Jonathan Dimbleby (Thames TV)
Prime Minister, at the start of your campaign you said you wanted to go on and on and on. Is that because you think that in order to achieve your goals as your campaign slogan suggests that you need another ten years?
MT
I hope the Conservative Party will go on and on and on in government—obviously—because I believe in what we're doing. For me I have to tackle this campaign and I hope with a team to win it. But you know I was under quite heavy questioning at the time and the object of the questioning was to try to discover whether some time in mid-term I might give up and so of course I said …
Jonathan Dimbleby (Thames TV)
[Dimbleby speaking over MT]Did you …
MT
… so of course I said I really would like to go on.
Jonathan Dimbleby (Thames TV)
Do you share, Prime Minister, Lord Young's assessment that unemployment will continue to fall at between 20 to 25,000 a month?
MT
We expect it to continue to fall at about the same rate as it is now. But, of course, one never knows about things like a world recession. One never knows whether you're going to get some protectionism put on by one country. One never knows quite what may happen which might affect oil prices. And so everything is subject to that. But we do hope and expect and believe that it will continue to fall.
Jonathan Dimbleby (Thames TV)
He said you could work out where that might get you. He was referring to the Alliance's claim that they would reduce the unemployment figures by a million over three years. And indeed if it were to get you there, at your rate, it would be 900,000 in three years. Is that what you're expecting?
MT
Well, I think one has to keep one thing absolutely clear. You can create quite a lot of extra jobs but it doesn't always reduce the unemployment register by that much. First, because the population of working age is going up, and secondly, because quite a lot of the extra jobs are taken by married women. And therefore it is very different unwise to predict the precise unemployment register.
Jonathan Dimbleby (Thames TV)
[end p1]But why don't you forecast generally? Other economic indicators are forecast—inflation, trade, and so on.
MT
Er, inflation we have a very much more better idea of for about two months or three months in advance. Trade is a little bit uncertain, as you know. The Chancellor actually forecast for this year a deficit for this year of £2.2 billion. Actually the first four months we have had a surplus, which is a very very good thing. But I think if you look at employment for a moment you can see why. Most of the jobs are created by business. Jobs come from successful business. You don't quite know what the course of many many businesses will be. You Do know that if we get growth the likelihood is that unemployment will fall. We have had growth for a number of years and unemployment is at last beginning to fall and expected to go on falling. But there are so many uncertainties that I would not like to put a precise figure on it.
Jonathan Dimbleby (Thames TV)
Should one discount, should the voter discount, those independent economic institutions that have said that on present policies, they forecast that by the end of the next term—with your policies—unemployment would stall hover around three million?
MT
I have seen so many forecasts during my life. And things happen which falsify them and I would not like to say that. Indeed I wouldn't say that, because I think perhaps they're not taking into account that early in 1990s there is one fundamental factor which is different. As you know in the last ten years we have had far more school-leavers than we've had people retiring. That's just the way the birthrate went, many many years ago. So year after year after year we've had more school-leavers which means that we've got about a million more people in the population of working age. That position reverses early in 1990s. Far fewer school-leavers, far many more people retiring. Now that undoubtedly will be quite a big factor. But you've got to reckon … they'll have to be trained those school-leavers, because there are far many more jobs for trained people now and far fewer jobs for comparatively unskilled people.
Jonathan Dimbleby (Thames TV)
If the unemployment figures were still around three million or so by the end of the next term and you were Prime Minister, would you think it fair that it should be applied to you what you applied to James Callaghan when he was Prime Minister and the unemployment figures were only 1.5 million, that he would go down in history as the Prime Minister of unemployment?
MT
I think a great deal depends to what happens to the world economy, and as you know we're having the Venice Economic Summit. We're doing our level best not to get protectionism, and we're one of the countries that does more protectionism [sic]. It means we sometimes keep our borders open to trade when others don't. A great deal depends upon that. But I think if we get steady growth of the kind we're getting we shall in fact get unemployment falling. How far new technology will reduce the number of jobs and how far it will mean we can produce things we've never produced before, is difficult to judge. [end p2]
Jonathan Dimbleby (Thames TV)
In the present circumstances, do you think that those two million or so pensioners who rely on the basic state pension have enough to live a decent life?
