................................................................................ ON THE RECORD JOHN PRESCOTT INTERVIEW RECORDED FROM TRANSMISSION BBC-1 DATE: 3.5.98 ................................................................................ JOHN HUMPHRYS: But first, where does the Labour Party go from here? The government has enjoyed the most extraordinary anniversary - the commentators have been competing with each other to find the most flattering superlatives - but where now? Can it continue? Of course there are lots of very difficult decisions ahead. The government says it is prepared to face the hard choices. But is it? The Deputy Prime Minister John Prescott is in our Hull studio. Good afternoon Mr Prescott. JOHN PRESCOTT: Good afternoon. HUMPHRYS: You're doing very well, nobody could argue about that. Your position is really quite extraordinary. But - you haven't yet made many of the really big, hard, choices, have you? PRESCOTT: Well I think we have. We've started to make the reform in the Welfare System, it's going to be a difficult period for us of course. We have to explain it within the principles of our own policies and we'll begin to do that. We've begun to make the choices in resource allocations by picking out the priorities for education, health - they're two of them. Modernising government is controversial of course and the great constitutional changes that we've been making for Scotland and Wales and modernising local government. Now these aren't, not easy decisions and they're ones that we've been making. We're doing what I think is getting the footings in, you know, so that we can deal with government in the coming years. HUMPHRYS: Getting the footings in, may be, but building the buildings is going to be the real problem, isn't it. One that you didn't mention there- PRESCOTT: Well they fall down if the footings aren't too good, John. HUMPHRYS: Absolutely, you've got to decide what those footings are, first of all though, that's the problem and my suggestion to you is going to be that perhaps you haven't made those decisions yet. Let's deal first of all with one that you didn't mention there and that's Europe. And the Euro, the Single- PRESCOTT: I think there were a couple I didn't mention John, and I accept that Europe is certainly one of them. HUMPHRYS: Fine. The problem here is that what you could have done is you could have said: we are a massively popular government, it appears that the people trust us, now we could have gone to them and said,
using that popularity, we could have gone and said: we believe in economic and monetary union, we actually want to be a part of the Euro at same stage, admittedly not just yet, but what we'll do now is give you, the people of Britain, the chance to vote in a referendum at this stage. So that when the time comes, we can say we got your mandate, we'll go into it. Instead, you've ducked that choice. PRESCOTT: I don't think we've ducked the choice. I mean we've said clearly that there are many difficult decisions that are bound to come about the membership of the economic and monetary union and we've spelt out what we feel are the conditions for joining and at the moment they don't fit those kind of convergence criticia and particulary the concern for employment. But we have now gone through, as you've seen there in Brussels, a decision for the establishment of that, but we've also made it clear that we will make our own decision, a decision will be taken after this parliament and it will be confirmed, not only by government and parliament, by the referendum. Now, these are constitutional changes of some fundamental concern and I think that is the right way to do it and it seems that the public, generally at this stage, seem to endorse that. HUMPHRYS: Well, whether it's the right way to do it or not, is open to doubt. PRESCOTT: But you're asking me what the decisions are John, and I'm saying- HUMPHRYS: No, no, what I was suggesting to you is not that you take the decision now, there are prefectly good reasons for not taking the decision now. Many people would say that. But because you believe in principle, in going into EMU, because you believe that in principle, what you could have done now is say: right let people vote in a referendum, we will then have that in our back pockets, so that when the time comes, we can say: we will do it. But you can't do that- PRESCOTT: But that seems a most unusual way of doing it because government would have to make a recommendation one way or another. It can't say to the people: make your own mind up. We would have to make a recommendation. They would want the sufficient information to understand that it was going to be beneficial to Britain, it was in our interests and not to be damaging. And it's not clear that that's the case at the present stage- HUMPHRYS: -but you've already said that you accept- PRESCOTT -it would be nonsense to be suggesting that in fact, that we wouldn't go forward with the proper information which isn't available at the present time. HUMPHRYS: Well, no, because you've already said that you want to go in in principle. Indeed Jacques Santer told me this week, that as far as he is concerned, as far as Europe is concerned, it's not a matter of if, it's a matter of when. But you have said quite clearly you won't go in unless you have to pass certain tests, one of those is a referendum. Now, you could go to the people and say, this is what this government believes in principle, now you give us your support on that fundamental matter in principle. PRESCOTT: Well I think we're in disagreement about this matter. I don't think the issue is one of principle in putting forward, the one of principle is that the public should have the right to make the decision. You will recall on the entry to the Common Market, I mean I was one of those that was strongly against this at that time, and a Labour Government came in saying that we would consult the people. First, by negotiating and going around to see if we could get the terms better, after the previous administration had taken us in, and then give them the chance on the referendum which is what we did. But it was only after we got the information from Europe and we were able to say: here's the case for it, the government recommends yes, now they'll be a referendum. Now, that's precisely how we did it before. And I might say John, it brought the public around to having to make a judgement and it didn't have the bitterness that was so shown in the arguments about the For and Against the Common Market. And in that sense it's allowed a proper decision