Mr. President, Ladies and Gentlemen, I am proud and delighted to speak once again from this platform at Perth. It was here that I made my first speech as Prime Minister. From here I launched the last two successful election campaigns. Today, I launch a third campaign: a campaign to strengthen the Union by winning back Scotland for the Conservative and Unionist cause.
The Conservative Party is the oldest political party in Scotland. We have had our share of triumphs. We have been through challenging times— [end p1] but we have never ceased to serve the interests of Scotland, indeed, of the whole United Kingdom.
Today, we have hard work ahead of us—to turn the electoral map of Scotland Conservative Blue once more. But your lively and candid conference these last three days has confirmed that it is we in the Conservative Party who are doing the new thinking for the new Scotland.
It is Malcolm Rifkind and his team at the Scottish Office who are setting the policy agenda with style and conviction.
It is Jim Goold, John MacKay and their colleagues at Central Office who are rebuilding the organisation that will win our future victories.
And it is Alec Home who has set a tradition of service to Scotland and the Conservative Party which is matchless. [end p2]
THE ECONOMY
Mr. President, I'm sometimes told that the Scots don't like Thatcherism. Well, I find that hard to believe—because the Scots invented Thatcherism, long before I was thought of.
It is more than two hundred years since Adam Smith, David Hume, Adam Fergusson and others first set out their ideas of a world in which wealth would be generated and spread ever more widely.
They saw that it's not Government which creates wealth—it's people. That People do best when they pursue their own vision. And that a wise Government will harness the efforts of individuals to improve the well-being of the whole community.
So they proposed to restrain Government and to liberate men and women. [end p3]
Mr. President, those are the ideals I hold most dear. And they had their origins in the Scottish Enlightenment.
They were ideas that changed the world. The industrial revolution, the expansion of British trade, the development of new nations, the spread of new goods, new technologies, right across the globe, benefitting millions of people who had never heard of Adam Smith, or David Hume, or indeed of Scotland—that's the history of Scottish ideas in action.
It is also the history of Scottish Enterprise. The British Empire could never have flourished as it did if the Scots had not been there to build the roads, cure the sick, establish industries, promote trading links, and to map out the unknown territories.
Scotland herself flourished in the days when Glasgow was the Second city of Empire, and a quarter of the world's ships were launched into the Clyde. But an economy in the forefront of the first Industrial Revolution was bound to face major problems adapting to the Second. [end p4]
When that challenge came, Governments failed Scotland—not by doing too little, but by promising too much.
Successive governments promised to insulate Scotland from the reality of industrial change. They told you: “You don't need to worry. We'll protect you.”
But they couldn't—and they didn't Shipyards closed. Factories closed. Men lost their jobs. Whole areas turned to wasteland. And the money that might have been invested in new industries, new opportunities, went instead in trying to keep yesterday's jobs alive.
The result was that the economy fell faster, apathy and despair spread wider. And disillusion with Government grew deeper. It was as if the Scots concluded: “If Government can't save us, what on earth can we do?” [end p5]
What had happened to the enterprise of Carnegie, James Watt, John Macadam, Alexander Graham Bell? Where was the energy which had founded great Scottish companies along the banks of the Clyde? And the canniness which had made Edinburgh one of the first centres of international finance?
Today the Scots have answered those questions by their actions. Those qualities were always there—but they were buried by overgovernment. This Government has liberated the energies of the Scottish people.
And Scotland is on the march again.
With the benefits of lower company taxes, growing market opportunities, and rising standards of living, new companies are springing up. Nearly 6,000 of them were registered in 1987 alone. [end p6]
Scotland is a world leader in the industries of tomorrow, in electronics, in computer sciences, in financial services. Over £80 thousand million pounds of funds is managed and controlled within one square mile of the centre of Edinburgh.
That's equal to two years income tax for the whole United Kingdom. Mr President, the situations vacant columns of Scottish newspapers are bursting at the seams—offering real jobs founded on real needs.
Who has benefitted most from this great surge of progress? The Scottish people. Judged by cold statistics, Scots enjoy greater prosperity than anywhere in the United Kingdom outside the crowded, high-priced South East. But no statistic can capture the benefits of living in a civilised city within five minutes of some of the finest scenery and fishing in the world—not to mention a handy golf course and a distillery or two. I am told they sometimes go together. [end p7]
Mr. President, this Scottish miracle didn't happen by accident. Indeed, it could never have happened at all if the Government had been in the hands of the negative, bitter, class-ridden, and backward-looking, Labour Party that Malcolm Rifkind and I face daily in the House of Commons.
