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Prime Minister (Engagements)

Volume 982: debated on Tuesday 15 April 1980

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Q1.

asked the Prime Minister if she will list her official engagements for Tuesday 15 April.

This morning I had meetings with the Vice President of Ghana and with Sir John Mason, our High Commissioner designate at Canberra. In addition to my duties in this House, I shall be having further meetings with ministerial colleagues and others.

Will the Prime Minister take time today to reflect on the mounting evidence emerging this week—not only from her Chancellor of the Exchequer—that her economic strategy is destroying Britain's industrial base? [HON MEMBERS: "Reading."] Will she further consider a reversal of those policies which have led to a soaring inflation rate of 20 per cent., rising unemployment and crippling interest rates,—[HON. MEMBERS: "Reading."]—that will soon turn this country into a banana republic, both economically and diplomatically?

I note the hon. Gentleman's studied supplementary. It is ridiculous to say that Britain's industrial base is being destroyed. There are large areas of industry that are flourishing. As my right hon. Friend the Secretary of State for Trade pointed out recently, our export performance, apart from cars, is holding up extremely well. That is a great compliment to many of our industries.

Quite a number of our textiles also. Some of our textiles are in great demand.

I agree that the unemployment rate is high. Fortunately, it is not quite as high as the record levels reached under the previous Labour Government. I can only be frank with the hon. Gentleman. I believe that, unfortunately, the unemployment rate will rise. If we were to continue printing more money—which is what the hon. Gentleman wants—we should have not only higher inflation, but also higher unemployment.

Will my right hon. Friend take time today to read the reports in the press about the rate—[HON. MEMBERS: "Reading."]—bills that are circulating at present.

Will my right hon. Friend note that a house in Conservative-controlled Wandsworth has an annual rate bill of £233, whereas an identical house on the opposite side of the road, in Socialist-controlled Lambeth, has a rate bill of £376? Does she not think that there is a lesson there that people should learn before they vote in the local elections?

I thank my hon. Friend for pointing out that the lowest rate increases are occurring in Tory-controlled authorities, and that the highest rate increases are occurring in Labour-controlled authorities. That is happening all over the country. The position in Wandsworth and Lambeth is just one example, and many people are glad that they live on the Wandsworth side of the boundary.

The Prime Minister said that it is ridiculous to say that British industry is being undermined by her policies. Has she any record of any previous period in British manufacturing history when there has been a decline—and the Government anticipate a decline of 4½ per cent. in manufacturing output this year—further followed by three consecutive years of decline? In what way does she believe that that will strengthen British industry?

My point was that, on the whole, British industry is not going into perpetual decline, nor is the manufacturing base being perpetually eroded. There are certain problem areas, and the car industry is one of them.

There are enormous difficulties in some of the nationalised industries. They will not be sorted out until we have reduced the overmanning and concentrated on raising productivity. The right hon. Gentleman is as familiar with that as I am.

I am familiar with the fact that it is a long-standing problem and that it will not be cured by Tory gimmicks. However, why is the right hon. Lady accepting with such complacency the intention, which the Government have published, that British manufacturing industry should decline over four years? Will she answer my question? How can that possibly strengthen the base of British industry? How can it possibly help unemployment? How can it encourage British industry to invest and expand?

British industry will invest and expand by individual decisions by individual companies. As for macro-assessments—yes, we have deliberately been very cautious about the future. The right hon. Gentleman knows what happened when he made extremely optimistic assessments and based his public expenditure forecasts upon them. The assessments did not come about because the increases were not made. Unfortunately, he nevertheless spent the money and very soon had to have the IMF in.

Is the right hon. Lady aware that we totally disagree with the policy of cutting public expenditure at present? It is not only socially unjust but economically crippling.

I note that the right hon. Gentleman wishes to have either very much higher taxation, direct and indirect, or wishes us to print more money. I reject those solutions.

Will my right hon. Friend continue her efforts today, tomorrow and, if need be, the day after to get it into the thick skull of Sir Denis Follows that there is a war going on in Afghanistan? Will she make it clear to him that in the circumstances it would be a national disgrace if a British team were to go to compete in the so-called Olympics in Moscow with the Communists and their stooges?

I understand fully and agree with my hon. Friend's question. I understand that Sir Denis Follows said that only a war would change the decision of the British Olympic Association to go to Moscow. I agree with my hon. Friend that there is just such a war going on in Afghanistan. Russia is using troops to hold down a people. In those circumstances it will be wrong for British athletes to go to Moscow if they value their freedom as much as we do.

Will the right hon. Lady take time today to consider the anger of the teaching profession in Scotland over the instruction from Professor Clegg that it works out its own comparability study? Will she instruct her right hon. Friend the Secretary of State for Scotland to make an appointment immediately of a committee along the lines of the Lever committee on steel, to produce a result within seven days?

I think that there are mixed feelings on the report of the Clegg Commission. As the right hon. Gentleman is aware, the Clegg Commission was asked to consider pay in relation to terms and condition of service. It is clear from the face of the Clegg Commission's report that it had considerable difficulty in carrying out its task. Its findings must now be referred to the negotiating committees on pay and to different committees on conditions of service. Most people agree that teachers' professional obligations extend outside the classroom. It is extremely difficult to arrange pay unless we know exactly what terms and conditions of service we are paying for.

Q2.

asked the Prime Minister if she will list her official engagements for 15 April.

I refer the hon. Gentleman to the reply which I gave a few moments ago.

