-time jobs many people themselves feel that it is the cowboys again. They are going to be people who will not need to insure; they are not going to have holidays; they are going to be able to be shoved out on the street on a Saturday afternoon once the shop closes. What do you say to that?
Prime Minister
I think you are so greatly exaggerating as just not to ring true to me. I just do.
You know full well that if a company is successful, makes good profits, it looks after its people, it has got the profits to look after its people. More and more employers are doing what we are urging and have profit-sharing schemes. People who work should also be owners. There should not be one lot of owners and one lot of workers. Workers should be owners. Earners should be owners.
I went to Vickers, which is a great big management buy-out—there are management buy-outs elsewhere—there are more people working now who are owning shares. Look, there is a new spirit of cooperation, but it is not a spirit of cooperation “we and they” . It is the spirit of cooperation of people who work and own shares. I believe in popular capitalism and I just do not [end p22] think that what you are saying rings true.
Yes, some people want part-time jobs. The security from a job will come from success in an industry. That will come from working together with management and work-force, and as you indicate, there are many enormously successful areas in Scotland. Yes, there are obviously some who cannot get a job and we bend all our efforts to that.
Colin MacKay, Scottish TV
Could I ask you why because why I am asking the question, Prime Minister, is that 900,000 workers in Scotland—that is about 46%; of the work-force—are low-paid if you look at the European Social Charter recommended minimum of £3 an hour.
Now, did that suggest that the free market is working properly if these people are low-paid?
Prime Minister
Look! The free market is this. When a housewife goes out with her housekeeping money or what she has earned, she is a very discriminating buyer. She buys well. As a consumer, she expects to get very good value for money and she will look at several things made by different manufacturers from different countries in the world and as a consumer she buys well. So does the person who takes out his wages or salary as a consumer. He looks at the cars and he does not say: “I am not going to buy that because [end p23] it is a foreign one!” He says: “Which is best value?” He buys well as a consumer.
As a producer, working in an industry, he must give and produce that same value as he expects when he is a consumer and that is the way to be successful, and many many Scottish businesses are successful that way.
Colin MacKay, Scottish TV
What I am saying is: if all these people are low-paid and if there are almost a million Scots who live at or below Supplementary Benefit level, then clearly the Scottish economy is not working properly is it, in your view. What is wrong with it?
Prime Minister
Well, the first thing you have to ask—and it is one of the problems—is what are the costs and are they being kept down and is the company being effectively managed, and you know full well that there have been many redundancies because they have found they could produce more with fewer people.
Now, sometimes, if you put up those wages with the same number of people you will have a higher-wage job and next month there will be no job because the price you can get for those goods will not bear the wages that necessarily are demanded and, yes, you have to choose then whether to stay in it with a job and to take what this Government introduced, because we do feel it is [end p24] much more important for a person to have the respectability and dignity of a job, to go home to the family and say: “Yes, my wages are keeping the family!” so you know we have topped it up with Family Income Supplement and that is going to be topped up now with a Family Credit Scheme because sometimes a person in work with children of course does not get anything like as much in respect of the children as he would if he were on Supplementary Benefit and we believe very strongly that it is far better to have those lower-paid jobs than not to have them at all and it is no earthly good having a great ideal that everyone has to have a certain amount from their job if the price of the product is such that the housewife will not buy it. She will buy from Korea or Hong Kong instead. So more and more, yes, we have to look at the price of the product and we have to look at the management and in some cases, as you know, it is leading to redundancy and then you say where do the jobs come from? They start from new business starting up like television.
Colin MacKay, Scottish TV
Absolutely. We could go through a whole raft of businesses which have started as others have left, but what I would like to ask you, Mrs. Thatcher, is where are we now? I am saying to you that there are 900,000 workers who are thought to be low-paid—there is almost a million people on Supplementary Benefit in [end p25] Scotland. Many of them watching this programme tonight might—unfairly in your view—say: “What does she know about it? What does she know of poverty? What does she know of what it means to live in the conditions that we are living in?”