MT
But they don't have to rely on the basic state pension.
Jonathan Dimbleby (Thames TV)
With supplementary ? help as well.
MT
That's precisely why we have the supplementary pensions because everyone in effect now has two pensions: they either have the basic plus the occupational, or a state …
Jonathan Dimbleby (Thames TV)
[speaking over MT] Enough to live a decent life …
MT
… and they, those who haven't had the basic plus supplementary benefit plus housing benefit plus rate rebates usually. Um, obviously one would always like to give more and one tries to give just a hint more to those who are older, because they have gone on longer. But we guarantee—inflation proof—the pension, the basic pension for the old folk, and the related benefits, and one of the related benefits is supplementary benefit so that also is guaranteed, it's inflation proofed.
Jonathan Dimbleby (Thames TV)
When it was known that I was going to be interviewing here lots of letters came in here, many of them from pensioners. One of them, if I can quote it to you, says this: “I am 76” —one of your older pensioners— “and I should be glad if you would ask Mrs Thatcher what advice she could give me in order to spend the extra 15p she awarded me in the budget, to my best advantage” . What is your advice to her?
MT
[MT looks puzzled] The 15p awarded in the budget?
Jonathan Dimbleby (Thames TV)
I think she was probably referring to the April uprating in practice which in fact, yes, I think 11p …
MT
Well, now look. What we have done, as you know, to say to the pensioners, “we will inflation proof your basic pension” . Now what happens when inflation is low—4 per cent—obviously it's inflation proofed to the extent of 4 per cent. But you know 4 per cent means that the pension does not lose its value very quickly. Now, in days during the Labour Party, when it was in government, it got right up to 27 per cent. So yes they got a 27 per cent increase—well, not always, because Barbara Castle changed the basis of calculation—but then it lost its value VERY very quickly. Now some of them [end p3] still think of the increase in actual money terms rather than relating it to the rate of inflation.
Jonathan Dimbleby (Thames TV)
So is your advice to her, which it seems to be, rejoice and be merry?
MT
No. I don't think you're quite being fair, Mr Dimbleby. I did not say that. I said what we have done is to guarantee that we would inflation proof the basic pension and we've been able to do that not only with the number of pensioners that were there when we started but with one million more pensioners. And it is not guaranteed so much by government. It is the ordinary working population because the money paid out in pensions this year is the money paid in in national insurance contributions by the working population. And if they only have the basic pension, then they will get a supplementary benefit—also inflation proofed. They also will get housing benefit, which meets their rent. They will also get rate rebate. And also, may I point out that when …
Jonathan Dimbleby (Thames TV)
[speaking over MT] Would you say … poverty …
MT
Please, there's just one other thing. When we get bad weather, the Labour Party only gave £90 million pounds a year on heating allowances. With us it's up over £400 million. And that too is important. And we've been able to do these things because under Conservative Government we've had strong growth and a strong economy. Without that we wouldn't be able to do them. Of course, one would like to do more. But fortunately now most people are retiring two pensions, the basic and the occupational pension, a large number have pensions—71 per cent of per cent of pensioners who retire have savings—and half of them have their own homes and of course more and more will have shares.
Jonathan Dimbleby (Thames TV)
For those who don't, what do you think it says about our society that when you get the weather going down to zero or so, we have to suddenly find fivers to avert the risk that some old age pensioners don't die of hypothermia? What does that say about our society—not comparisons with what Labour did or didn't do, but just what it says about us now?
MT
Well, it's a great deal more than a fiver because you haven't taken into account the amount that's in supplementary benefit …
Jonathan Dimbleby (Thames TV)
[talking over MT] The extra amount they have I'm talking about.
MT
… for severe weather payments. What does it say about our society? It says that they are willing to find the money and make it available. You know there used to be these [end p4] payments. In Harold Macmillan 's time there was no such thing. No such thing at all. In Harold Macmillan 's time there was no such thing as housing ben either.
