Speeches, etc.

Margaret Thatcher

Interview for The Times

Document type: Speeches, interviews, etc.
Venue: No.10 Downing Street
Source: Thatcher Archive: COI transcript
Journalist: Robin Oakley, The Times
Editorial comments: 1100-1210. The interview was published on 26 October 1988.
Importance ranking: Major
Word count: 8869
Themes: Executive, Parliament, Conservatism, Conservative Party (organization), Defence (arms control), Employment, Industry, Monetary policy, Privatized & state industries, Energy, Environment, Public spending & borrowing, Taxation, Economic, monetary & political union, European Union Single Market, Family, Foreign policy (Middle East), Foreign policy (USA), Foreign policy (USSR & successor states), Law & order, Leadership, Media, Northern Ireland, Religion & morality, Society, Social security & welfare, Terrorism, Famous statements by MT (discussions of)

Robin Oakley, The Times

Can I ask you about green issues? There has been a great deal of attention excited by your speech both at the Party Conference and previously to the Royal Society. It seems that it is for governments, on behalf of voters, to decide how clean they want the world to be. Perhaps only the State can make the polluter pay. What practical measures do you plan to follow-up on your recent speeches?

Prime Minister

I think there are two distinct groups of measures. The ones I was speaking about to the Royal Society are the things that really affect the sustainability of the planet itself. In other words, it was the British Antarctic Survey that discovered the gap in the ozone layer. Quite a large gap in the Southern hemisphere. It was the people who have been looking at climatic change and have been measuring the carbon dioxide in the air, that have been talking about the greenhouse effect. Now for quite a time we had assumed that whatever man did was small in relation to the whole of the earth's atmosphere and then all of a sudden we are faced with evidence that it is not. [end p1]

And so you turn round to look at that and say: “Well now, why?” . And then you see, as I said in that Royal Society speech, the rate of change in the last hundred years has been unparalleled throughout history. And that really is causing changes and, just as science has in fact solved the problems of the past, which in a way have given rise to the new problems, so they can solve these problems, and we have got time.

But the message there is we simply cannot ignore it and we have to act together.

Now the other group of environmental issues are the more local regionalised group of issues. And one took what we had done on them from as far back as the Clean Air Act. I remember some of my friends coming to London in the post war period and saying. “Oh, it is so dirty, the soot on the buildings!” . It is much cleaner now, there was the 1956 Clean Air Act.

What we have done on the North Sea we have been doing on various other things. Indeed I think we have got really one of the better systems against pollution. The amount we are pouring into Sellafield in investment is colossal. But what we have done on those things, and things like the Countryside and Wildlife Act in 1981 is an earnest of both good faith and capability that when a problem is identified, when it has a scientific cause and effect, then we deal with it on the basis that we know what to do. [end p2]

As we have done that on the smaller things, we will do it on the bigger things. But we could not leave the bigger things, we really could not, any more than we are leaving the smaller things.

Robin Oakley, The Times

Are you going to set up worldwide conferences?

Prime Minister

There is one of course on the ozone layer. It was the British Antarctic Survey that discovered the gap in the ozone layer. We were very active at Montreal in taking the first steps because although we do not know the full cause and effect, what we do know is that there are some steps that we can take which are very likely to reduce the problem, those we have taken.

I think it is likely that those will not be enough, reducing that particular propellant by about 50%;. We shall have to do more in the future and we will have to look at that very closely.

One on the greenhouse effect of course has very considerable repercussions. Certainly we have got one of the four research institutes on climatic change here, and as you know our meteorology is extremely good and we have got some extremely good people.

But we also have to look at having a much heavier nuclear programme because do not forget the greenhouse effect is partly [end p3] because you are taking a fantastic amount of electricity from coal, so that coal has heavy sulphur and nitric oxide in it and that that causes the problems. Indeed our problems are because our coal is like that and that when you deal with that do not think it is easy, we have got a big programme but to deal with it you have got to hew a lot of limestone out of the cliffs, take it up to the power stations, set it up to absorb the sulphate and then you are left with loads of gypsum.

Robin Oakley, The Times

Yes, and no market for it.

Prime Minister

That is right. And so it is not just as easy as some people think, without creating another problem. Nuclear is of course much cleaner. We are already spending a fantastic amount of money on Sellafield and we have of course finally to decide what to do with the low-level and middle-level waste. But it does not put up carbon dioxide into the air which has a greenhouse effect up there which can start to increase the rate of melting of the polar ice caps and therefore have very considerable other effects. [end p4]

So we are really operating at the two levels at the moment. On the larger level, I was speaking to the Royal Society, I had been interested in it for some time so I did a lot of work on it and came to the conclusion that we cannot leave this any longer. We have got to take joint action.

I had written a foreward to the reply to Mrs Brundtland 's report on ‘Our Common Future’ and we had started to talk about it at the Toronto Summit. But you cannot leave it. Nor, as I tried to say at the Party Conference, can you go back to a kind of village life. You just cannot and nor can you ignore the fact that the Third World will also want to come up to the kind of standard of living which we enjoy.