I accept that poverty is relative, that as an economy becomes richer the poverty becomes less dramatic and less near the breadline, but what do you know of the problems that these people experience?
Prime Minister
But you can ask many newspaper owners, many television owners, many television commentators … are you to say that no-one must ever be in politics unless they have known what it is like to live in poverty? Of course you are not. Let me say that this Government, which for seven to eight years I have led, has steadily put up the standard of living of those people, steadily put it up, and it is higher for those who are Supplementary Benefit than it has ever been.
I would far rather they were not. Neither you nor I can just conjure up the jobs. They have to come largely from private enterprise.
There is one other problem which perhaps I should mention. Over a period of ten years, because of the birthrate boom in the late Sixties, we have a larger number of school-leavers every year than there are people retiring, so the population of working age [end p26] is much larger than it was in 1979. That I am afraid goes on for a period of ten years when it reverses and a larger number of people retire than are leaving school. That, of course, will be immensely helpful together with the creation of new jobs. In the meantime, we have to do as much training for young people—and I think we have just had the millionth person through the Youth Training Scheme—and the Community Programme.
Colin MacKay, Scottish TV
But you say you have raised the standard of living in this country. Could I put it to you again that the number of people on Supplementary Benefit or below the level has in fact doubled since 197. …
Prime Minister
Every time you raise the level of Supplementary Benefit, by definition, you bring more people in. Had we not raised that level, had we kept it down, then of course there would be fewer people technically living in poverty. We have not said that. We have said: “Yes, there is a problem.” Yet people in work, if you look at the average wages, have done really rather well and we have said … please let me finish, because you asked me about this … the average wages as you know are still going up faster than inflation. Those people in work have really done rather well at the expense of people being made redundant and therefore, yes, we [end p27] have said that people who have been made redundant should have a fair deal and they have from this Government in the nationalised industries and those who cannot get jobs should have a reasonable standard of living on Unemployment and Supplementary Benefit. That we have done. We have put up the amount of their savings which can be disregarded. We have put up the amount which they can earn without it being taken into account on Supplementary Benefit.
Do you not think that altogether that does amount to consideration for those people? I would have thought so. That is what it is intended for.
Colin MacKay, Scottish TV
Could I abandon that line then on poverty, Prime Minister, because you have brought up the question yourself of wages and people paying themselves too much and the impact on unit costs.
I think most people would recognise that unit costs in industry, the actual price of producing the goods with the people you have got and the plant you have got, is immensely important, but is it not true that high wages are now being paid in the private sector because there are skill shortages and that is the market force—that a firm says: “Joe Bloggs has the skills; there are not many like him. I am going to pay him!” and in fact pay quite willingly? That in fact it is not the workers themselves who necessarily are demanding and getting these prices [end p28] or wages that puts them out of a job—it is the firms that are prepared to pay because of skill shortages?
Prime Minister
I would think in many many cases that is not true. Where there is a highly-skilled skill shortages, for example in computers or some of the electronic engineers, I am not sure that that is a very large part of the unit wage cost. You have to consider what the wage bill is as a proportion of costs, but I do not think that, except in certain cases, for example where the Americans could offer some of our best research people enormous salaries, marvellous conditions and say go over there—and I always say: “Please stay here to help us to build up the kind of enterprise they have there!”
Yes, the private sector is paying quite considerable increased wages. I understand why. If you are doing well, you want to. What I am concerned at is are they paying increased wages this year at the cost of going out of business next, because they have to compete with Germany, Japan, and the trade unions there are not demanding anything like as much, and so we are saying to them: “Look, of course, if you do well in profits you have to provide not only for new investment—otherwise you do not exist—but also you want to do well by those who helped you, but please, can you not do it as profit-sharing so that you have to make certain that the profits are there and the success achieved before you do it!” We do not interfere with the private [end p29] sector. As you know, it is for them to manage their own business, but I do just beg those in management and those who are taking substantially increased wages unrelated to extra success to consider whether they are not working themselves out of a job. A high-paid job this year at the cost of none next year obviously would worry me no end.