Jonathan Dimbleby (Thames TV)
Can we move on to tax. You have been very clear in stating that you want the tax rate—the basic rate—to go down to 25p and maybe lower if growth will allow it? Can you be more specific about what you have in mind for VAT? I know that you have ruled out VAT on food. Do you rule out VAT on, for instance, children's clothes, books, newspapers? Fuel, fares?
MT
Look, if anyone tried to put Value Added Tax on children's clothes and shoes they would never never never get it through the House. Er …
Jonathan Dimbleby (Thames TV)
[speaking over MT] So that's out.
MT
…Tony Barber—I remember very vividly the debates—Tony Barber in fact eliminated it on those things. Now I have said that—we get this every single election—I have said, “no, it's zero rate on food and also on gas and electricity” . The other thing just would never go through that you particularly mentioned. Now I not going to go any further than that, Mr Dimbleby, for a very good reason. Yes, people like you will try to go on and on, and the moment we say one thing, you'll find another and then another … one moment …
Jonathan Dimbleby (Thames TV)
Well viewers might be interested Prime Minister …
MT
… hold on, and then another. But you see a Chancellor of the Exchequer has to govern according to the circumstances. And no RESPONSIBLE minister would constrain him. No responsible minister …
Jonathan Dimbleby (Thames TV)
[speaking over MT] Why don't you make clear about books and magazines. Does that mean that they are …
MT
No you going to trap … No, you're going … . Yes, that's exactly a typical question.
Jonathan Dimbleby (Thames TV)
I'm sorry.
MT
Yes, But …
Jonathan Dimbleby (Thames TV)
But people might be interested Prime Minister. [end p5]
MT
Well, let me say to people. I have undertaken not to do it on food—that was in right from the beginning—and on gas and electricity. No, we haven't got any particular plans to do it on other things, but I'm not going to constrain a Chancellor of the Exchequer. I don't know what the circumstances will be of any particular budget. I know that when he comes and looks at it at the time he's got to look at income tax, value added tax, customs and excise, national insurance contributions, and he's got to look right across the field.
Jonathan Dimbleby (Thames TV)
But if you don't rule things out, aren't some people going to say Prime Minister: “Ah! That's their hidden manifesto.”
MT
Yes, they are. But then I'm going to say to them, look at our record. Look at our record. Look at our expenditure record. We have spent extra money when we've had the growth to do so. And if you are in fact talking about VAT or income tax please look at the Labour Party. You simply cannot … No, don't stop me.
Jonathan Dimbleby (Thames TV)
I didn't stop you Prime Minister [laughing]
MT
You simply cannot say you are going to spend £35 billion—and it seems to be added to every day—without putting a COLOSSAL amount on VAT, a colossal amount on income tax. Let me stand on our record. We have run the affairs of this country, the financial affairs, SOUNDLY. We haven't over-borrowed. When we spent more than we thought, actually, we wanted to spend but nevertheless we had to spend it, we financed it soundly. Sometimes by higher income tax that we would wish, sometimes by putting up other taxes higher than we wish, but it's financed soundly and every one knows now there will be no financial crisis under a Conservative Government. That's something worth knowing.
Jonathan Dimbleby (Thames TV)
Your manifesto points out that someone on average income is now paying something like £500 a week less in tax.
MT
£500 a year less in tax.
Jonathan Dimbleby (Thames TV)
I beg your pardon, £500 a year.
MT
£10 a week less in tax.
Jonathan Dimbleby (Thames TV)
[end p6]What it doesn't point out is that that same person is paying like £250 a year more in national insurance contributions and £250 more in indirect taxes, principally VAT. Relatively speaking therefore someone on average earnings is actually paying back just about the same proportion of their …
MT
[MT interrupts] Look …
Jonathan Dimbleby (Thames TV)
… earnings in 1979.
MT
His take-home pay is considerably up. Considerably up.
Jonathan Dimbleby (Thames TV)
In 1979 Prime Minister you said that you thought that amount that the state took …
MT
[tries to interrupt] Yes …
Jonathan Dimbleby (Thames TV)
… was too high. But it's the same, isn't it, for a man on average earnings.