So you have got, in fact, to have certain rules about the way in which you do it and they have to be rules which do two things: which permit the increased growth but which also enable us to conserve the environment. And we have to work it out. It is no good doing things which have no effect or can have even a damaging effect.

That is why I chose the Royal Society, you have always got to have cause and effect. There are some things which you can do empirically, by virtue of common sense, and other things which we will have to do together. But it is important. [end p5]

Can I just say the third thing about the environment, you know I have been on to for ages. Everyone has a responsibility for the environment, everyone. It is no good throwing stuff down on motorways, chucking cigarette packages out of windows, Smiths crisps packets out of windows, sweetie papers out of windows, and then complaining that the central reservations and the banks on the side of motorways are in a filthy state.

Really, if I have one wish, it is that our people come up to take their responsibilities in this extremely seriously so that our streets will be graffiti-free and as clean as some of those you see in Holland, in Germany.

Robin Oakley, The Times

And in Toronto?

Prime Minister

And in Toronto. And of course in crime too, crime heaven knows is the greatest pollutant of the environment in a different sense, but if I might put in that famous phrase of George Bernard Shaw: “Freedom incurs responsibility. You cannot have the one without the other.” He went on to say that is why many men fear it, but I do not believe so many people fear it now but if they want the freedom, they must rise to the responsibility. [end p6]

So really we are tackling it at three levels and it is vital that we do. People want it, so do I. I do not want to feel that our generation is bringing about fundamental changes on the earth on which we live and is leaving debts to future people to have to take severe action or modify their habits and customs very severely.

Robin Oakley, The Times

One small point of detail on that, are you yourself now heading any particular Cabinet Committee on this subject and related subjects?

Prime Minister

This automatically would come usually to the Economic Cabinet Committee. I have been doing that for a long time, when we had all of the acid rain problems and the nitric oxide burners which we are putting in.

Robin Oakley, The Times

What is your reply to that rather remarkable attack by Stanley Clinton Davies, an unusual use of the office of Commissioner of the Common Market, when he said that Britain had actually been dragging her feet on a lot of what he claimed to be European-wide initiatives? [end p7]

Prime Minister

The most difficult thing I think was the acid rain coming from coal. Yes it did take us longer because it is all very well for some of the other countries that do not get a large proportion of their electricity from coal which is full of sulphur dioxide.

Stanley Clinton Davies would have been the first to have been very critical had we said well we are not going to buy coal from our own resources but from elsewhere. So yes it did take us longer. Had we gone the way which France did, and now got 60%; of our electricity from nuclear, we should not have the problem.

But you know some of the people who are critical on the environment are not exactly helping to get more nuclear power which of course would deal both with your acid rain and with your greenhouse effect at the same time. So yes that did take us longer because we have a bigger problem.

But also, if I might say, some of the people who have criticised us, do not have such clean rivers as we do and do not have such clean seas as the North Sea. The North Sea is clean compared with the Mediterranean.

So if you take our overall performance you will find that it is good. It is some time ago that we put £4 billion announced into cleaning up the Mersey basin. The Rhine is the dirtiest river and the difficulty, the difficult parts of the North Sea are those where the rivers come out away from Europe there and where you have got the Waddenzee you know which is almost not completely [end p8] contained but you have got a lot of pollutants going in there.

Robin Oakley, The Times

Can I move on to the subject of Europe in general and there again you have taken a deliberate initiative with your speech in Bruges. Who is actually trying to suppress nationhood and concentrate power at the centre of a European conglomerate as you put it? Who is trying to create some sort of Identikit European personality, who are your real targets in that speech?

Prime Minister

I think the targets are, if I might put it that way, or the warning goes out to two sorts of people. There are some in the Commission who because they have a lot of Directives to do are trying to get every Directive far too detailed and far too tangled up in restrictions and that was not the reason why we are going towards a Single Market. To go towards a Single Market means reducing the constraints on trade by having the same basic standards but not by maximising, standardising, everything.

And secondly of course there are a lot of countries in Europe who think in a socialist way and therefore their first instinct is to try to get a considerable number of controls. [end p9]

Now that was not the objective of the founding fathers either, the founding fathers realised that if you are going to continue to have your political and personal liberty, it must be underpinned by economic liberty.

And so yes one could see and one could see for a long time the very vague phrases that come out. Having been here a long time, I know that when people talk in vague phrases, whether it is in the United Nations or in Europe, it is because they dare not tell you what they mean.

So I come out with what they mean. Social space is the latest one. “Social space” I said, “what do you mean, you want an extension to your house because you have not got enough living room, what sort is social space?” ‘Social partners’, it is quite absurd until eventually you find that they are trying to tack on a lot of regulations to a European Companies Act which just would be totally unacceptable to us.

You will find people talking vaguely in terms of a federal Europe, it is against the grain of our people. I think it is against the grain of most other people as well.

So what we have done is to bring it out into the open, there it is in the open to those people who were trying to tie it up in more regulations, were going to a more federal Europe. They are cross, all the others are cheering like mad. [end p10]

Robin Oakley, The Times

Do you actually see any need for a European Companies Statute, any need for further protection of workers' rights, as we move to a Europe where national boundaries count for much less?