Colin MacKay, Scottish TV
Prime Minister, I wonder if I could move on to another aspect which is of great importance. You touched on it yourself at the beginning of the interview, and that is the reform of the rating system, particularly the domestic rates, the community charge, the plan to replace the rates with this charge which would be levied flat rate in each council area on every adult.
There were reports this week that the Scottish Office had run into serious problems drafting this Bill. They have denied this, saying that it should get its Second Reading before Christmas.
First of all, is that Scottish Bill on target to pass into law this coming session?
Prime Minister
I believe it is. I was amazed to see that report, but there are many reports which I am amazed to see, and made enquiries and understand that they are right on target to [end p30] produce it fairly early after the Queen's Speech, so we can get it through this Parliamentary Session.
That is our firm intention. This is very serious. It is our firm intention. We have to get it through Parliament. Do not cut out first my Cabinet and then Parliament. I do not govern by decree. We govern through a parliamentary system. I believe it will go through. We shall do everything possible to ensure that it does and the Party knows that it is a pledge as far as we are concerned.
Colin MacKay, Scottish TV
But while the Scottish Office denies that there is a problem in presenting it possibly before Christmas, it is saying that there is a problem defining who lives where and therefore who goes on to the register and how the collection will be enforced. Now do you not admit that these are two very serious problems?
Prime Minister
Yes, of course. There is always a problem of how to enforce the payment of any tax, particularly for example, income tax. That too is a problem, but it does not mean that you do not levy income tax on each person and a community charge will be levied on each person.
Yes, there are problems. Mr. MacKay, there are enormous problems leaving the system as it is, including gross unfairness, [end p31] so it is not really a question of just saying: “Well because there are problems in a different course we must leave it as it is!” You have to choose between alternative courses and we think that the course we are going to is much fairer, much fairer, so we shall do everything we can to get it through.
You keep saying the Scottish Office denies it. I do not understand why you do not believe their denial. The Scottish Office says the Bill is on time and will be introduced fairly soon … .
Colin MacKay, Scottish TV
I did not say I did not believe them. I wanted to know what your reaction was to the two problems which they themselves admitted.
Prime Minister
Yes, of course there are problems and doubtless there will be new problems that come up during the course of legislation. That after all is why we have a Committee Stage and a Report Stage and they have to go through their Lordships' House.
Colin MacKay, Scottish TV
Mrs. Thatcher, the Tories have said they are going to be rid of rates for a long time now. They have been very consistent on this and to be absolutely fair, everyone in the United Kingdom [end p32] has been thinking about how can we get rid of the rates—there was the Committee Report in the 1970s looking at it and coming to no particular conclusion.
Is there not about this whole measure an air of panic, that there was the Party Conference last year in Perth when I heard from the gallery something we very rarely hear at a Tory Conference, hissing, and there was a gentle bit of booing, even of that amiable man George Younger as if he were some latter-day Sir Jasper as he attempted to appease people about the prospect of rating reform in the wake of that revaluation to which you referred?
Is it not just a panic measure?
Prime Minister
But if we have been thinking about it for a long time, it cannot be a panic measure. By definition, it must have been thought over and digested for a very long time. Indeed it has.
There are a number of possible courses of action. Because we could not agree on which particular course of action before the last election, we went for rate capping. Now, in many cases that has worked well. In Scotland, as I indicated, they have a special revaluation in law. That caused immense problems, but you cannot say we have been thinking about it for a long time and then it is panic. Very very far from that. [end p33]
Colin MacKay, Scottish TV
You could have changed the law.
Prime Minister
We are now going to change the law. First in Scotland, because it is more urgent there, and then in England. We believe now that we have got a much fairer system. Incidentally, there will of course be rebates from the Community Charge, as you know.
Colin MacKay, Scottish TV
But you will be wanting 20%; will you not, from everyone, whether or not they were previously fully rebated?
Prime Minister
That is right, but that also will apply to rates as well. As you know, that is going through now in legislation this year: that everyone should pay some rates and not go lower than 20%; That is on rates. It will of course go through to the Community Charge, so you get up to 80%; rebate.