It happened because the Tory Government set the Scottish people free.
Free from Labour's controls on their wages.
Free from Labour's restrictions on enterprise.
Free from Labour's penalties on investment.
Free from Labour's punitive taxes on effort.
Free from all the shackles that Socialism had imposed on the work and imagination of the people. [end p8]
Mr. President, as someone once said, the people had nothing to lose but their chains. They had a world to win. And they are winning it.
Investment coming to Scotland has soared—but first we had to abolish exchange controls.
Financial services have mushroomed in Edinburgh and Glasgow—but first we had to deregulate the industry.
The unions are back in the hands of the moderate majority—but first we had to change the law to control the militants.
Above all, the Scottish economy is now infused with the spirit of enterprise—but first we had to get taxes down.
If Labour's income tax rates were still in force, a Scotsman on average earnings would be paying nearly £15 a week more to the man in Whitehall than he is paying today. [end p9]
Mr. President, we believe in incentives to create wealth; the Labour Party believes in taxes to redistribute it. That is the great divide in politics.
Labour's high taxes don't redistribute income. They redistribute taxpayers—from high-tax countries to low-tax countries. They redistribute accountants—from improving efficiency to avoiding tax. They redistribute work—from honest employment to the black economy.
And under every Labour Government since the war, high taxes have redistributed economic success from this country to West Germany, to Japan and the United States.
What we have done is to reverse that process.
We have given everyone more incentive to work, to save and to invest.
We have encouraged unskilled workers to try for a job and train in new techniques rather than be demoralised on the dole. [end p10]
We have persuaded the wealth-creators—the scientists, the businessmen, the entertainers—to stay in this country and pay their taxes here—not to our competitors abroad.
We have generated prosperity and, with prosperity, jobs.
In those difficult days of the early eighties, I used to be asked: where will the new jobs come from? I had to tell people: Government's don't know what the jobs of tomorrow will be. And when they try to guess, they get it wrong. But what we do know is that when we get the conditions right, the jobs will follow.
Today I can reply: look around you at the new factories, the new industries, the new signs of commerce and prosperity. The jobs of tomorrow are here. [end p11]
A month ago, I visited IBM's plant in Greenock. In 1951 it employed ten people on what? Assembling typewriters. Today, in 1988, it employs 2,500 people and supports 4,000 more. The day I was there, it produced its two millionth personal computer. The same day I opened a new five-crown hotel in Dundee, built at a cost of four million pounds and employing a staff of 120. And for good measure, I was able to announce up to another 300 new jobs at a new medical science centre at the nearby Technology Park.
Mr. President, Scotland is changing before our eyes.
This Government has worked hard for that kind of prosperity. Scotland has worked hard for it too. And that is why I get pretty upset when it's thrown away. [end p12]
Scotland won Ford for Dundee. LABOUR LOST IT.
And let that be a reminder—a reminder that Scotland's soundly-based, dynamic economic revival could never have happened under a Labour Government. Even out of power, the ghost of Labour stalks the industrial landscape, frightening away foreign investment and chilling the prospects of growth.
As a great Glasgow journalist, Colm Brogan, once remarked, wherever a Labour Government attempts to increase human wealth and happiness, grass never grows again.
And when Labour is presented with the evidence of Scotland's success in tomorrow's world, they shut their eyes to it. They don't want to know.
And sometimes, Mr. President, the media shut their eyes as well. [end p13]
So perhaps I should take the opportunity to reassure them that news of Scotland's success is not covered by Section Two of the Official Secrets Act. Perhaps if we labelled it secret, it might make the front page.
AGRICULTURE
Mr. President, no Tory ever forgets the vital importance of farming to a prosperous economy and a healthy society.
Today, Scottish farmers have to compete in a world where trading conditions are tough and surpluses abound.
Within the European Community, we have had to put a limit on the budget in order to reduce those surpluses and to bring supply more in line with demand.