Will the right hon. Lady take an opportunity amid her duties, to explain why she and other Ministers continue to insist that the only way to reduce inflation is by reducing the money supply, when over the past five years Germany, Switzerland and Belgium have had rates of expansion of the money supply identical to ours and yet, while our rate of inflation has averaged 15 per cent. Switzerland's was 4 per cent. Germany's was 5 per cent. and Belgium's was 9 per cent.? Does not that indicate clearly that the Government's economic policy is based on a gigantic fallacy?

Of course it does not. The hon. Gentleman is well aware that there are time lags between money supply and it coming through. He will find a close correlation, if he looks at the time lag, between money supply and the rate of inflation. Apart from that it stands to commonsense that, if we print more money than is backed by goods and services, that extra money, if it is used, will find its way into increased prices over the course of time.

In an effort to assist the Leader of the Opposition and industry, will my right hon. Friend say anything to trade union leaders at British Leyland, whose dispute and subsequent strike is leading only to economic disruption in the industry? Does she agree that it will do nothing to assist the recovery of British Leyland and nothing for the workers but will merely play into the hands of those who wish to see economic ruin in Britain?

I am grateful to my hon. Friend. We hope that British Leyland will break through to being profitable and successful. We believe that in the past few months it has increased its share of the market and has a chance of doing a great deal better. We hope that that chance will not be thrown away by those who are at present on strike. We hope that they will assist all their fellow workers and the management to make British Leyland successful once again.

Will my right hon. Friend find time to ring Mr. Len Murray to suggest that his time would be better spent in getting together with Mr. Moss Evans and Mr. Duffy to sort out the ridiculous problem at British Leyland instead of spending time organising a day off on 14 May?

I hope that the problem at British Leyland will be sorted out. There is a chance there. I believe that the company has one of the best managers that any industry will ever have. I hope that the work force will back him and that it will go back to work and enable the cars to be sold once again.

Order. I shall call two hon. Members from the Opposition Benches to hold the balance.

The right hon. Lady is on about British industry. Does she accept that the Post Office is an extremely important part of British industry? Will she confirm that at 4 o'clock today the chairman of the Post Office will announce his resignation, to be replaced by a civil servant from the Department of Industry?

I think that the hon. Gentleman had better wait until 4 o'clock, if an announcement is to be made at that time.

Q3.

asked the Prime Minister what are her official engagements for 15 April.

Will the right hon. Lady take this opportunity of explaining in a little more detail exactly what she meant yesterday when she made the commitment to support United States policy in Iran? Was that support completely unqualified? Does it include, for instance, any move by the United States to employ military means to solve the problem?

With respect to the hon. Gentleman, I think that I spent just about half an hour answering questions in very considerable detail yesterday. I made the point as forcefully as I could that diplomatic activity had not succeeded in releasing the hostages and that the United States was entitled to expect to move on to the next stage—namely, political and economic activity. I made no reference to military activity—

except to say that that would be an extremely grave step. I believe that the United States was asking us to see what we could do by political and economic activity, and for that we would need the widest possible international support.

In view of my right hon. Friend's firm statement yesterday on Iran, will she undertake to stop the handing over of the recently completed naval supply vessel to the Government of Iran by Swan Hunter on the Tyne? It would be a rather odd time to hand it over right now.

As my hon. Friend knows, we have not exported any military equipment to Iran. That has been one of the points of agreement that we had with the United States Government. We are able to do that without legislation, because the requirement is either the commissioning of a naval vessel or an export licence. In this case it would require an export licence, so the Government are entitled to take action if an export licence is applied for.

In view of the right hon. Lady's earlier remarks that British industry is bearing up, is she able to assure the House that she is aware that the Chancellor of the Exchequer said only yesterday that industrial production will fall by 6 per cent. under her Government? Is she aware that if that happens she will leave behind industrial output that is even lower than that left behind by the right hon. Member for Sidcup (Mr. Heath) 10 years before, when we had three-day working? Is she content to go down in history as the Prime Minister who left British industry in a worse state than her right hon. Friend the Member for Sidcup?

As the hon. Gentleman knows, what happens in the next year will depend exactly on how hard and how efficiently people work. [Interruption.] Of course it will. If people back strikes, their output will go down, but if they take advantage of increased productivity and of previous investment in British industry and work with greater efficiency, we shall get a higher standard of living. That is the only way in which to get a higher standard of living in this country.

On a point of order, Mr. Speaker. During Question Time the Prime Minister appeared to mislead the House by suggesting that the textile industry was one of those industries with a balance of payments surplus—

Order. With every respect to the hon. Gentleman, the content of the Prime Minister's reply cannot be a point of order for me, because the Prime Minister takes responsibility for her own replies.

What I am concerned with, Mr. Speaker, is the conduct of the House, which is in your hands and is obviously outside the responsibility of the Prime Minister. The Prime Minister's suggestion, by misleading the House, has lowered the standard of conduct, which is in your hands.

The hon. Gentleman is well experienced. He knows that that is not a real point of order. There has been no breach of our Standing Orders in what has occurred. Whatever the hon. Gentleman's feelings, he should not pursue them with me at this moment, because there is nothing that I can do.

Further to the point of order, Mr. Speaker. Is there some remedy open to hon. Members if the Prime Minister misleads the House by suggesting that a particular industry is in surplus when it is in massive deficit?

Order. It is quite common in this House for hon. Members on each side to charge that someone on the other side has misled the House. It usually means that the hon. Member concerned disagrees with the contents of the reply.