to be made, I disagreed with it at the time, but we are a matter-member of that community now and I think that's the way to do it. That's the principle way to do it: proper information, democratic accountability and in this case, allowing the people to make the decision by referendum. HUMPHRYS: But one reason why, perhaps, you've not gone into that referendum at this stage, with all the support that you've got, is that you know that it would be terribly unpopular with the an awful lot of people and my contention is that you are actually avoiding, at this stage, those difficult choices, maybe because you are scared of what the Murdoch newspapers would say for instance. PRESCOTT: No, I don't think the Murdoch newspapers come into it at all. There are some real difficulties about what is going to happen about employment, what are we going-get convergence in our economy. Such wide disparity at the present stage, whether it's on interest rates or inflation. These are fundamental matters, but you are locking yourself into an exchange rate in that sense. So to that extent, we are right to say, and we argued this in the election John, we are only doing what we said we'd do in the election. HUMPHRYS: But one of the consequences of that, and we can see it now, is the recession in manufacturing industry, brought about largely as a result of a very high pound and that may well be even worse tomorrow, who knows. PRESCOTT: Don't let's talk ourselves into a recession- HUMPHRYS: -we're there. PRESCOTT: -there are some difficulties on the horizon. We can see the difficulties that we've had over a long period of time, particularly in the consequences of the pound and the fluctuation and indeed it's stop-go as Gordon Brown has always made very clear. Full endorsement of government in this, that we want the long-term approach in this matter. We don't want the boom and slumps. He was aiming for a reduction in the long-term interest rates, which is the best for our manufacturing in the long run and that's what he's doing at this present stage, doing it quite well I think. We are already beginning to see some of the indications of it coming down. But it is difficult. We are running for a long-term kind of approach to this. I think Britain has been plagued for too long, certainly decades and even going back previous-to the previous administration where boom-slump was a way that got about in our economy and created, in the long run, real difficulties for us. HUMPHRYS: But if you'd taken that hard choice, the choice of going to the people, at this stage, you might have avoided that. PRESCOTT: Well that's an interesting point John. If the hard choice is to do it now, the assumption is that somehow you're putting it off because you don't want to face the decision. I think hard choices are about when the issue is absolutely clear and you have to make a decision one way another. I think if you are making a decision before the information is available, that's not a hard choice, it's a daft choice. HUMPHRYS: Alright, let me take one of those things that you did include in your list and that's the Welfare State. Now, here again, you said you'd taken some hard choices there, I'm not quite sure what they are. I mean what you did say, was that you would produce a Green Paper setting out-a White Paper setting about all sorts of positions that the government might, or might not take and you were going to tell us what the principles were on which you stood and then there could be this great debate. Well now, that was supposed to come out before Christmas, then they said the Spring, well it finally did come out at the end of March. But what it was, was a kind of series of platitudes really, it didn't tell us very much about what anybody thought about very much at all. Now that was ducking hard choices wasn't it? PRESCOTT: I'm sure there were people like you saying when the Welfare and the Beveridge Report, there might have been a series of platitudes. HUMPHRYS: Oh, not at all because there were very clear principles in.... PRESCOTT: Well then you obviously haven't looked at the front of the Welfare paper to see the same principles that are applied in our case. What we are saying is that the fundamental change has taken place from the Welfare State in the post-war period. That was a period when there was a lot of full-employment - when it was full-employment and the Welfare System was meeting the needs of two or three per cent who were unemployed and those who weren't able to work. That has fundamentally changed over these last few years. We now see millions of people forced to live in poverty on the Welfare State in many cases, costing us a hundred billion pounds after the previous administration's changes. Now what we've got now is a situation where many of them are children-are in increased poverty, people are forced to live on the Welfare, cannot afford to take a job, or rates that are a lot lower than what they get on their benefits because of the very low rates in the market. And what we've said is that we should look at the Welfare State and look at how we could get people off Welfare into work and that means making some very pretty tough decisions and we laid down those principles how we see it. Secure it starts, by the purpose of finding people work and we need to do an awful lot more to do that, it's not simply about pumping more money into the economy, it's dealing with the minimum wage problem, it's dealing with the jobs that are available, it's dealing with tax and credit that Gordon Brown did in this budget. Now that's a different approach to the Welfare, in the sense that it's trying to make it more effective, more efficient and it's based on giving people the opportunity of work which the market itself is not providing. HUMPHRYS: But the biggest chunk of that hundred billion that you talked about there is taken up with pensions. Now, we're no wiser really what you want to do with pensions than we were before you produced that White Paper. I mean, what we don't know - you've said that the basic state pension- PRESCOTT: Well we have said, John that wouldn't be quite fair. I mean, we have said that the report will be ready by June - right? And it's a controversial area as you well know, but it reafirms the principle, and the record of the Labour Party and the Labour governments of the past has been very clear. Our record on pensions is better than any other government has been, and what we intend to do now is to start the process where we re-establish the State Pension scheme. Gordon Brown's now actually lifted the pension scheme