Prime Minister

No, let me put it this way, as I sometimes said to them, as I did at the last European Council, you regard workers as if they are different species, how absurd, what an old-fashioned Marxist concept! Here are we trying to say, look, a democracy is about equal rights of citizenship. We all have the same vote, we all have equal rights before the law and our task is not to say the world owes you a living but we try to give everyone the maximum opportunity we can to make the best of their own talents.

And here we are saying workers are not a different group from anyone else. We are all workers. What I am trying to say is that every earner shall be an owner, every owner shall be an earner. What are you doing with these out-dated Marxist doctrines? Saying that we must classify people into different groups and there must be struggles between the groups? This is a democracy, not a socialist system where you can get intellectual arrogance and an assumption that one group can dictate to the others because somehow they are better.

But you see it is still there. We are through that. Heaven knows we left that behind. [end p11]

Robin Oakley, The Times

On the wider economic front in Europe, it is not only socialist governments which appear to be interested in the Central European Bank, in a common currency. Why are you so opposed to both the Central European Bank and a common currency and even to British participation in the European Monetary System?

Prime Minister

The same reason, I usually say to them: “please define your terms and define what you mean” . That is usually the end of the conversation because the usual meaning of a Central European Bank is the same meaning as any other central bank, that its role is to protect the currency. Now a central bank in Europe, like the Bundesbank, does not come under the Parliament at all. The Federal Reserve of the United States does not come under the government. It is independent. I am sorry, the Bundesbank does not come under the government in Germany, it is independent and it has to protect the currency.

Our bank, as you know, does in the last resort come under the control of the Treasury but a central bank has a total absolute duty to protect the value of the currency. To do that it has to be capable of determining, without contradiction, the economic policy. In other words, it eliminates both the Commission, the Council of Ministers and the European Parliament. I do not think they will take that. [end p12]

Now if you go to say a fortiori, if you go to a single currency, we should no longer defend that currency, it would have to be a European Central Bank. Now I cannot see and this is why I am constantly saying: “just define your terms, what do you mean?”

If as far as exports and imports are concerned, we have already got an investment bank in Europe, we have already got a bank of international settlements, so I cannot see, as we are very disparate countries, with very disparate economies, I cannot see people giving up, yielding up the direction of their economic policy. I can see us gradually going in the same direction, because what is called Thatcherism in this country is much older than Thatcher, it is common sense, economics, and it works.

We are not going to yield that amount up. I say to them: “Look, are you really going to have a federated Inland Revenue in Europe, in Italy?” I said: “I think you Italians have your ways which we all know about.” And really you know long live the particular characteristics of each people, very entrepreunerial, fantastic number of small businesses.

But that is really why one is saying define your terms, what do you mean, and then I will talk about it. And that is the way to go, because as a matter of fact, in practical arrangements, where things can be done we are the first to do them. [end p13]

Robin Oakley, The Times

You have talked quite a lot about 1992 and there have been a number of scare stories recently. Do you see the risk of major increases in unemployment as European over-capacity is revealed, exposed by the workings of 1992?

Prime Minister

No, if you have got that it will have to go out anyway. It is not going to be worse by 1992, it means that the most competitive will survive and the rest will not, that is what competition is all about.

After all, we all have to sell our output to the consumer. What it should do is to help us to compete the more effectively with the Japanese and with some of the Americans because they have all lost out on the great electronics, Europe has lost out on the great electronics. It is absurd. This is about enabling us to compete with a wider market and therefore to be able to spread your research and development over wider output where companies need a very big market in order to put the research and development in.

It is not for everyone, as I said in my speech in Scotland: look, Europe is good for small businesses too because you know frequently a small business works by finding its niche in the market and small businesses are very good at that. You find your own niche in the market and you can find that and respond to it very fast indeed. [end p14]

To have a higher standard of living you have got to be up with the best and preferably in front of them.

Robin Oakley, The Times

Do you think that Europe could be one of those great underlying issues to divide the party over a period?

Prime Minister

Not when you get down to practical terms. That is what is coming out, it is the people who retreat to the terms which they are unwilling to define I think who are causing the problems. When you get down really to defining it and saying: “Now look are you trying to introduce socialism by stealth, are you trying to do federation by stealth, but if you are it is no good saying to me look your national identity is not at risk and then saying in the next breath of course we have got to have a federal Europe” .

What it has done is to really get the debate on a sensible basis and to stop these vague terms but say: “What do you mean and why do you want it?”

Robin Oakley, The Times

We are approaching a new Queen's Speech, a new legislative programme, are we likely to see a Bill in the course of this year [end p15] tightening up the requirement on the unemployed to prove that they are actively seeking work? Is that something you are anxious to put right?

Prime Minister

You do not need a Bill to do that because there is in fact, it has always been a condition that to accept unemployment benefit, or to claim unemployment benefit, you have to be available for work. The question is what does available for work mean? I think we can tighten up on that without legislation.