Otherwise the CAP would, quite simply, have run out of money. And the victims would have been farmers and farm workers alike. [end p14]
So Britain brought our European partners to face reality. They haven't always welcomed that!
But Scottish farmers have never been afraid to face reality. All they ask is that the competition be on fair terms.
That's why this Government has repeatedly fought in Brussels for a fair deal for our farmers—in lamb, beef, cereals and much else.
That's why we've reformed the tax laws so that the family farm can be passed on to the next generation—one of the best deals for farmers anywhere in the Community.
That's why we have cut the rate of tax on small farmers.
As a result, Scottish agriculture—never afraid to adapt to change—has established major export markets. [end p15]
And speaking of exports, I must congratulate the Scotch Whiskey industry whose exports exceeded one billion pounds in 1986. I'm told it's Scotland's largest, single export.
And, as I told the Noboru TakeshitaJapanese Prime Minister last week, it could do still better if foreign countries didn't protect their pale imitations behind devices like tax discrimination—which leave a very nasty taste in the mouth.
THE COMMUNITY CHARGE
Mr. President, at each of our last three conferences, you have sought assurances from me that we would abolish the domestic rating system. Nobody could tell the Scots that revaluation was fair. It wasn't.
That's why you wanted a better system—and that's why we are replacing the old, outdated, arbitrary and unfair system of local rates with the Community Charge. [end p16]
It is absurd that out of almost four million local electors in Scotland, only one million pay full rates, and two million pay no rates at all. Yet all four million use local services and benefit from the rates paid by their neighbours. What's fair about that?
It is equally absurd that the same rate is levied on similar properties, however many people are living in them. Yet local services are used by people, not by houses.
Why on earth should a retired widow living alone in the family home pay the same rates as four working adults next door? What's fair about that? There's nothing fair about that. A system of finance which totally separates local democracy from financial responsibility is wrong at the root.
If we are to have responsible and accountable local government, a clear link between the services [end p17] provided and the charge levied is essential. That is the principle behind the Community Charge.
The charge does not cover the whole of local spending. In Scotland, it will account for only one seventh of the total.
But it is designed to ensure that the same level of services delivered with the same degree of efficiency will result in the same community charge for every person in Scotland—subject to generous rebates for those who cannot afford to pay. And it will be the same system throughout England too.
But let us be clear. The local level of community charge is not set by the Government. It is set by local councils.
An extravagant and inefficient council will have to charge more, and a prudent and responsible council will be able to charge less. [end p18]
So, when every local resident pays a community charge the councils will have to justify their expenditure to the voters.
Voters in Labour Edinburgh will want to know why on current figures their community charge would be £70 more than the charge in Tory Eastwood.
Hard left councils will no longer be able to hide the cost of their socialist fads and anti-nuclear fancies by passing them on to business and the ratepaying minority.
They will have to send the bill to everyone—and face the consequences at the next election.
EDUCATION
Mr. President, two bills are now going through Parliament which will radically change education. They will provide for parents to play a much greater role in the education of their children.
In Scotland there is a tradition of excellence in education which our opponents constantly threaten. [end p19]
Some of you may have heard of Paisley Grammar! That school and others like it were under threat from Labour because their values and traditions were resented. They were popular with parents. They had high academic standards. They enforced high standards of discipline. We have given them a right of appeal. Labour hated it. The parents loved it.
Let Labour be in no doubt about the message. We will defend the rights of parents and the education that they seek to attack.
SOCIAL SECURITY
Mr. President, day after day, week after week, in the House of Commons and elsewhere, we have been treated to the sound of sanctimonious Opposition politicians loftily congratulating themselves on their superior compassion—with particular reference to the health and welfare services. [end p20]
Well, here are the facts. We are not spending less on these services, but more. A lot more.
On both of them. On the NHS nearly £2,000 million pounds more this year. And with this Conservative Government, the nurses and doctors have had the largest pay increases ever—something that has been greatly welcomed. On social security also we are spending another £2,000 million pounds more this year. In fact for every three pounds that Labour spent on social benefits, we are spending four pounds—and that's after allowing for inflation. It's not a figure you will hear from Labour.
