THE PRIME MINISTER

Mrs. Margaret Thatcher, the Prime Minister, said:

We meet in the aftermath of a General Election. I think we can say that the result was not exactly a photo-finish. We are grateful for victory. We are grateful to you and the thousands of people in every part of the country who worked so hard to ensure success. We thank you all, and we do not forget today Cecil Parkinsonthe man who so brilliantly organised the campaign.

Last June we again won the honour to serve the British people. How best shall we do it? Not by being complacent about our majority, nor by assuming that our past achievements will automatically bring us future success. Our first four years were the preparation for further action. Further action there will be.

When we were first elected in May 1979, it was to tackle the real problems which others had shirked. We did tackle them. Anyone who understood those problems never expected them to be solved in the space of one Parliament. We have made a start and we shall see it through.

We were elected to bring inflation down. We brought it down. It was and still is a series of continuing battles which commands our unremitting effort. The pessimists told us it could not be done. They under-estimated three things: This Government, you, Sir Geoffrey HoweMr. President, and the British people. [end p1]

We were elected to reform the trade unions. With the support of millions of trade unionists, we have passed two major acts of Parliament. And what a lot we owe to Norman Tebbit. But there is a lot more to do, a great deal more, and you can rely on us to do it.

We were elected to extend home ownership, and we gave council tenants the right to buy their own homes. And never let it be forgotten that Labour fought it tooth and nail in their local councils, in Parliament and through the courts. It was not part of their philosophy that council tenants should acquire the rights and dignity of freeholders. It is because of Conservative conviction and persistence that nearly three quarters of a million more council tenants have either bought or are buying their homes, and with Ian Gow as Minister of Housing there will be many, many more.

We were elected to reduce direct taxation. We have reduced the rates of income tax, and we have raised the thresholds. But there are still too many people paying income tax and the burden is still too great. The fight for lower taxes will go on, and no one will fight harder to bring them down than our new Chancellor of the Exchequer, Nigel Lawson.

We were elected to strengthen the forces of law and order. Thanks to Willie Whitelaw there are now more policemen, better paid, better equipped, than ever before, and more of them back on the beat. But as you heard from Leon Brittan, this Government is reinforcing its efforts. But it is not just a case of “leave it to Leon” . Law and order is not just his problem—it involves every citizen in the land. None of us can opt out.

We were elected with a clear commitment to the European Community and to fight tenaciously for British interests within it. We have honoured that commitment, We have both fought for our interests and extended our influence. But we are not half-hearted members of the Community. We are in, and we are in to stay. And I look forward to another famous victory in the European elections next June. [end p2]

We were elected to secure the defence of the Realm. We have made clear through word and deed, to friend and foe alike, our resolve to keep Britain strong and free. No one doubts now that this country, under this Government, stands shoulder to shoulder with her allies to defend the cause of justice and freedom and to work together for peace. Under Michael Heseltine 's vigorous leadership we won the argument against one-sided nuclear disarmament.

That is the record we put before the British people at the General Election. They are the ultimate jury, and they found in our favour.

These things were achieved by strong Government, strong to do what only Governments can do. But a strong Government knows where to draw the line. It has the confidence to trust the people. And a free people know that the power of Government must be limited. That trust and that confidence are the hallmark of the Government which was re-elected on 9th June.

At that election, Socialism offered yesterday's policies for today's problems. Socialism was routed. The other day at Brighton they were given a respray, polished and offered once again to the people. But they are still yesterday's policies, and even yesterday they did not work.

Our people will never keep the Red Flag flying here. There is only one banner that Britain flies, the one that has kept flying for centuries—the red, white and blue.

One of the great debates of our time is about how much of your money should be spent by the State and how much you should keep to spend on your family. Let us never forget this fundamental truth: the State has no source of money other than money which people earn themselves. If the State wishes to spend more it can do so only by borrowing your savings or by taxing you more. It is no good thinking that someone else will pay—that “someone else” is you. There is no such thing as public money; there is only taxpayers' money. [end p3]

Prosperity will not come by inventing more and more lavish public expenditure programmes. You do not grow richer by ordering another cheque-book from the Bank. No nation ever grew more prosperous by taxing its citizens beyond their capacity to pay. We have a duty to make sure that every penny piece we raise in taxation is spent wisely and well. For it is our party which is dedicated to good housekeeping—indeed, I would not mind betting that if Mr. Gladstone were alive today he would apply to join the Conservative Party.