The thing is, how can I put it, under the Beveridge scheme the basic idea was that by paying a weekly premium or a weekly stamp in those days or a monthly contribution, you insure against absence of earnings. It is a mutual insurance scheme against absence of earnings, they get it as a right. The absence of earnings come because you are too old to work, because you are deemed to be too old to work at seventy if you are a man, sixty-five if you are a woman, or because you are sick and cannot work or because you cannot get a job.

It is not unemployment benefit as a right because you choose to be idle, it is because you cannot get a job. That goes to the root of the whole thing and I think you will find that in some places where it looks as if there are quite a number of people [end p16] unemployed, nevertheless it is difficult to get people even for unskilled jobs.

Robin Oakley, The Times

London for example.

Prime Minister

Yes, even to get unskilled jobs. So you are entitled, you are honour bound to the people who work honourably and hard, to see those who are claiming are properly available for work and properly trying to get a job.

If there are training courses available, you are bound to say: “But you can, taking a training course, there is skilled work available” . Because it goes to the root of the Beveridge scheme. You are entitled to unemployment benefit because you cannot get a job, even though you have tried.

Robin Oakley, The Times

How are you going to tackle the problem of payments made to single parent families and the high priority given on Council Waiting Lists to single-parent families, actually undermining the family unit, cases perhaps of teenage girls even deliberately getting themselves pregnant these days? [end p17]

Prime Minister

It is a very very difficult issue and we have not got an answer to it yet. It is one of those cases under which the social security scheme was originally designed to help those who are genuinely unfortunate. And so, in the days when there were not many single-parent families, it was designed to see that that family was helped as much as possible.

And then it seemed to be, and indeed we were being told by people who run some of the hostels, some of the most worthy, honourable, wonderful people, that girls were quite deliberately choosing to become pregnant, to get themselves jumping the queue on the Council House list, and getting an income automatically.

Really when you look at the girl next door to that person who says: “Well now, look, I have got a boyfriend, we are saving hard, we want to get married, we want a house, we cannot afford to buy one so maybe we would like a Council house first and then we want to save up to have a family” , are you really being fair to people who are taking that course by letting others jump the queue?

Now it is easier to pose the problem than to find the answer but it is one of the things which I think one has to consider. Is your whole original totally correct right, morally right intention, to help those who are genuinely unfortunate, is it being clouded or are we upsetting the things that we hold most dear by enabling people to put themselves within that group and therefore creating the very problem that really we were setting out to relieve in the first place? [end p18]

It is something which, with looking at the figures, we will have to address our minds as to help the genuinely unfortunate without magnifying the original problem.

Robin Oakley, The Times

The new measures on Ulster which I presume we are going to see more of in the new Prevention of Terrorism Act, do you believe these are really going to increase the number of convictions and will it really cut back on the number of terrorist offences? Perhaps linked with that, are you worried that in the fight to contain terrorism, you are actually eroding liberties which are precious to the society we seek to defend against those terrorists?

Prime Minister

The first, I think on the right to silence, you cannot stop a person from being absolutely silent, there is no way in which you can do it. What you can say, which we have not been able to say in the past, is that the court should be allowed to draw certain inferences from that silence. I have been very interested to hear some of the judges on television say: “Absolutely right, there are too many people whom we believe to be guilty or believe very strongly to be guilty who are escaping justice because of the right to silence.” [end p19]

On the second point, can I put it this way, there are those in society who deliberately use freedom to destroy freedom. They not only use freedom to destroy freedom by propaganda, by distortion and so on, they use the gun and the bomb to destroy freedom.

None of us can be neutral, as between the terrorist and the law-abiding citizen. None of us can be neutral towards the police, any army whose job it is to uphold our liberty and security.

I am immensely grateful to the newspapers who firmly, not merely recognise this, but do all they can to uphold it. So we are not spectators in the battle against terrorism versus law, give those their chance they will destroy democracy itself because they wish to crush decisions by the ballot box and replace it by decisions by the bullet.

Of course if you believe in democracy in a rule of law you are bound to take action to protect the innocent. You would understand better I think if one was openly at war, openly at war there are certain rules of war to which you adhere but you are all fighting the same rules under the same rules. When you get terrorism, you have got one side at war, using the rules of war, indiscriminate killing, even worse sometimes than the rules of war, indiscriminate killing, killing by methods, beating people with sticks, dragging them from their cars, utterly, utterly, repugnant, by torture, and the other trying to fight them with ordinary civil rules. [end p20]

Now sometimes when those civil rules are not sufficient yes you do have to modify them, that is why we had to modify them in Northern Ireland, that is why we have to modify them now, because those people recognise no civil liberties and even here in wartime remember you have in order to beat off your enemy in a war, to suspend some of your civil liberties for a time. That is why we had internment under 18B, civil liberties had to be suspended until the enemy was beaten and until democracy, freedom and justice was seen to survive. Then once again it was restored.

Now we have been very very careful, very careful indeed. We recognise the terrorist for what he is, he is for crushing innocent people, for abolishing the ballot box and for substituting the bullet, the bomb, torture, maiming, to get his own way.

Robin Oakley, The Times

Just one technical point on that, what are you going to do on the question of the Sinn Fein broadcast ban, what is going to happen when a lot more satellite broadcasting is beamed into Britain in terms of preventing access to terrorist sympathisers? Won't there be a great enforcibility problem there?