Colin MacKay, Scottish TV
Thank you. Could I now move on to devolution, Prime Minister? Every other party in Scotland says: “Yes please, let us have devolution” and the polls show that 80%; of the people want an Assembly and maybe as many as a third—let us say a quarter to a third—would like independence in Scotland. [end p34]
Why do you still say “No” to devolution for Scotland along these lines of a legislative assembly?
Prime Minister
But as you know, there was a referendum and the Bill became an Act and went through both Houses of Parliament. There was a referendum and under the terms which had gone through by Parliament an insufficient number voted in that referendum for an Assembly, so it was a parliamentary process.
Colin MacKay, Scottish TV
Could I just take that for a moment, Prime Minister? That parliamentary process included, as you say, the referendum, in which the question was posed: Do you want this Act—the 1978 Scotland Act—to pass? And your Party said No, No, to the people of Scotland: do not let it pass.
Even more than that, Lord Home suggested that if people voted down the Scotland Act the Tories would come up with something even better, even stronger, was his clear implication.
Prime Minister
I think people talk about devolution without actually working out precisely what it means, precisely what it would forego, what you would gain and what you would lose. I do not think the term really has much meaning until you say: “What do [end p35] you want? What you will get and lose if you get that and is that what you really want and what effect would it have on other Scottish people everywhere?” And I believe that as it came up to that referendum people look much more closely at the consequences of what they have hitherto been in favour of.
But in any case, we went through that process and you know the result.
Colin MacKay, Scottish TV
But if people are saying, 80%; of them would like an Assembly, if clearly, they are so out of kilter with you and your party in the way that they vote and the number of MPs they return—it is quite different from England—and if someone like Brian Meake the former Convener of Lothian and the Tory Reform Group say simply that you cannot resist this demand for devolution, what do you say?
Prime Minister
I say that any demand for devolution has to go through Parliament, would have to be formulated. It is not a vague thing. It would be an enormous step as it was an enormous step when it was proposed before and as people got up to the details they looked much more carefully at it and many said No. Many many said No, and I believe they would say No again.
You say that I am out of kilter. You say that from one [end p36] opinion poll, but you know, we did quite well in Scotland in the last election and when it comes to the choices which have to be made at the next election, bearing in mind that many many people—I believe a majority—think the policies we are pursuing are right, I think that too will be one of the most determining factors and we shall do quite well again.
Colin MacKay, Scottish TV
Would you offer the people of Scotland the opportunity to vote again?
Prime Minister
I do not myself see the demand except for something called “devolution” which has not been worked out, and I am not satisfied yet that there is a fundamental demand for devolution.
Colin MacKay, Scottish TV
Sorry Prime Minister, but if 80%; say: “We want devolution!” and a substantial proportion are asked specifically “Do you want a legislative devolved Assembly?” After all, they did see how it was being built up in the 1970s as it went through Parliament, so they got a fairly good idea of what it would be like. If all these people appear to be saying that, then why do you not say to them: “All right! Let us give you another chance to decide!” ? [end p37]
Prime Minister
Because in fact we have recently decided that after enormous debate through both Houses of Parliament with very strange alliances formed across the floor of the House, people feeling very very strongly on both sides but not in a party direction. I believe that we have in fact thoroughly debated that for the time being and I do not see it coming up again in the very near future.
Colin MacKay, Scottish TV
But how can you square that with, as I say, the level in Scotland? You mentioned the vote, certainly it was 28%;, Labour's was 35%;. It was not all that different, but what matters to you because you do not believe in proportional representation is the seats on the green leather benches in the House of Commons, and that is twenty-one Tories in Scotland and forty-one Labour for example.