But in social security—it wasn't only a question of spending more—a number of problems had grown up over the years and they simply had to be dealt with. [end p21]
For example: —the system of social benefits we inherited was telling young people that living on benefit was an acceptable substitute for being in work. So some young people were choosing to be idle. That was wrong—so we stopped it. For those who couldn't get a job, we offered training instead and we paid a training grant. That way they learn a skill for the future—and the habits of work and self reliance. That was right and most parents and sensible people agreed. —And then, some families on low wages with young children found that they were worse off if they worked harder and earned more. They lost benefit. That too was wrong—so we have introduced ‘Family Credit’—a new benefit. So that, overall, they now keep more when they earn more. That will help 400,000 people to keep the dignity and respect of working to provide for [end p22] their own families. Another good and necessary reform.
—Then we found that the cost of housing benefit was rising dramatically from one and a half billion pounds in 1979 to over five billion pounds this year. It was going to an increasing number of households even in times of much greater prosperity. In fact, every two households not only have to keep themselves but also contribute to a third household. That is still so—even after the reforms which we have just brought in. This year expenditure will be £5.3 billion—but we had to take the steps we did to contain its growth in future years. —And then, we have tried to give special help to the long-term sick and disabled. But with something like twenty possible extra allowances—it's hardly surprising that some people didn't know where they were. Or what they could claim. [end p23] So we have rolled them all into one benefit which covers almost all disabled people. All told, and in real terms, we spend eighty per cent more on this group than when we came to power. All this is taking time to sort out. But the reform is a good one. A compassionate reform. A real Tory reform. And to people who are retired let me say this: It's not only a question of providing more for each pensioner, but providing more pensioners too: something like a million more since we took office. And while the number of pensioners will continue to increase over the next decade, the population of working age will decline.
On top of that, the promises that had been made for the second pension—SERPS—were too great for future generations to bear. [end p24]
We have honoured our pledge to protect the basic pension against rising prices. And now we have safeguarded pensions by putting them on a sound financial basis—one that is fair all round.
And we have done other things to help the pensioner: —slashed inflation, so your savings are safer with a Conservative Government. —abolished the Investment Income Surcharge —and introduced an extra tax allowance for the over eighties.
Those who are now retiring can do so, secure in the knowledge that they can look forward to a far better future than was ever imagined a few years ago.
That is the measure and purpose of the reforms you have heard so much about—they strike a balance between those in need and those who provide.
Our purpose is to ensure that the recovery now taking place will benefit all the people. [end p25]
Yes, our reforms have cost more and they will go on costing more, but like our financial position as a whole, they are soundly based and will endure.
DEVOLUTION
Mr. President, since the Act of Union, Scotland has had a proud history as a distinctive nation within the United Kingdom. We in this Party believe in a Scotland that continues to play a full part in the Kingdom and on equal terms.
Now that every other Party in Scotland is challenging that role, it is vital that we defend it.
Some people say that we're not a Scottish Party. But neither are we an English Party nor a Welsh Party nor an Irish Party. [end p26]
We are a Party of the whole United Kingdom. We are the Conservative and Unionist Party. And we will always be a Unionist Party.
I am delighted that at this conference you resoundingly rejected the prospect of a second class Scotland, cut-off from the rest of the United Kingdom by tax barriers that would destroy her economy.
For just stop to think for one moment how utterly inadequate and superficial the proposals for devolution from the opposition parties really are.
At least the Nationalists have the honesty to say that they want to break up the United Kingdom. Labour say they don't, but their policies say that they would.
They want to establish a Scottish Assembly—another layer of government—with the power to raise taxes. [end p27]
But why should companies want to invest in an area with higher taxes than the rest of the kingdom?
And how could Scottish MPs continue to vote on English matters at Westminster if English MPs were excluded from consideration of Scottish issues?
And who would foot the bill for the additional bureaucracy?
How could Scotland possibly benefit from losing influence and representation in Whitehall and Westminster?
As long as I am Leader of this Party, we shall defend the Union and reject legislative devolution unequivocally.
For in debate after debate we have endorsed a very different policy—a policy far bolder and more imaginative than that of our opponents.
Not devolution to politicians and bureaucrats—but devolution to the Scottish people themselves. [end p28]
Devolution of housing, devolution of education, devolution of share-ownership and devolution of state run industries to individuals.
It was a Unionist government which gave council tenants in Scotland the right to buy their own homes. And over 113,000 Scots have done so.