MT
His take-home pay is considerably up. Yes, his national insurance contributions have gone up. And you simply cannot ask me why we do not increase the basic pension—particularly for the older folk—but you must cut down your national insurance contributions. Mr Dimbleby, it doesn't make sense. What goes out this year in pensions comes in this year in national insurance contributions. It is the tax-payer, or—to be more accurate, the person that pays in national insurance contributions—that provides the pension this year. You are now castigating me for two opposite things. Firstly for not …
Jonathan Dimbleby (Thames TV)
I, I …
MT
Firstly, for not trying to provide more for the pensioner, and we do inflation proof it and try to provide as much as we can, and at the same time castigating me then for actually made that provision possible from the working population. Yes, every time I face the Opposition Tuesday and Thursday on questions and I see more expenditure, more more more, as if it were just confetti money, I do say—look, you don't pay it. Nor does Government, except as citizens. All of this has to come out of the population of working age, either in their tax for supplementary benefit and housing benefit, or in their national insurance contributions for pensions and sickness, invalidity benefit, unemployment benefit and so on.
Jonathan Dimbleby (Thames TV)
[end p7]Can I move on. This morning you explained why, at a press conference, we you don't use the National Health Service, and you explained—and I'm sure as many people would understand that as Prime Minister you have to be able to get into hospital when you can, because you've got other duties, as you might say. But you also went on to say—and this is what I want to ask you about—I exercised my right as a free citizen to spend my own money in my own way. Now without saying anything about that right, which of course you have, do you acknowledge that the great majority of your fellow citizens do not have the freedom to exercise that right, because they don't have the money to do it?
MT
I do exercise the right to choose how I spend my money. Some would spend it on alcohol, some would spend it on cigarettes, some would spend it on gambling, some would spend it on many many other things. …
Jonathan Dimbleby (Thames TV)
[interrupts]But the viewer at home …
MT
[interrupts] One moment.
Jonathan Dimbleby (Thames TV)
… who knows they can't afford it is going to say “Prime Minister, I'm not wasting my money on gambling and cigarettes, I simply can't afford the private health” .
MT
Mr Dimbleby, I think what you are saying is that if everyone can't have it, no one shall have it. If you take that view, there'll be no progress at all. Let me give you an example. When we came back into office, a long time ago now, in 1951, only 30 per cent of people owned their own homes. Had we adopted your argument, Mr Dimbley, “well if so, if everyone can't have it no one should have it” —that's the socialist, it's the communist argument: “If everyone can't have it, no one shall have it. And therefore let's take it away, let's make them all council tenants” . No we didn't. We did a real Tory thing. We said let's try to bring to more and more people what only a few have now. And so now there's 65 per cent in England who own their own homes. Now the average earnings are going up, the standard of living of the people is going up …
Jonathan Dimbleby (Thames TV)
[successfully interrupts] So you expect the proportion in the National Health Service to shift across to the private section in the same way?
MT
… As a matter of fact the number of people who are CHOOSING to insure—and they choose. And if they don't want to, we're all paying our dues to the National Health Service. The average family of four in this country pays to the National Health Service, every week, in the several taxes, £27. £27. And if they choose … . Having paid that in their taxes, if they choose to spend their money in a way which gives them private insurance or private housing or better clothes or a better car, Mr Dimbleby, fortunately [end p8] we have a free society, and our view is to enlarge the choice of people, and not to reduce it.
Jonathan Dimbleby (Thames TV)
You said, if they want to spend more for better this, better that, better so and so …
MT
Different.
Jonathan Dimbleby (Thames TV)
Well, you were saying better, but I accept that of course.
MT
Well, different, a private house is different from a council house.
Jonathan Dimbleby (Thames TV)
If I can relate that to the National Health Service, if I may, if the National Health Service is only safe in your hands, wouldn't it be a good idea to demonstrate that, and the way of demonstrating that might be to use it, some people would say?
MT
Don't you think that you have got at me, very much, had I said “look, if I got to be in a certain day and I've got to be out on a certain day” . You'd have accused me of queue jumping. And you'd have been the first to have done so.
Jonathan Dimbleby (Thames TV)
Certainly not.