Protecting the taxpayer's purse, protecting the public services—these are our two great tasks, and their demands have to be reconciled. How very pleasant it would be, how very popular it would be, to say “spend more on this, expand more on that.” We all have our favourite causes—I know I do. But someone has to add up the figures. Every business has to do it, every housewife has to do it, every Government should do it, and this one will.

But throughout history clever men, some of them economists, not all of them rascals, a few of them vicious men, have tried to show that the principles of prudent finance do not really apply to this Government, this budget, that institution. Not so. They always do, and every sensible person knows it, no one better than you, Mr. President, who had to deal with countries which flouted those principles and are now up to their eyes in debt. Who do they turn to? Those who follow prudent principles like us.

When there is only so much money to spend, you have to make choices, and the same is true of Governments. It is sometimes suggested that Governments can opt out of these choices. They cannot. Let me for a moment take the subject which we have so much debated, the Health Service.

People talk about a “free” service. It is not free. You have to pay for it. Five years ago, just before I came into No. 10, a family of four was having to pay on average through various taxes some £560 a year for the Health Service; this year that same family will have to pay £1,140 a year, more than double. Let me put it another way. This year, the Health Service is costing over £15,000 million—half the total yield of income tax. [end p4]

The Health Service has one million employees. It is the largest employer in Europe. It really is our job to see that it is managed properly.

I pay tribute, as we all do, to those doctors, nurses and others who work so hard to keep up the standards of care. We are all grateful for the great advances in public health since the war: the continuing decline in child mortality, the virtual eradication of diseases like diptheria and tuberculosis, and the miraculous new techniques of surgery.

But every human institution can be improved. I reject totally the Socialist view that the most efficient organisation is the one that employs the largest number.

Now let me get one or two things through about that budget. Let me put the facts on record just a little bit more. The Health Service budget is very large. We are not cutting it. We are keeping to the plans we announced before the election, and which I repeated as a pledge during the election. I will say it again. We are spending £700 million more on health this year alone, another £800 million next year, and a further £700 million the year after that. That is the pledge I made and that is the pledge that will be kept. [end p5] And we have to keep within that huge budget. That is what good management means and that is what we are doing, as Norman Fowler explained in his outstanding speech yesterday morning.

Of course our opponents could never begin to match our record, once again trying to pin on us all the adjectives in the dictionary of denigration—harsh, uncaring, uncompassionate and the rest. I am told that the new leader of Her Majesty's Opposition, and long may he hold that office, went so far as to say at Brighton last week that I was engaged in “terminating the health service.”

Mr. President, let me tell you how you really terminate the health service. You do it by pretending there are no hard choices. You do it by behaving as though Britain has a bottomless purse. You do it be promising what you cannot deliver, by assuming that all you need to do is to snap your fingers, cry “abracadabra” and to and behold, the sky's the limit. But the sky is not the limit, for this or any other Government, or indeed for any other country, and to imply that it is or ever can be is sheer humbug and a fraud on the people.

Our opponents would spend, spend and spend before they had even filled in the coupon, let alone win the pools. At this Conference last year you remember that I said the National Health Service is safe with us. I will go further. The National Health Service is safe only with us, because only this Government will see that it is prudently managed and financed and that care is concentrated on the patient rather than on the bureaucrat. That is the true and the genuine caring. When our opponents start demanding more spending on hospitals, schools, roads or for the old folk, I do not hear them at the same time calling for more income tax, or an extra 5 per cent. on VAT or even more on local authority rates.

In facing up to this problem of controlling public expenditure we in Britain are far from alone. Let me give you one or two examples of what is happening in other countries. In Socialist France they have introduced boarding charges for hospital patients. The French and the West Germans have delayed pension increases and are cutting unemployment benefit. In Holland they are cutting social security benefits and the pay of the public service by 3½ per cent. In Belgium and Denmark they have de-indexed social security benefits. Think what people would say in this country had we done some of those things.

