HC Deb 28 October 1980 vol 991 cc197-203
Q1. Mr. Winnick

asked the Prime Minister if she will list her official engagements for 28 October.

The Prime Minister (Mrs. Margaret Thatcher)

This morning I welcomed President Masire of Botswana and held meetings with ministerial colleagues and others. In addition to my duties in this House, I shall be having talks with President Masire later this afternoon, and this evening I shall preside at a dinner in his honour.

Mr. Winnick

Is the right hon. Lady aware that the present level of unemployment, redundancies and closures is a grave indictment of her Administration, and that she has betrayed the high office that she holds? Is she further aware that if the Cabinet agrees to further cuts it will deepen the recession and force even more of our fellow citizens to rot on the dole queue?

The Prime Minister

With regard to the main part of the hon. Gentleman's question about cuts, what the Government are trying to do is to hold to the public expenditure totals that were published for this year and next. The private sector has to keep within its own budget and, indeed, sometimes has to cut costs. The Government are trying to keep within their pre-announced totals. We should and must do that if there is to be room within the private sector for the necessary measures that it needs to take. It is wrong to say that cuts in public expenditure will lead to further unemployment. If we leave more and more burdens to fall on the private sector, that is where the unemployment will arise.

Mr. Best

Will my right hon. Friend today alert the electorate to the despicable resolution that was passed at the recent Labour Party conference, which indicated that council house tenants who have been given the right to buy their homes will not be able to resell them at market value? Will she further alert the electorate to the fact that the resolution was described by a Labour Privy Councillor as being an incentive for people to vote Tory at the next election?

The Prime Minister

I firmly believe in the latter point that my hon. Friend makes—that people cannot sign away their statutory right to purchase their council houses if they have been council tenants. I hope that they will take my hon. Friend's advice and keep a Tory Government in office, so that they can keep their new property.

Mr. Foot

We shall debate the Government's appalling unemployment record tomorrow. The right hon. Lady referred to "holding public expenditure". In view of the answers that have been given this afternoon, will she tell us which side she takes on the issue of public expenditure on defence? Is she on the side of the Secretary of State for Defence or on that of the Chief Secretary, or does she think that this correspondence should now cease?

The Prime Minister

I hope that the right hon. Gentleman will understand that defence matters, and matters concerning any other sphere of government, cannot be carried on other than on a basis of confidence and trust. Matters that are confidential should be kept confidential. My right hon. Friend the Secretary of State earlier replied to certain questions about defence expenditure. The cash limit for this year's defence expenditure has been increased by about £250 million from the Contingency Reserve.

Mr. Foot

Will the right hon. Lady now be good enough to tell us whether she agrees with the Chief Secretary's letter?

The Prime Minister

I do not intend to take lectures on defence from the right hon. Gentleman.

Mr. David Steel

Does the right hon. Lady recognise the distinction made by the chairman of ICI between a bracing climate and freezing to death? If she does not, will she at least listen to the experienced voices of her own Back Benchers, who are calling for a cut in interest rates in order to increase industrial activity and employment?

The Prime Minister

I am the first person to want a cut in interest rates when such a cut is possible. As the right hon. Gentleman observed, interest rates in the market were well above minimum lending rate last week. We cannot bring down interest rates while the demand for loans by the Government and by companies together is as high as it is. I trust that we shall have the full support of the right hon. Gentleman as we try to reduce the amount of public borrowing, so that there is greater room for private sector borrowing at a lower interest rate.

Mr. George Gardiner

Will my right hon. Friend take this opportunity to endorse the judgment that was expressed last week by the Minister for Social Security, to the effect that if the Government had to apologise for anything—if—it was for cutting too little, too late? Will my right hon. Friend reassure the country that a critical review of public expenditure commitments will be undertaken, from which no Department will be exempt?

The Prime Minister

I agree that the public sector cannot go on withdrawing resources from the private sector. The private sector needs those resources if it is to remain in a healthy condition and expand. There must be a limit to the amount that the public sector can spend. However much one may want to spend more on particular projects, the money must be earned before we can spend it.

Q3. Mr. Canavan

asked the Prime Minister what are her official engagements for Tuesday 28 October.

The Prime Minister

I refer the hon. Gentleman to the reply which I gave earlier.