MT
And if you're getting five million people doing that, as well, don't you think you're going to put an extra burden, don't you think that you're going to make the waiting lists longer? And that even so, Mr Dimbleby, that the day that I walked into Downing Street, the economy was such that the taxpayer could only afford to pay £8 billion a year to the National Health Service. After eight years of Tory Government, the economy is such that the taxpayer can now afford to pay £21 billion to the Health Service. Now from £8 to £21 billion is an ENORMOUS increase. It's come about because we've run the economy successfully. It's come about because people have a higher standard of living. If some of them choose—and five million do, and some trade unions negotiate it with employers—to spend their money in that way …
Jonathan Dimbleby (Thames TV)
[tries to interrupt] Do you …
MT
… Thank goodness, they are still free to do so.
Jonathan Dimbleby (Thames TV)
Do you think it is—er—any comfort to those three quarters of a million who are on hospital waiting lists to know that this money has been spent. What comfort can that [end p9] be to them when they look forward to the prospect of months and maybe years of waiting for operations, worried, anxious and even in pain?
MT
Three quarters of a million people on waiting lists. There were 70,000 people on waiting lists in 1979 than there are now.
Jonathan Dimbleby (Thames TV)
Is that a comfort to those that are on it now?
MT
I am sure it isn't. I'm sure it isn't, because if I wanted a hip operation or a cataract, of course … But over and above what happened in 1979, there is a great deal more spent, as I indicated, from £7 nearly £8 billion to £21. There are more doctors. There are more nurses. Equally, Mr Dimbleby, there are a lot more treatments. There are a lot more operations available to everyone. You get a new treatment, you get a new waiting list. When Alec Merrison did an investigation into the Health Service—a Commission on the Health Service—he said “we have no difficulty in believing that the whole national income could be spent on the Health Service” . Well, of course it can't. No, let me stand up for my own Government. This Government has spent FAR more, the taxpayer has spent far more, because the economy is strong. More doctors, more nurses. We've just allocated another £50 million to try to get those waiting lists down. I most earnestly hope they will come down. But believe you me, it wouldn't help them to come down if five million people said, we're going to give up insurance and all come on to the National Health Service.
Jonathan Dimbleby (Thames TV)
Ah. I would like to …
MT
[speaking over Dimbleby] It would be the very reverse. Yes.
Jonathan Dimbleby (Thames TV)
… ask you lots more on that topic, but I want to move on to education for which you've made many radical proposals. Let me ask you generally first, how long do you think it will be before the state sector is good enough so that more of your colleagues, your Cabinet Ministers, will take the choice to educate their off-spring in the state system, rather than to exercise their choice to educate them outside that system?
MT
In many cases it is. I revisited my own old school. The education that they are having is absolutely marvellous, even better than we had because frankly the facilities are better, the laboratories are better, the domestic sciences are better, the art is better, the mathematics, the physics, everything. It is fantastic.
Jonathan Dimbleby (Thames TV)
Why then don't more of your colleagues send … exercise their right to … [end p10]
MT
But quite a number do.
Jonathan Dimbleby (Thames TV)
Cabinet Ministers sending their children to secondary schools …
MT
[speaking at same time]
Quite a number do.
Jonathan Dimbleby (Thames TV)
… in the state system?
MT
Quite a number do. Quite a number do. And some of them are very fortunate in that they live in areas where there are very good state schools because as you know, the kind of school you get and the standard you get over varies very much from one part of the country to another, and there are many many—er—EXCELLENT schools. I would say the majority of schools in the state sector are very good. In inner cities some of them are very very far from that. Now, people pay, again in taxation and rates, for the education that they are getting. In some inner cities it is take it or leave it and some of the parents don't want that kind of education and they are trapped. And that is why we said, “right, we will try to release you from those local authorities, so you can have exactly the same money from ratepayer and taxpayer as they would get there and set up a trust and you can run a different kind of school, run directly under the Department of Education and Science” . It is an extra choice. It is so that people … Do you know, some people make FANTASTIC sacrifices to try to get their children out of some of those schools. Frankly I agree with them. They ought not to have to. The amount they pay in rate and taxes they should be able to have more choice they have at the moment.
