Below is the text of the speech made by the then Prime Minister, John Major, to the Institute of Directors on 28th April 1992 at the Royal Albert Hall in London.
Mr President, Your Royal Highness, Your Excellencies, My Lords, My Lord Mayor of Westminster, Ladies and Gentlemen, I am delighted to be able to be with this Institute so soon after the General Election. It was an historic election. One that has rekindled confidence, and swept away the uncertainty that was holding back recovery.
If we are to build a better future, then there is only one sure way it can be done. That way is by policies that promote the strength of industry and commerce and the principles of the free market. Experience has shown repeatedly that high tax, high inflation, trade union run, interventionist, and bureaucratic policies are not the way to achieve success. Our job in the years ahead is to persuade more and more people to listen to the truth. If we can remove that pendulum of uncertainty that all too often effects business prospects ahead of general elections, then we will have taken a mighty stride to continuing prosperity.
Few voices have been more persuasive in pressing the case for free market ideas than this Institute. I am glad to be here today to thank you for the past you have played in winning the battle of ideas. Neither the red rose nor the prawn cocktail ever swayed your judgement.
You stood firm for what you believed. So did we. I hope we will now go on working together in order to root the values of enterprise, choice, ownership, and opportunity even deeper into the bedrock of Britain. They are the values in which we all believe. We dare not take them for granted and we must never cease to fight for them.
Throughout the election campaign I believed that recovery was waiting in the wings once confidence was restored. Some may have thought that this was the fanciful kind of thing that people say in the heat of an election campaign. Such things have been known. But I never doubted it. And the world clearly thought that recovery had started on Thursday night – the markets stayed open, and every one of them passed that judgement. In the light of the election result – and the response to it – I am more confident than ever that recovery is underway. We need a recovery that is steady and sustainable, not one that recreates the problems from which we are now emerging.
Inflation has been going down – down below German levels for the first time since before man walked on the moon. And since April 9th, progress has continued. The pound going up. Tax cuts soon to come through again under a Conservative Chancellor. And let me say, I believe that Norman Lamont has done an outstanding job for Britain, not only in his latest Budget, but over the last difficult year and a half. Never taking the easy road – but always the right one. And rarely getting the credit for it.
And those tax cuts will be deliberately targeted on those on more modest incomes. Not – dare I say it – on Directors but on people in modestly paid jobs: they might be young people starting out in life, part-time workers, many of them women, or disabled people who often command only modest incomes. But they will all benefit from having more money to spend as they think fit. And business will benefit too as their employees face less punitive taxation.
Last month, the rise in unemployment was the smallest for nearly two years. Of course, we should not read too much into one month’s figures, but this is a hopeful sign and as recovery develops we can look forward to the figures steadying and then once again coming down.
Certainly I now expect retail sales to move ahead. Business confidence is seen to be growing in survey after survey. Those are the sure signs of recovery. And as spring advances so will confidence.
I do not pretend for a moment that the last years have been easy. Recession never is. I know the toll it has taken on businesses and on individuals. That is why I have been so keen to put in place economic management that minimises the risk of such a recession occurring again.
But the problems should not blind us to the underlying changes which have taken place in Britain over the last decade. Or to the reasons why we have held firm over the last few months and years. Britain has changed immeasurably for the better. And we took the action we did – because we want a strong Britain, one that continues to grow in what will be the most competitive decade we have ever seen.
In every part of Britain there remains a new spirit of enterprise. The small business sector is alive and growing. Management and workforce in our larger firms working as one to take on the competition and win. More workers having a direct stake in their companies – and I want to see a great deal more of share ownership like that. It has played an important part in improving industrial relations and in spreading wealth far more widely among our workforce.
I see quality, design, and service once more at the forefront. ‘Made in Britain’ is again a badge of pride. I see British companies pushing forward the frontiers of innovation – in pharmaceuticals, electronics, telecommunications, indeed right across manufacturing industry. I see how productivity in Britain has risen by leaps and bounds.