Mr. Canavan

Will the Prime Minister find time today to send a message of congratulation and encouragement to Mr. Walecsa, the leader of the Polish trade union movement, who effectively and democratically used trade union action to bring fundamental changes in Government policy as well as the sacking of Poland's Prime Minister? Will the Prime Minister encourage the trade union movement to do the same thing in this country?

The Prime Minister

I rather thought that this country had had free trade unions for generations, with privileges above those of other citizens.

Mr. Nicholas Winterton

Does my right hon. Friend agree that much of private industry in Britain is making a profit but is paying far too much of that profit—if not all of it—to the banks in the form of interest rates? Does she agree also that the private sector of manufacturing industry carries the brunt of the effect of the Government's policy? Will she look at what other countries, such as the Federal Republic of Germany, do to assist their industries when interest rates rise above a certain level? In that way we can ensure that there is some manufacturing base left when my right hon. Friend's overall policies—which I fully support—are successful.

The Prime Minister

The total demand for borrowing—partly by the public sector and partly by the private sector—keeps up interest rates. The Government can try to borrow less, and thus allow the interest rate to fall. When there is high public sector borrowing, there tends to be a high interest rate. If we can reduce public sector borrowing, there will be a lower interest rate. We must reduce the proportion that the Government take in public spending, in order to leave the greater part for the private sector.

Mr. Charles R. Morris

During her busy day, will the Prime Minister find time to reflect on the reply that she sent to me yesterday about the actions of the Conservative Board of Finance, which wrote a squalid fund-raising letter to 50 companies—including one in my constituency—merely because they were in receipt of Government grants? Will she make it clear to the Conservative Board of Finance that this type of letter, which was little more than an invitation to corruption, provoked a sense of revulsion in all parts of the House?

The Prime Minister

Perhaps the right hon. Gentleman will be kind enough to add that my reply to him pointed out at once that that letter should not have been sent. I said that at once, and the letter was withdrawn immediately.

Mr. Kilfedder

Is the Prime Minister aware of the righteous anger of reasonable Ulster people, who feel that the offer of civilian-type dress to prisoners in Northern Ireland is the first stage of capitulation to the evil murderers and men of violence in H-block, who have made a propaganda exercise of this issue? Will she commit the Government to offering civilian-type dress to all prisoners thoughout the United Kingdom?

The Prime Minister

As regards the first part of the hon. Gentleman's question, this matter was under consideration for some time. If a decision was to be made, it seemed right to make it before the hunger strike started. It would have been wrong to make a decision while the hunger strike was being carried on. The decision has been made and we shall stand by it. There will be no concessions to those on hunger strike—none at all.

As regards the latter part of the hon. Gentleman's question, he knows that there are a number of differences between the treatment of prisoners in Northern Ireland and those in the rest of the United Kingdom. One reason for that is that a much greater proportion of prisoners in Northern Ireland have received sentences of three years or more. A far smaller proportion of such prisoners exist in the rest of the United Kingdom. There are already some differences, and this will be a further difference.

Mr. Foot

Why does the right hon. Lady not appreciate that her reply to my right hon. Friend the Member for Manchester, Openshaw (Mr. Morris) was not satisfactory? Should she not have apologised for the fact that the letter was sent in the first place? Has she had time to discover how much money was raised for Conservative Party funds by this squalid method?

The Prime Minister

Nothing was raised as a result of that letter. because the matter was discovered the next day. Telephone calls were made immediately to those in receipt of the letter. An instruction was issued to the effect that the letters should be withdrawn immediately. I have given the right hon. Gentleman my views. The letter should never have been sent. Instructions were given to the effect that it should be withdrawn and returned immediately. Most of those letters have been returned.

Mr. Charles R. Morris

On a point of order, Mr. Speaker.

The Prime Minister

In any event, I do not answer for the Conservative Party.

Mr. Speaker

Order. I am sorry to interrupt the Prime Minister, but I think that the right hon. Member for Manchester, Openshaw (Mr. Morris) wishes to raise a point of order.

Mr. Morris

On a point of order, Mr. Speaker. Will the Prime Minister—

Mr. Speaker

Order. The delay will prevent my calling the next question.

Mr. Morris

On a point of order. Mr. Speaker. I do not wish to delay anybody but is it right for the Prime Minister to mislead the House?