Prime Minister

I doubt it very much. There might be on some and I would have to reply in the same way that I have to reply on other things. [end p21]

The only thing we could do here is to make it an offence to beam such stuff into this country if need be. We try to get a code of conduct on pornography and such like and to make it an offence to advertise with those who do not accept a certain code of conduct.

I do not wish the extension of television to be a signal for falling standards. I think that is the same view that the overwhelming majority take in this country. They are worried about falling standards and they know that having a picture night after night in your living room is the most powerful form of influence ever known on this planet.

It is quite different even from a newspaper, quite different. And to have something piping to you things which are not characteristic of life but which give you the totally wrong impression of the balance of life as between good and evil can be highly damaging to your society and terrorism is against liberty, it will be the extinction of liberty and people who use it must not necessarily expect to be treated in quite the same way as those who uphold it.

They are avowedly out to substitute violence for choice.

Robin Oakley, The Times

On a wider frame, I wanted to ask if you are happy with the regulatory apparatus in the public sector? Is it wise, for example, for the Department of Energy to be responsible for safety [end p22] examination of rigs like Piper Alpha and has the licensing system of the DTI not been shown by Barlow Clowes to be woefully inadequate and could the answer be more private sector regulation by top-class professionals, paid for in some way by those they regulate?

Prime Minister

No, I do not think so. I think that the Health and Safety Regulations on rigs are far better in the Department of Energy, where they are operated by people who are very very familiar with the problems.

You have got to have national safety regulations and national health regulations either on a great deregulator where constraints are not needed and at the same time very strong to see that certain basic standards are observed. That is the task of Government to set the framework of essential regulation and to see that it is adhered to and only Government can do that.

My whole belief is that you get out of doing those things which you should not be in and you concentrate on doing those things which only government can do, so you have immense strengths as a government on the things which only government can do and you get out of the areas like controlling prices, incomes, foreign exchange control, stopping companies from developing where they want to develop and sending them where they do not want to develop. [end p23]

You get out of that kind of control, you get out of running industries, but you have the right regulatory framework.

On the financial services, it was because the previous Acts were so out-dated that we went to immense lengths, consultation and then the Gower Report, to put into operation the new Financial Services Act which, as Tony Newton explained in the House of Commons, came into effect fully after the problems which you have just mentioned.

They were because we knew that that was inadequate and it is again a general duty to see that your law reflects contemporary problems and that is why you are constantly having to bring forward revisions of law. When you do bring them forward you have to be very careful that you again get them right.

The problem there was that the new law came in after the problems to which you referred.

Robin Oakley, The Times

Do you have a personal sympathy with those who have suffered in the Barlow Clowes affair or do you feel that it is perhaps a wise warning for our society that those who go in for investment and so on that there are risks attached and that there have to be losers as well as winners? [end p24]

Prime Minister

Let me not say anything more about the Barlow Clowes affair because there may well be many many legal cases and I cannot. One always has sympathy with people who lose their savings, always, of course you do.

I remember when the Stock Exchange crashed to 150. I thought that when we were criticised by some of the people opposite, crashed and people lost a very very great deal of money. You just have to use your own judgement on where to invest and take the very best advice that you can.

I cannot go any further. I do not know whether people have read the full report, but obviously there are all kinds of considerations which people are considering at the moment.

When the Stock Exchange crashed to 150 which as you know was in about 1975, do you remember, that was a major crash, 150 and today it is what, 1700, it crashed and many people crashed with it. The lifeboat referred to then did not involve a penny piece of taxpayers' money. It was loans by the Bank of England to secondary banks so that they did not have to call in their own loans, loans which were repayable.

Robin Oakley, The Times

Thinking back to 1979, privatisation was then little more than a gleam in your eye. We did not even hear that much about it in the manifesto then. Talking to Ministers and people at the [end p25] recent Party Conference, people were saying, “Well, OK we go on, we go on, we do some more privatisation, we sell a few more Council houses, but we have got to be thinking now about what is the big new idea for the middle of the next Parliament because we have got to be starting to set things in motion now for what we are going to be doing in 1995.” What is the new gleam in your eye that might be one of those big ideas within the next Parliament?

Prime Minister

First, we have to complete the denationalisation programme. Governments ought not to be in business. They are only in business to interfere with it. They are not as good at running it competitively, as those who are close to the ground, and so we ought not to be in business and these businesses do much better when they are out of government hands and if they be only existing on very very heavy subsidies then if you are going to put subsidies into industries of yesterday you are denying the money from going into the businesses of tomorrow.

Now when we have done that, do not forget the real renewed thing that renews itself generation after generation is the spirit of enterprise. It is that which takes life forward, it is that which sees the new things in the market, it is that which brings the new products to the market and you have to compete the world over. [end p26]

This is the new things, the new commerce, the new industry, the people are rising to the opportunities. I think one has to be very wary and not fall into a trap. There are still people who think that new ideas can only come from governments. Governments have got to have a new idea but we are a free people, we do not have to be told, do not have to be told what initiative to take. We are a free, enterprising, independent people, let us rise to the opportunity, not turn round and say: “Dear Government, what would you like us to do next?”