Prime Minister
But if you are going to break up the United Kingdom—which I think is what your proposal would lead to and which I am most against—and I think that many people fear that devolution would lead to the break-up of the United Kingdom and count each bit separately, then you come to the conclusion that the Conservative Party has a majority in England almost every time this century and the Labour Party would never have been in Government. Now you cannot break it up unless you are going to pursue a policy not of devolution, but of breaking up the United Kingdom, because the [end p38] longest journey starts with the first step. I hesitate before I even tread down that road. I do not believe that it would be in the interests of any part of the United Kingdom.
Colin MacKay, Scottish TV
Could I take you on, Prime Minister, to the next election. When will it be?
Prime Minister
I have no idea.
Colin MacKay, Scottish TV
Not the teeniest idea?
Prime Minister
Not the teeniest idea!
Colin MacKay, Scottish TV
What do you hope to put forward to the electorate at that time?
Prime Minister
A very effective policy, keeping all the gains we have made. Yes, we are very strong in defence, the world knows it. The world admires us for it. The world is prepared to order goods from our [end p39] export industries because of our strength in defence, the effectiveness of our equipment.
Yes, we are strong on law and order. We always support the police.
Yes, we are very strong on financial matters, in inflation, holding it down. There has never been a financial crisis under this Government, no matter what difficulties we have had.
Yes, the average standard of living of this entire country, including those who are on Supplementary Benefit, is in fact up—not of everyone individually, but the entire country as a whole is up, and so the creation of wealth has been going not as fast as we would wish, but it has been going ahead. May I please go on?
There is no other government in this country which has done as well with the Health Service as this one, not one.
Yes there is more to be done. Yes, of course, everyone wants the waiting list down, so do I. It has done well.
Yes, we have done well on pensions, bearing in mind there are nearly a million more pensioners.
Yes, we have gone steadily one. sic
Yes, I want more enterprise. Yes, I want improvements in the Health Service.
We have to look very carefully at standards in education because a lot of people are not satisfied with it. [end p40]
Colin MacKay, Scottish TV
Mrs. Thatcher, that does look awfully like a sort of consolidated “Let us see what we have done over the last two terms. Steady the bus! We are not going to do an awful lot more!”
Prime Minister
No, it certainly does not.
First, to be strong in defence you have to continue your policies. We shall.
To be strong in law and order, you have to continue your policies.
Financial prudence does not just come. You have to carry on and on.
Enterprise does not just come. You have to pursue policies for enterprise.
Yes, and I do believe that what you pay in tax gives you incentives, because look! Yes, we do wish to reduce the amount of direct tax. Our bottom rate at the moment, twenty-nine pence in the pound, is going to be above the Americans' top rate. That means we might lose good people.
Yes, there will be a very forceful, effective, bold policy at the next election.
Colin MacKay, Scottish TV
Mrs. Thatcher, could I move on for a moment? Tonight, [end p41] after this interview, you will go on to other engagements. I do not know what time you will get to bed tonight or tomorrow morning. You will have red boxes, you will be reading state papers. Are there ever occasions when you and your husband Denis look at each other and say: “Is it really worth it, all this?”
Prime Minister
Oh, but it is worth it! I believe passionately in the future of the United Kingdom. That is England, Wales, Northern Ireland and Scotland. I put Scotland because we are here. I believe passionately in it. I do not believe in trying to give people a false impression there are easy options. We did not become a great nation by taking easy options, but by using our talents and demonstrating them to the rest of the world, and they are very very big talents. The British character and the Scottish enterprise and sturdiness in defence. We have to live up to the best in us.
Yes, you do need someone at the top who is a real fighter and someone who keeps a steady nerve and someone who is not prepared to lower the objective, but is prepared to go on raising the sights. That is why.
Colin MacKay, Scottish TV
But is there no-one else that you could hand that over to and have a rest now? [end p42]
Prime Minister
I am sure there will be other people who will come forward and who can carry on the torch, but right now I think that I should continue it into a third term.
I do not mind hard work. I do not mind how exhausted one gets. I do not mind some of the things that are said. I do not mind the stormy occasions we have every Tuesday and Thursday. What I do mind is that Britain begins to live up to the future which I wish to see for her.
Colin MacKay, Scottish TV
Prime Minister, thank you very much indeed.