I do not say that these measures are the ones we should follow but I do say that no Government, whatever its political complexion, can suspend the laws of arithmetic or run away from reality. [end p6]

There is something else we share with other nations. The World recession has brought high unemployment to almost every country. In such times people understandably ask where will the new jobs come from. There is always a temptation to believe that the dynamism of the past will be exhausted and that the best we can hope for is to share out the work we have already got. Nothing could be more mistaken. That is not how our fathers and grandfathers transformed the standard of living in the western world. They did not wait for the boost or scan the horizon for the upturn. They were the upturn and they provided the boost themselves.

If Britain had stayed as it was in 1900, millions of people in this country would still be working in agriculture and domestic service would still be at 1900 levels. If people had known then that by 1983 less than 3 per cent. of the population would be in agriculture and only a tiny fraction in domestic service, they would surely have asked, “Where will the other millions find jobs?” Who could have foretold then that what people would want today and what they would buy today? Who could have foretold then what inventiveness would produce decades hence? While some machines that were invented replaced unskilled work others created new goods undreamed of—motor cars, kitchen equipment, new fabrics, films—and these created, these new machines, thousands of jobs.

But as new industries sprang into being the old ones declined, causing unhappiness and hardship. We did not then have the means or the organisation to temper the winds of change—the cash benefits, the retraining schemes, the redundancy benefits—that we have now. Tories have long been prominent in creating those schemes and benefits.

Again and again Tory Governments took the lead; in extending unemployment insurance, in providing compensation for past industrial injury and disease and in bringing in training schemes for the future.

In the declining industries we have made available compensation on a uniquely generous scale for those who have had to lose their jobs. Let no one accuse this party or this Government of failing to care about the unemployed. This Government has also taken two very far-reaching steps to see that Britain is never again left unprepared for technological change.

Our youth training scheme is the most imaginative in the western world and when it is well under way every 16-year-old will have the choice either to stay on at school or to find a job or to receive training. At that age, unemployment should not be an option. That is our objective. [end p7]

We are responding to the needs of industry by reintroducing technical training into our schools—and not a moment too soon.

This Government is building for the future. We all want a higher standard of living, as individuals and as a community. The same is true in other countries. The challenge we face is not one of sharing out the limited amount of work—like spreading butter thinly on a slice of bread. It is how to translate our wants and aspirations into work to be done by our people. It is by producing what people want to buy that unemployment will be solved.

The same drive and inventiveness that created the great industries of the past and brought prosperity to our people are still at work today. New industries are still being born. New products are still coming onto the market. New services are still developing.

Only last month I opened the largest oil production platform in the North Sea. Fifteen years ago the oil and gas industry, the offshore industry, employed only a handful of people. Today it employes more than 100,000. Who, 10 or 20 years ago, could have foretold that so many homes would have video recorders, which we are just beginning to produce here, music centres, home computers and pocket calculators? Who would have foreseen the revolution in office equipment and information technology? These may be called light industries but they produce tens of thousands of solid new jobs.

In service industries too, the past 10 years has seen some of the most rapid increases in jobs. Let me give you a few examples because I know you are still wondering where the new jobs are going to come from and I am trying to show you they have come from new machinery and new technology in the past and that is still happening today. Let us have a look at the new service industries and see what has happened recently.

Over 300,000 more jobs have been created in insurance, banking and finance than there were 10 years ago. There are over 600,000 more jobs in the scientific and professional services, over 200,000 more jobs in hotels and catering and nearly 60,000 more jobs in sport and other recreations. All of those are service jobs, for skilled and unskilled workers alike. So, as we have redundancies in the declining industries we are getting new jobs in the new industries, new jobs in some of the older industries that are modernising themselves, and new jobs in some of the service industries. They are being created by our dynamic economy of today.

Let us not belittle our achievements. There must be quite a lot right about a country that can sell 30 per cent. of its output in the teeth of fierce competition. [end p8]

And this is a country that can still export £1,000 million worth of goods every week, without counting oil. Which is the second biggest exporter of services in the world, second to the United States? It is Britain. So let us send our warm thanks and congratulations to all of those whose splendid achievements are bearing such fruit.