Last year the number of days lost to strikes was the lowest ever. Why? Because we changed industrial relations and changed industrial attitudes. The British disease? We can forget all that now. We cured it. And now half the world is queuing up for a dose of British medicine. That’s good for Britain. Good for our name. Good for our exports. Good for investment. Good for jobs.
The British people did not want to see trade union power restored. That was one more reason why they supported us. People now look to us, as I know British industry does, to complete the work of trade union reform – and I promise you we will.
We intend to introduce legislation shortly, as we said we would in our Manifesto. We will make automatic deduction of union membership dues without written authorisation unlawful. We will take measures to give individuals greater freedom in choosing a union. We will require all pre-strike ballots to be postal and subject to independent scrutiny, and that at least seven days’ notice of a strike is given after a ballot. And, as we promised in the Citizen’s Charter White Paper, we will give every person who uses public services the right to restrain the disruption of those services by unlawful industrial action. Never again should the hard-pressed consumer be held to ransom by illegal strikes of this kind.
People also look to us to hold at bay that damaging social chapter in Europe that our opponents were jostling to sign. That, too, I promise you we will do. I believe strongly in deregulation, in getting government off the back of business. I want it to be understood throughout the Community that unnecessary interference with working practices is bad for business. I trust that that message will not be lost when the European Social Affairs Council reaches its conclusions on the Working Time Directive. It does not help the standing of the community when certain matters relating to employment are brought forward on the questionable basis that they are something to do with health and safety. I am not prepared to wave through plans that would add some five billion to the costs of British industry. Our European partners are keen to change existing legislation and place limits on shift patterns, prohibit working for more than 48 hours a week and sharply restrict Sunday working. They have a different structure of employment in their countries. These measures in the proposed Working Time Directive would hurt British industry and destroy jobs. They are not for us. No-one should be in any doubt. A Conservative Government will strongly oppose such damaging regulation wherever it is found and we will not readily acquiesce in any attempts to impose these costs on our industry.
In the last thirteen years Government policies have made Britain a magnet for overseas investment. By 1990 we had received 40 per cent of Japanese investment in the European Community, five times as much as in Germany or in France. Much of that investment has been in British manufacturing industry, using our manufacturing skills. It is high time people stopped writing down our skills and damaging British manufacturing industry.
It is true that some older industries have contracted, though in the process some, like steel for instance, have turned from industrial albatrosses into world leaders. But other industries have forged ahead. The output of the chemicals industry rose by 40 per cent in a decade: and that of plastics processing has nearly doubled in real terms. The UK is now the world’s third largest exporter of pharmaceuticals, and the information technology industry is thriving. Nearly one in ten of all the world’s personal computers are now made in Scotland.
It is scarcely surprising that our share in world trade in manufactures is growing. Manufacturing productivity between 1980 and 1990 grew faster than in any other large industrial country – our best performance in any decade since the war. We should talk this record up, not talk it down. We should tell people that our manufacturing exports are reaching new records. Exports are up by three quarters on levels of a decade ago. We are now even a net exporter of television sets. And the British motor industry is becoming feared abroad for its export challenge, not jeered at, as it once so humiliatingly was, for strikes, poor quality and late delivery.
That is the measure of the British achievement. And the members of this Institute have played a huge part in bringing it about. I see enormous international opportunities for us in the 1990s. And I want us to take them. Not just as leaders in defence and foreign affairs, but as increasingly powerful competitors in the international market place. Britain is ready to move forward, just when some of our main rivals are running into difficulties, or sliding back. These are opportunities that we must take. I am determined that we will take them.
I believe the 1990s should usher in a new era for prosperity and for jobs in Britain. Things that they said could not be achieved together are now in prospect together. They will be our targets in the 1990s – stable prices, sustained industrial peace, free enterprise given the chance to compete and to win, lasting growth without the scourge of inflation.
Our fourth Election victory has cemented the foundations for that success. It has opened up further opportunities. It has enabled business to invest with confidence and create the growing wealth our country needs.
The completion of the single market in Europe is essential to that. That will be the number one on our list of priorities when we assume the Presidency of the Community in July.