Heaven knows, these are independent people, they are British. [end p27]

Robin Oakley, The Times

But governments themselves have to keep busy through a parliament with new programmes of legislation.

Prime Minister

Yes, of course. As I have indicated, we have to keep our law up to date; you have to have the right framework of law in which enterprise can operate; you have to have the right defence, because only Government can do a defence; you have to take the Government's part on the rule of law, knowing full well that it is a partnership; you have to defend your currency; you have to negotiate international trading agreements, because those are done internationally; you have to do international aid; you have to try to see that your law is such that it gives people maximum opportunity—and that really is the great thing now: to see that those who have not yet been able to take advantage of the opportunities are given new opportunities. Hence, the Education [end p28] Act, which has to live, and it is the Government's task to watch that children are getting a good education. That the training and the Health Service is being managed properly, operating properly; and that you have fundamental basic social services. It would be totally repugnant in a complex society like this which is wealthy, that there were people whom we did not know about who were hungry, had no shelter, were not clothed properly and because we cannot know about everyone, we have these essentially basic social services.

Then you go above that and you say: “Look! The more you earn, the more you shall keep! You keep a greater proportion of what you earn!” because it is people who enlarge their own lives.

Again, the fundamental rules about the environment. That is very very important.

So we—the basic defence, the basic rule of law, the basic finance, the fundamental rules, the fundamental conditions necessary to give opportunity to an ever larger group of people—and all the international negotiations, whether it is in trade or whether it is in other spheres, and a certain amount of international aid as well.

Robin Oakley, The Times

Can I take you swiftly on to foreign affairs then?

What will be the burden of your advice to President Reagan 's successor when you go to Washington? [end p29]

Prime Minister

I think that the policy which has been pursued is very much in tune, which you know is everything that I believe in, and that has really been very obvious.

I think there is only one fundamental difference and that is that I do not believe in budget deficits. We have got rid of our budget deficit now and we are into a period of budget surplus, when we can redeem the debt which other people have built up in the past.

I remember President Reagan was very keen to have a balanced budget in his early elections, but he said: “If Congress insists on putting up public expenditure, I am not going to put up income tax because that is the way it has been done in the past and we shall have the same spiral going!” He tried to say: “I am the first to want to get down public spending and it is up to Congress to do it, because they have the final say!”

I have said: “Look! I would like public spending down proportionately a little bit more!” and now, as a matter of fact, we are getting it down, but in the early days, when we were in a recession because of the rapidly increasing price of oil, I could not get it down, then I said: “I simply must finance it by taxation. I am not prepared to have big borrowing to put an enormous debt on future generations!” so we kept our borrowing within very strict limits—and am I glad we did!

Yes, we did take tax down. People have to have an incentive and if by taking down the top and middle rates of tax you create more wealth in order to help the people who are the least fortunate, then that alone is a good enough reason for doing it. [end p30]

So that really, has been the only difference between us and it is a small one.

Robin Oakley, The Times

Yes, and that is a message you would perhaps underline.

Are you worried that the West is moving too fast now on arms limitation? Will you be uttering any cautionary notes there of perhaps being too starry-eyed about Mr. Gorbachev?

Prime Minister

I do not think at the moment cautionary notes are needed, because I think that America is being cautious about the 50 percent reduction in strategic weapons, because you have got to have the right balance among the different kinds of weapons and to see that you still, at the end of the negotiation, have not undermined your fundamental security and the fundamental balance.

So I think they have been absolutely right. It is more important to get the right agreement than to get a quick agreement. In any case, if I thought they were going too fast, I would always come in and warn.

You know, it takes a long time, your weapons are so complicated these days—it takes ten, fifteen, twenty years to build up a new weapon system and a wrong decision now could put your security in [end p31] jeopardy in five, ten, fifteen years time, so you always have to watch that you do not make the wrong decision and you know that in a period of great uncertainty—and it is a period of great uncertainty in the Soviet Union and in the satellite countries—you do not take any risks. You play safe.

As you know, I am the first to say that I hope Mr. Gorbachev succeeds. We will do everything possible we can to help, but you do not take risks with the security of freedom and justice.

Robin Oakley, The Times

And you do not give Marshall Aid to a society perhaps like “glasnost” .

Prime Minister

I just think, you know, that these phrases come out and it is just not appropriate. What we each of us try to do is give a certain amount of credit to get trade going, because the Russians have a very very good record on meeting their debts and accounts. That is quite different. That is in the normal trading business of credit of the right amount. [end p32]

Robin Oakley, The Times

You talked a great deal in the summer of the need for a new conference to help work towards peace between Israel and the Arab nations. Do you see any significant progress in that area? Is that something that you will be pushing the new President on and are you doing anything specific to bring it about?

Prime Minister

There are two lots of elections, aren't there? One in the United States and the other is Israel.

It would be my hope when the United States election is over that they really will strain every muscle, every effort, to try to sort out the differences between Israel and their Arab neighbours and the legitimate aspirations of the Palestinian people.

