Judith Dawson, IRN
Today was the occasion of the Silver Jubilee for Neddy [NEDC], is there any reason after this morning's meeting for celebration for all of you?
PM
Yes I think there is, it was a very friendly … You see, what with the outcomes, we all face the reality, that just as when Neddy [NEDC] began they said that the essence of growth is to have industry and commerce as competitive, so it is now. I think one of the most significant things is that when we were talking about pay, we did not just talk about pay alone, pay always has to be related to something; to output, to productivity, to performance and we all realise that, and Terry Beckett pointed that right out in the beginning that unit wage costs were not going up anything like as fast as they used to be which is good because it means we are more able to compete with people like Germany and France.
Judith Dawson, IRN
Did you relate pay also to unemployment?
PM
There always is some relation between pay and unemployment. [end p1] You put it very simply. Supposing an employer has a £1000 a week to pay in wages and you have five people and on average they have £200 a week, if they all say no, we want £250 you can only employ four instead of five so there is a relationship but it is not a simple one.
Judith Dawson, IRN
Did you discuss at all during the Neddy [NEDC] meeting, the suggestion that some of your Ministers have put forward that there should perhaps be regional pay differences for the same job?
PM
No, we did not get into that kind of detail, we did point out that as distinct from talking about generalities, when you are dealing in a factory or in a shop or office, if you have not got the right manager, if you have not got the right scientist, the right engineer, you have got to pay him, otherwise you have got to pay to get what you want, otherwise the whole thing would collapse, so you do need flexibility on the ground.
Judith Dawson, IRN
Do you think, though, that there is any evidence that if you are paying people less in areas of high unemployment that unemployment will come down.
PM
I do not think you can be as general about it as that; in areas of high unemployment you will at the same time probably have a number of companies that are flourishing quite well. This happens [end p2] all over the north and the north-west; you have got very, very flourishing companies and I think if you try to look every thing on a sort of broad brush you will not get the right answer.
Judith Dawson, IRN
What do you think are the positive things that came out of this morning's meeting?
PM
The positive things were there is a lot of good news that we are growing steadily, that there is a lot of good news for companies; that they are making good profits which means that they have got more to invest back into industry. They are very much aware that when you are talking about prosperity and flourishing business, it is not only pay, you have got to get the design right, you have got to get the quality right, you have got to get the delivery right and may I say that in summing up one put it this way: when each of us goes down to spend our wages or salaries, we buy very carefully; we expect value for money, we expect good quality and we buy the things that are most competitive. If that is what we expect as consumers, that is what we have got to produce as producers. So the same sort of yardstick that we apply to spending our money is the same criteria we must apply to ourselves when we produce the goods that we want others to buy.
Judith Dawson, IRN
Were the trade unions keen to talk to you about the proposals the Government put forward last week to further curb their power? [end p3]
PM
No, it was not mentioned.
Judith Dawson, IRN
So what was the main contribution made by the trade unions?
PM
Well, they joined in everything. Of course it matters as much to trade unions that you have flourishing competitive industries. It matters to us all. That was the point; we were not this side against that; right at the beginning I said “Look, we are all on the same side in wanting flourishing industry and flourishing commerce” .
Judith Dawson, IRN
Hasn't that been unusual, finally, for this Government for there to be consensus between the Government, the trade unions and the employers?
PM
Well there should be consensus about reality because you cannot run away from what makes a company successful and there was, and it was very good, very friendly, very constructive and Terry Beckett said right at the beginning—and of course it was his last meeting— “let us accentuate the positive” and we did.