But, although it is a marvellous record, we have to remember something else. Our competitors are improving all the time and some of them started well ahead of us. So we must improve even faster than they do if we are to catch up. It is no good just beating our previous best; we have to beat our competitors. That means that our Government must not put a heavier burden on our industry than other Governments place on theirs.

What does that mean? I will tell you. It means we must stick to the policies that get inflation and interest rates down, which keep business taxes down, and local rates down, policies that cut through the thicket of restrictions and policies that will reduce the time taken for planning permission. It is important that we continue with each and every one.

If Atlas carries the world on his shoulders, we need a good, strong Atlas and not too heavy a world.

Our job in Government is to provide the right framework in which enterprise can flourish and we are doing it. But, of course, it rests with the people themselves to pick up the challenge and it is in the people that we Conservatives place our trust.

The great surges of progress and prosperity in this country did not come directly from Government action. They were not based on national plans. They came from free men, working in a free society, where they could deploy their talents to their best advantage for themselves, for their countries and for the future. That is our policy. It has worked in the past and it will work again. It is to achieve a new prosperity and the new jobs for our people in the future.

The first duty of Government is to make our future and our way of life secure. In the election campaign it became clear that the overwhelming majority of our people were determined to see that our country was properly defended. They recognised that Britain's possession of nuclear weapons has helped to prevent not only nuclear war, but conventional war too. Those of our opponents who said the opposite hastily had to pretend that they did not really mean what they said. [end p9]

Those of our friends overseas, who might have doubted the resolve of the British people were reassured by our victory. To retain peace with freedom and justice we must maintain the unity of Nato. Most of our people would never vote for a party that undermines Nato and snipes at our allies. [end p10]

The so-called peace movement may claim to be campaigning for peace, but it is NATO and the Western Alliance which have been delivering peace in Europe for more than 30 years. Peace does not come by chanting the word like some mystical incantation. It comes from that ceaseless vigilance which the Western Allies have sustained for nearly two generations. Peace is hard work, and we must not allow people to forget it.

The Soviet challenge remains. To say that is not to welcome the fact and still less to take pleasure in it. But if we are properly to defend ourselves, we must first make a realistic assessment of the threat we face. No one can wish away the post-war history of the Soviet use of force nor wipe out the grim calendar of Soviet suppression of freedom. You know the calendar almost as well as I do: 1953 East Germany, 1956 Hungary, 1961 the Berlin Wall, 1968 Czechoslovakia, 1979 Afghanistan, 1981 Poland, 1983 the South Korean civil airliner.

The Soviet Union is unlikely to change much or quickly. Internal difficulties will not necessarily soften its attitudes. Nor should we overestimate the influence of the West on that vast, suspicious country. Its leaders are likely to remain distrustful and hostile to the West and ruthless in their international deeds. Economically, of course, you may say, we have nothing to fear. Whatever the difficulties, economies that flourish do so under the banner of the market and not of Marx.

In the battle of ideas, the Soviet Union are in retreat as more and more peoples in Africa and Asia discover what Europe has already discovered—the cruel emptiness of Marxism. And, you know, the Russian leaders know this. Why else do they prevent their people from travelling freely? Why else do they jam Western broadcasts? Why else do they look away those of their fellow citizens who have the temerity to ask that the Soviet Union should abide by its undertakings at Helsinki?

But whatever we think of the Soviet Union, Soviet Communism cannot be disinvented. We have to live together on the same planet and that is why, when the circumstances are right, we must be ready to talk to the Soviet leadership. [end p11] That is why we should grasp every genuine opportunity for dialogue and keep that dialogue going in the interests of East and West alike. But such exchanges must be hard headed. We do not want the word “dialogue” to become suspect in the way the word “detente” now is. And a major element in that dialogue must be arms control. Indeed, we in the Western world would like to have arms reduction, provided always that the balance is kept and the undertakings to reduce or destroy weapons can be verified. Arms reduction in those circumstances, on those grounds; that is our aim.

I think it is important that we understand exactly what kind of negotiations are going on in Geneva. We are negotiating about two classes of nuclear weapons—the intermediate weapons and also the long-range strategic missiles. Two sets of negotiations.