It is very encouraging that the other Middle Eastern problem—the Iran-Iraq one—is on the way to solution. That came quite suddenly and quickly and I think that most peoples of good will would like to feel that we could have a secure peace in that region: secure for Israel, that she might at last live in peace within secure borders, giving the Palestinian people their legitimate aspirations, because you cannot demand for yourself what you deny to other people, and I hope that this will be on the front burner after the American presidential elections and that their efforts will meet with a great welcome, both with the new Israeli government and with the Arab peoples, because now I think we are beginning to realise [end p33] more and more that the real security lies in proper peace agreements, each respecting the rights of the other, backed up by proper defence always.

Robin Oakley, The Times

If I can ask you briefly about the economy, because you have to talk about that a fair amount at Prime Minister's Question Time anyway, but will we ever see a real lift-off in manufacturing output and can the improvement in the economy be sustained now that inflation is climbing and Nigel Lawsonthe Chancellor has warned that the trade gap will not reduce significantly before 1990?

Prime Minister

Inflation is lower than it was at any time—at any time—during a Socialist Government.

It is too high and it has got to come down—and it will come down, let there be no doubt about that.

Manufacturing output is at an all-time record. They are doing quite well on exports, but unfortunately the savings ratio in this country has dropped and people, rather than saving, are buying consumer goods and not only with money they have saved, but the borrowing is too high and that is why we had to take steps to make the borrowing more pricey and the saving more beneficial. [end p34]

Robin Oakley, The Times

More steps to come on making saving beneficial?

Prime Minister

They are quite severe steps. Let us see how this works. We are always on the watch. If anything else needs to be done, it would be done. As Nigel Lawsonthe Chancellor said, the interest rate will have to stay high for quite a time to correct this imbalance, but I have the impression that it is beginning to work.

You know, the figures on savings ratio I know are notoriously unreliable, so I am always told. There has been a trend downwards, which is what bothers me, and you know, the fact is that the countries which have a very high savings ratio—Japan highest of all and Germany—are the countries which of course have much lower imports and higher exports and our savings ratio is too low at the moment.

You see, your savings have got to be enough to finance the immense investment that you want to put in, both in your private sector and your public sector, and if they are not, then you are drawing in other people's savings, and that cannot last and this is why you have got to get up your savings, because there is very high investment in manufacturing at the moment and in general commerce. We have also had a period of quite high investment in hospitals, roads and so on, but basically, you have to have savings equals investment. If not, you are in difficulty. [end p35]

Robin Oakley, The Times

The little local difficulties that there appeared to be between you and the Chancellor earlier this year on managing exchange rates and supporting the pound, are you and he totally friends again and will Alan Walters be joining you here?

Prime Minister

Nigel LawsonThe Chancellor and I are absolutely at one—and always have been at one—that inflation, getting it down, is the top priority. We say it time and time again. We then think that people have got bored with us saying it and then when he just did not say it—I am told did not say it sufficiently strongly—then they wondered if he had come off it. Of course he has not come off it! Neither of us have.

Our RPI, as you know, is calculated very differently from other people's in that we have the mortgage rate in it, which is not in very much on the Continent. The Chancellor and I are absolutely at one, we have to get inflation down and the requisite steps must be taken to do it and we have to keep a firm hand on public spending.

Robin Oakley, The Times

Would you like to see the mortgage rate taken out of the RPI calculation? Could you do that? [end p36]

Prime Minister

Well, we did ask the inevitable committee which considered these matters and they said leave it in so that is sorted out. It means that you get more ups and downs than you would otherwise. It is bad when it is going up, it is good when it is coming down, but they did pronounce on that.

Robin Oakley, The Times

Can you confirm whether Alan Walters will be returning as your full-time adviser next year?

Prime Minister

I hope and believe Alan Waltershe will be returning next year. I am not quite sure on the precise terms on which he is able to come.

He is in so much demand everywhere that I am not sure that he would be able to be full-time, but his advice, as you know, is very valuable. He is that remarkable person: he is a very modest economist and a very effective one!

So, I might say also, because I have the greatest admiration for him, is Terry Burns. It is not surprising that he and Alan get on very well. They are a pair of modest economists and very effective. [end p37]

Robin Oakley, The Times

Prime Minister, you said in your Party Conference speech … there was this little passage when you said: “We are all too young to put our feet up!” You did not actually, as far as I could hear, give us the next line, which was “and I hope you will excuse me if I include myself!” I trust that does not mean you are considering putting your feet up.

Prime Minister

I did say the next line, but the applause came and totally obliterated it, but if you listen carefully … and I stand by that line in the text!

Robin Oakley, The Times

Now, is it your firm intention still to be leading the Conservative Party at the next election?

Prime Minister

I would wish to do that. It does not wholly depend upon me, of course.

Robin Oakley, The Times

And do you ever have any date-line for your own retirement? [end p38]

Prime Minister

No, but obviously, one is not indestructible—quite!

Let me say, as I have always said, what matters to me more than anything else is that the things we believe in and the things that we have been able to do are carried on fully and forthrightly into the future. Some time there may come a person who can do it better than I can. I am always on the look-out, but I expect myself to do it for the fourth. … I hope to do it for the fourth term and hope that we would be returned for a fourth term on the basis of what we have done and that we are always on to the next steps.