It was a Unionist Government which gave people the opportunity to choose to which school they send their children. And over 100,000 Scots have done so.
And it was a Unionist Government which gave people the opportunity to buy shares in British industry. And today twice as many Scots own shares than was the case in 1979.
This policy of devolution to the people continues with our policy of Scottish privatisation. Nationalisation took companies out of Scottish hands and into Whitehall; privatisation will hand them back to Scotland. [end p29]
It will create major new Scottish companies with vast assets, thousands of employees and a powerful presence in the Scottish economy—and give the Scottish public a new opportunity to acquire a major stake in the ownership of Scottish industry.
These are policies which give real power back to the people. Policies which the people support. The challenge for us now is to turn support for our policies into support for our party.
FOREIGN AFFAIRS
Mr. Chairman, this is a time of excitement and of hope in world affairs—and it gives Britain an unrivalled opportunity to use its traditional influence, now so much enhanced by our economic strength and the prestige we once again enjoy in the world. [end p30]
We see a great debate going on in the Soviet Union over the future course of Communism: a debate caused by the admission that after seventy years the Communist system has failed to deliver the standards of living and the quality of life which the free, democratic societies of the West enjoy.
We see the numbers of those permitted to leave the Soviet Union rising—not enough but better than it was. Now, one thousand years after Christianity first came to the Soviet Union, we hear it promised that Christians will at last be given full freedom of worship. We watch and pray that it will happen.
The same restlessness is abroad in Eastern Europe where people understand that the doctrine that the State provides everything and controls everything is bankrupt. [end p31] They want the prosperity which they see others enjoy in the West. They want the liberty which we have in the West. And they know these benefits can only be achieved by far-reaching reforms.
We must encourage these stirrings of reform—not in the sense of interfering in the affairs of these countries: We would find that just as unacceptable as they would—but by declaring where we stand. —We stand for greater contacts between people in East and West; —for greater human rights; —for societies in which the individual can improve his own condition and that of his family by his own efforts.
We cannot yet say with confidence what the outcome of this debate will be. We hope it will lead to societies which are more free and more just. [end p32]
But the spectre of repression has not yet been finally banished. The military might of the Soviet Union remains formidable and far beyond what it requires for defensive purposes alone—indeed it is that military might not its economic or political weight, which makes it a world power. We must therefore keep our own defences strong and up to date knowing that whatever happens our defence is sure. That way we can welcome with confidence the changes which we see happening in the Soviet Union. They offer greater hope for the future than we have seen for many years.
On Sunday we shall see the first Soviet soldiers begin their withdrawal from Afghanistan. They are leaving because the Afghan people fought for their liberty with the [end p33] support of their friends including the United Kingdom, and because almost the whole world united in condemning the Soviet military occupation.
And now we are on the verge of further progress here in Europe.
By 1992 the European countries are committed to remove all the artificial barriers which hamper economic growth.
That will give our firms a domestic market not just of 55 million people but of 320 million people.
And by 1993 we shall have the Channel Tunnel—a project which you could say started in Scotland for the machinery to bore the tunnel was made at Alexander Howden in Glasgow. Indeed orders for the equipment and material have already brought Scotland over £40 million pounds.
Thanks to Conservative policies, Britain is now well placed to take advantage of that huge European market. [end p34]
But the greatest advantage of all is that we now have a climate in this Britain in which business wants to succeed, can succeed and is succeeding.
We are now in a position to lead Europe into the next century.
Mr. President, I have come here to encourage you to assert our Party's place in the centre of Scotland's national life.
I won't be discouraged by temporary set-backs. I didn't come into politics to take short-cuts, or court easy popularity. My principles are not at the mercy of the opinion polls—neither, I am sure, are yours.
Only the practical application of Tory principles has made the recovery of the Scottish economy possible.
As Scotland regains its self-confidence, as more Scots realise that they have every right to be proud of Scotland's economic recovery, so our fortunes will revive. [end p35]
Tory values are in tune with everything that is finest in the Scottish character and with the proudest moments in Scottish history. Scottish values are Tory values—and vice versa.
The values of hard work, self-reliance, thrift, enterprise—the relishing of challenges, the seizing of opportunities. That's what the Tory Party stands for—that's what Scotland stands for. And that will be our message to the people.