I make no secret of my view that we want a Europe that is a community of nation states. I do not want a United States of Europe. Such a concept could never be in the interests of the British people. Nor should responsibility be given to the Community when it can better be discharged at national or local level. That is a principle that I fought for at Maastricht. The principle of subsidiarity. You can take it from me that it is a principle to which this Government will hold fast. And to which it will hold Europe fast.
And you can also be assured of this. The Single Market in Europe must be a genuine free market, right across the Community. Yes, where necessary, there must be common rules. That is essential. But rules, once agreed, must also be obeyed. Some of our partners have been keener on making new rules than keeping them. That is why at Maastricht we pressed successfully for new ways of making those who drag their feet come into line. For the first time, the European Court will have powers to impose finds on member states which do not comply with the rules. I am not prepared to see British business put at a disadvantage in countries that fail to meet their Community obligations. As a result of Maastricht, they will not be.
Let me also add this. For it is fundamental to my belief about the future of the Community. The borders of Europe do not stop in the centre of our continent. We must not replace the iron curtain that has been torn down with a new regulatory net.
In my view we have a truly historic decade before us. Who in this room really thought that they would love to see an end to communism? That they would watch on television the miracle of 400 million people being set free at last? Well, in 1992 we are seeing the birth of a new world. It is every bit as remarkable as that discovery of another New World five centuries ago in 1492. This new world will be based on our free market principles of enterprise, ownership, democracy and choice. We must go out there and work to make it secure. The world has made its choice between socialists and free markets. And it has chosen free markets.
Already many of you are reaching out to these newly free nations of the East – to Hungary, to Poland, to Czechoslovakia, to Russia itself. As you do that, so must the Governments of the West. We must not, in our European Community, look in on ourselves. We must take the historic opportunity that has been offered to us. I want Britain to lead the way to a wider, more open and outward looking Europe. One which brings into the fold, as and when they are ready, not just the old neutral states of central and northern Europe, but the emerging democracies of the East. That is what we are going to be pushing for with the Presidency and beyond. What we must say to them is: when you’re ready to join the Community, we’re ready to accept you.
And not just for economic reasons. The greatest prize we could leave to the next generation would be to spread to the nations of the east that gift of security and peace which has been the greatest benefit of the European Community. Never again must Europe be the cradle of world conflict. A wider Europe of nations working in partnership, reaching to and embracing Russia itself – that is our goal. That would be a better and a safer Europe. We may not see it in our political lifetime. But that is what I will be working for. And one day, I am certain, it will be achieved.
Ladies and gentlemen, there are great challenges ahead for the Government and for industry. And also great opportunities. We must be determined to meet those challenges and take those opportunities. I promise you that the Government will be strong in pursuit of all that is in your interest and in that of all our nation.
To do that we must be sure in our values. Sure in our policies. Sure in our faith in the quality of Britain and in its people. Our policy will be to trust the people. To give them choice. To give them opportunity. And to give them ownership.
I have no doubt that the people of this country want a low tax, low inflation Britain in which success is possible and ambition rewarded. They want a Britain which recognises indisputably at last that free enterprise – not state intervention and socialism – is the route to national health and personal prosperity.
That was the golden discovery of the 1980s – proof, here in Britain, that more private wealth means more public wealth too. We cut income tax. But we still created the wealth to spend far more and to far better effect on our National Health Service and on pupils in our schools.
Private wealth and public welfare growing together hand in hand – it was the secret for which generations had looked in vain. Now in the 1990s, I promise you, we will go on with the policies that have been so successful. “Time for a change”, some said. Yes, but not the changes they had in mind.
Our objective is a country in which everyone – everyone – feels they belong. Where they can own homes, own savings, and own shares in their industries – and then pass them on to the next generation. Where every child leaves school well prepared for the changing world that lies ahead. Where more young people go into higher education and can choose the training they need. Where everyone feels they have a growing stake in the future of the United Kingdom.
It is free enterprise that will create the ideas, the jobs, the wealth, the public services that will make all this possible. Free enterprise. Your enterprise.
Recovery is now under way. Our job is to build it. To make it secure and to make it grow. And that, I promise you, we will seek to do.