You know, you never sit back at success; you work jolly hard at it, and I think that in our attitude we are way ahead of some of those European countries. As I say, we are looking at people as we are all one in the sense that we are all equally important but all different. But you do not classify them into groups, classes, anything like that. We each have our own talents and abilities and we are all different and we are all important.

Robin Oakley, The Times

Prime Minister, have you changed in the process of doing this very onerous job?

I remember you said initially that the Cabinet would be your political advisers and there are some who say that the appearance is now that you rely increasingly on the No. 10 machine and the Policy Unit and so on. Do you find yourself using the Cabinet in a different way to how you first intended? [end p39]

Prime Minister

No. We have lively discussions in Cabinet and in the many Cabinet Committees.

I think it is perhaps not surprising that after nearly ten years of quite successful policy that we do now always appreciate the kind of success which those policies have achieved and therefore there is a greater unity about those going on and a greater understanding that in order to keep that success you are never absolved from making difficult decisions, but there is no fear of making difficult decisions now in Cabinet. They know that it is because we did not run away from them that we got through.

Yes, the Policy Unit is extremely good and I find it much more useful than the Central Policy Review Staff was, because they were too many and they were right through the green baize door—or is it the brown baize door—they are right in the Cabinet. The Policy Office is just along the corridor. They can come in quickly. We run a very informal kind of set-up and Heaven knows, we see a great deal of one another in Cabinet and Cabinet Committees and Ministers frequently come in about their problems—of course we talk about them.

I must say this to you: I am astounded at how few prime ministers have the kind of relationship with Parliament that we have. [end p40]

When I went to Spain, for example, I went to the Parliament and I had to see eleven leaders of the Opposition because there were eleven small parties and they were at the other side of the table and they each made their speech—three points—and then each asked two or three questions and it took quite a long time and they then thanked me very much for it because they had not had the chance to question a prime minister like that before. It was the communists who said that, not that one should put too much weight on that. I said: “But doesn't your Prime Minister come down and answer questions every week?” “No!” I said: “Well, I answer questions every Tuesday and Thursday I have to know just precisely” and of course, it gets cumulative and then I say to some of my colleagues it makes you understand the different approach to Europe. I said: “I come back from a Council of Europe, of Heads of Government, I will be, within the next two days, making a statement to Parliament!” Oh they say: “We will make a statement to Parliament!” I said: “Yes, but how many of you will stay on to be questioned?” —and not many! I have to stay on and be questioned for about an hour.

So it may be, you know, that Parliament means a great deal in our system. Obviously, it does also in the Danish system and the Dutch system—any place which has a coalition—but there it is not always that the arguments go on in Parliament, but the experience [end p41] gets cumulative, the knowledge gets cumulative. You are in a far better position to tell me whether I have changed than I am to tell you whether I have changed.

Robin Oakley, The Times

I was just going to ask you, Prime Minister, one possible change that I thought I saw was following your speech to the Churchmen in Scotland. I wondered if religion was becoming more important to you in your personal life and in your attitude to policy questions.

Prime Minister

One is very very careful, as a politician, to speak about religion because it is a personal thing—very very careful indeed—and always extremely careful never to say that I hold these views because of my politics, because you do not hold them for that reason. I have always taken the view that the great human rights come and the great significance of the individual in the democratic system relied for its birth upon the kind of personal responsibility and accountability which you get both in the Old Testament and the New, which you do not get in the other religions. When I was asked to speak to the Scottish Assembly, I said what I believed. I said I believed it as a person, but I am very very careful—very careful. There are people on all sides of politics who are fervent believers in Christianity and fervent believers in Judaism. [end p42]

Robin Oakley, The Times

You are now talking a lot more about the concept of the active citizen and of ideas of social cohesion and so on …

Prime Minister

Social cohesion? It is not a phrase I ever use! What is social cohesion? The one that one does use is the general fabric of society that you are. There is a concept of nationhood; there is a concept of community, the village, the town, working together, the neighbourhood. It is the neighbourhood, really, isn't it? Keeping the whole neighbourhood together. There are certain things you do together, and that also was in the speech.

Robin Oakley, The Times

Do you feel that there is a sluggishness sometimes that irritates you? You say you want to go on and on and on and you have this tremendous drive, but don't you get fed up sometimes with the sluggishness of people's responses to what you are trying to do?

Prime Minister

I think that there is still far too much thinking in this country which we have not got rid of yet that “I have a problem, the Government must solve it!” and that is why I say the price of freedom is the acceptance of responsibility. First for your own [end p43] life, then for that of your family, then for that of your neighbours and you and your neighbours and your fellow citizens have an understanding with one another—yes, a mutual insurance—we will look after you when you are unfortunate, provided you look after us when we are unfortunate. Can I say it is a kind of tapestry of the people of a nation, but you do not get a responsible nation until you get a nation of responsible citizens and the price of freedom is the acceptance of responsibility and that if you have a problem you do not immediately say: “Well, the Government must do something about it!” You say: “Well, it is for me first!”