Jonathan Dimbleby (Thames TV)
Would you like to be able to see a situation that those schools that opt out, the comprehensive schools, that over a period of time, given your great enthusiasm for the grammar school system, that a great number of those comprehs decide to take up the grammar school option. Is that what you if you were a parent would be urging?
MT
That's not the only way you can get a grammar school. You can get a local education authority putting up a proposal for a grammar school.
Jonathan Dimbleby (Thames TV)
Would you like to see more generally then perhaps?
MT
I think in inner cities I think the grammar school was the ladder from the bottom, however far one wished to climb, for many a young person that would never have it. There were some very very famous grammar schools, that really were direct grants. Manchester … [end p11]
Jonathan Dimbleby (Thames TV)
Would you like to see more?
MT
I personally would like to see me, because if you look at House of Commons many of us who got there, got there through a grammar school system.
Jonathan Dimbleby (Thames TV)
Prime Minister, I must move on again to defence, if I may … .
MT
[interrupts]Do you remember Harold Wilson? Perhaps you don't, you're too young …
Jonathan Dimbleby (Thames TV)
Can we … can we …
MT
Do you remember Harold Wilson saying grammar schools will be abolished over his dead body?
Jonathan Dimbleby (Thames TV)
I DO remember that but I don't think we have time to pursue that now.
MT
What a pity. That was the view of many Labour people in those days.
Jonathan Dimbleby (Thames TV)
Can I move on … on to defence. You've made it very clear that you believe that a small country like ours can protect itself against nuclear blackmail is by the possession of the nuclear weapon as the ultimate deterrent. Would you therefore regard it as a right of other small countries, who regard themselves as in that same predicament, to exercise that same right, to acquire nuclear weapons?
MT
No. I happen to believe in the Non-Proliferation Agreement.
Jonathan Dimbleby (Thames TV)
[speaking over MT]
But the logic of your position is that they should have the right to do it as well?
MT
Not. No. I'm not talking about the logic. I'm talking about Britain's history. I'm talking about the fact that Britain hung on when the rest of Europe surrendered. I am talking about the fact that Britain was right in the beginning of the atomic weapon and many of our scientists, who had done a great deal of work here, went over to the States to complete it. Britain has been an atomic power right from the beginning and I sometimes tremble to think what would have happened had Hitler got that weapon first. We wouldn't be here talking now. So don't take it only the question of logic. Take it on a question of Britain's history, Britain's unique position, the fact that Europe [end p12] would not now be free unless Britain had hung on until the United States. And they are both atomic powers and must continue to be so.
Jonathan Dimbleby (Thames TV)
You are fiercely in opposition to the Labour Party's policy on this. Do you however—and I don't want go into that, if you will allow me not to lead you into that—do you though regard Neil Kinnock as much as a patriot as you are?
MT
I do not comment on what my Leaders of the Opposition or leaders of the other party believe. I believe passionately that the nuclear weapon has kept peace for forty years.
Jonathan Dimbleby (Thames TV)
[speaking over MT]You can't say whether you believe he is a patriot or not?
MT
Passionately.
Jonathan Dimbleby (Thames TV)
You can't say whether you believe that Neil Kinnock is a patriot or not?
MT
I am not discussing him. I am here to discuss the questions for me. I don't discuss a Leader of the Opposition, I discuss his policies. That nuclear weapon has kept the peace for forty years. There is no way that I would put our young people—and if a war starts it is the young that bear the brunt of it—in the field without the same protection as those they may one day face. No way. It would be totally letting them down. It would be totally getting rid of thing which has kept peace. And peace matters to me. A peace with freedom and justice.
Jonathan Dimbleby (Thames TV)
Very briefly Prime Minister, if you were to lose your overall majority would that be the time at which you would say, “I will depart the office of Prime Minister?”
MT
Not, not necessarily. It is possible not to have a total majority but to carry on because you are by far the largest party. I don't expect to lose our overall majority. I hope and believe we shall be returned with it.
Jonathan Dimbleby (Thames TV)
Prime Minister, thank you very much.