Let me talk about the intermediate weapons first. Some six years ago, the Soviet Union began to replace hers by the more accurate SS20s which have three times as many warheads. We had nothing comparable, so NATO in 1979 decided to modernise our intermediate weapons with Cruise and Pershing II missiles in order to restore the balance. But at the same time we tried to persuade the Soviet Union to reduce the number of SS20s. There was no response.

Then we offered to eliminate our missiles if they would eliminate theirs. If they agreed, no Cruise or Pershing II missiles would be deployed. That is President Reagan 's zero option. Still there has been no positive response from the Soviet Union and all the signs are that there will not be. In that case, the first Cruise and Pershing II missiles will be deployed at the end of this year.

Nevertheless, in Geneva we shall persist in our efforts for an agreement to keep the numbers as low as possible on both sides. No weapons would be better than some, but few would be better than more.

Meanwhile, the whole situation has been deliberately clouded and confused by the Soviet propaganda attempt to suggest that our strategic weapon, Polaris, should be included in the intermediate weapon talks. Now, Polaris is our last resort deterrent. We had it long before the SS20s and then, and now, we need it in case we should ever be threatened by [end p12] Russia's great arsenal of strategic weapons. And however you measure it, our strategic force amounts to only 2½ per cent. of theirs; 40 of theirs to every one of ours.

But there are separate talks in Geneva concerning strategic weapons. The Soviet Union and the United States have some 9,000 warheads each. In 1981, President Reagan suggested that as a first step the missile warheads should be cut on both sides by one third. Once again, there has been no positive response from the Soviet Union. But if ever this enormous strategic armoury were drastically reduced, then, of course, we should wish to consider how we in Britain could contribute to the arms control process.

As you personally know, Mr. President, the West has made proposal after proposal for arms reduction and the day the leaders of the Soviet Union genuinely decide that they want, through arms control agreements, to make this a safer world, they will be pushing at an open door. Until then, our threefold policy will be the same—realistically to assess the potential aggressor, firmly to maintain our capacity to defend and deter and always to stand ready to talk.

As I am sure you will understand, there is no one more anxious for genuine disarmament than the person who bears the ultimate responsibility for the nuclear deterrent in our own country. I wanted to say that to you. You will understand how important it is to me that we try to make these arms reduction talks succeed.

We won a great election victory on 9 June and there is no reason on earth why we should not take pleasure in that alone, but I really believe that we have done more than that. The election showed that something remarkable has happened in this country—and our opponents were just as aware of it as those millions of people who supported us. What I think we discovered and expressed, both in our four years of Government and in the programme which grew out of these four years, was where the heart of the British people lies. [end p13]

We are a mature nation which, through centuries of trial, sorrow and achievement, has developed a common view of life. There are things for which we as a people have stood for centuries—the will and capacity to defend our way of life, the rule of law, the belief in private property and home ownership, the protection of the elderly and the sick, the limitation of Government and the freedom of the individual. And by giving voice to these convictions in 1979, by holding fast to them for four years, by having them reaffirmed in 1983, I believe we have altered the whole course of British politics for at least a generation. We have created the new common ground, and that is why our opponents have been forced to shift their ground. Both the policy and direction of State Socialism on which they have been fighting for years have been utterly rejected by our people. State Socialism is not in the character of the British people. It has no place in our traditions. It has no hold on our hearts.

A Socialist party can only hope to survive in Britain by pretending that it is something else. We are told the Labour party is reassessing its attitude to home ownership and is thinking again about Europe. We are told the Social Democrats now see the virtues of capitalism, competition and the customer. We have entered a new era. The Conservative party has staked out the common ground and the other parties are tiptoeing on to it.

The Conservative party has a greater responsibility than ever before. Now, more than ever, we draw our support from all sections of the nation. It is our pride and our purpose to strive always to be a national party—a party which speaks for and to the whole nation.

In 1975, standing where I am standing today, I said that I had a vision for Britain—a Britain strong in the defence of peace and justice, a Britain strong in support of personal freedom, a Government strong enough to protect the weak, but a Government with the strength to allow people to lead their own lives. [end p14]

Visions do not become a reality overnight, or even in four years. They have to be worked for, consistently, unswervingly. We have set a true course—a course that is right for the character of Britain, right for the people of Britain and right for the future of Britain. To that course we shall hold fast. We shall see it through—to success.