for a couple to over a hundred pounds - that's one start. He's done something about poverty in fuel, basically by giving them some more money for the fuel problems and reducing the VAT on fuel, and beginning to make other changes. The monies that we put in to health for example, assist elderly people. These are ways by which we can give a more comprehensive approach to the pension sheme. Now, you must wait for the review which has had something like twenty thousand responses, and that second pension, a bit on top of the basic pension which is at the heart of the pension review, will be given a judgement in June. HUMPHRYS: Yeah, but what-what we've all been waiting for, I think, since you came to power, is some kind of lead, some kind of indication as to where you're positioned here. I mean, yes, you say you've done a lot for the pensioners - you've given them pensions, you've given them bits and pieces here and there since you've been in, certainly. But the effect as I understand it, correct me if I'm wrong, the effect of what your overall approach is, is that the basic state pension will remain certainly, but it will decrease in value, and what you're saying to us as a nation is we must have second pensions. Well, now that's fine. We've got to fund them for ourselves, and that's fine too, if we can afford it, but we've no idea what's going to happen to those people who are not able to afford a second pension. PRESCOTT: That's why you have a review,but you've put your finger on a real point as you say John. HUMPHRYS: It's a fundamental point- PRESCOTT: -the real value of the pension - the basic pension is increasingly falling, and it's going to cause real difficulties. That's because we largely had - it was changed to connection to inflation and not earnings. Now to those circumstances we have to look at how the second payment pension will be financed. There are pensioners existing at the present time who have to be dealt with separately from the long-term challenge for pensions where there are more and more people living - reaching an older age, and more people in that bracket which puts a tremendous demand on welfare resources. Now, it is a very real problem, it's not an easy one, and it's right for us to say, to enter in those discussions as we agreed some time ago, and the publication of our review will be in June. HUMPHRYS: But you've not given us a lead you see. You've not given us a clear steer. There are other areas, I mean like Child Benefit. Gordon Brown,it appears, wants to tax Child Benefit for the people who are better off. Apparently Tony Blair doesn't, so it isn't going to happen yetf. It may happen. PRESCOTT: It's all probably and ifs. I mean the great problem of getting into this, is you're telling me what Gordon Brown says he wants, then you say..the Prime Minister- HUMHRYS: -he made it quite clear. PRESCOTT: The great thing is to rely on a proper and studied report from government, and then we can have the public debate and the decisions to be made by government. HUMPHRYS: Delays again you see. PRESCOTT: You have your finger particularly on a very hard choice, there's no doubt about it. And many, many pensioners are looking to a Labour Government to make the changes and to reflect the social justice which is constantly at the heart of most of our priorities. HUMPHRYS: But you see the impression has to be that that was deferred, an awful lot of this has been deferred because you ran into such flak when you tried to do things with the Single Parent Benefits,
that you thought, hello, we're going to be unpopular if we plough ahead with this, so let's put it off. PRESCOTT: Well, it's not put it off, perhaps it's to recognise the difficulties associated. I mean Tony Blair's made it absolutely clear, you can't solve the whole welfare problem and issues in a few months. In fact it's even more than one period of government. First of all you lay down- HUMPHRYS: You've had a long time to think about it.
You've had eighteen years in opposition.. PRESCOTT: First of all you lay down the principles, then you begin to find the priority of the resources and the choices that is to be made in that, and that's what we've started to do, and I think that's right and proper, and when you look at the Beveridge Report, it took a number of years through the War to establish that report and to determine its priorities. We're as involved in as much a fundamental change and challenge as was involved in the Beveridge Report, and we have at the heart of that social justice and principles which motivated Beveridge. We are now having to put those traditional values which I've often said, in a modern setting, and this applies to welfare as it applies to many other areas of Government policy. HUMPHRYS: Let's look at a problem that Beveridge didn't have, and that was transport, and this is your own bailli here. Now, you're obviously concerned about car use, you want us to use our cars less. Now, this is a hard choice here isn't it, because it's going to be very unpopular to say to people: you must - not you should - you must use your cars less. Now, there's a report this morning that you're being overruled on this because somebody in Downing Street, the policy unit at Downing Street are saying John Prescott wants to do something unpopular. He wants to say to local authorities you can slap big fat charges on people taking their cars into cities. PRESCOTT: I'm preparing the White Paper
and I have the responsibility for it. I can't answer for the reports in the Observer particularly- HUMPHRYS: But it's been postponed, that's the trouble. PRESCOTT: And then it reports - some report done by Geoffrey Norris or somebody, one of the aides in Number Ten. That doesn't make it Number Ten policy, and I can tell you, the one who's got the respoonsibility for this matter, I want people to use their cars less. I don't necessarily have to force them into that position, that happily happens in Europe, and they do it because they've got a better public transport system. They have a different set of priorities. Yes, there may be difficult choices. I
don't think they're as difficult as people think they are, but we do have to make a fundamental change, not only for a better transport system to reduce the congestion cost which is very considerable, but also to meet the environmental objectives that I've been negotiating in the UN with the climate changes. We have to make those changes, we have to reduce greenhouse gases. Now, when the White Paper comes out, and I can't discuss the White Paper, and it's not- HUMPHRYS: A delayed White Paper PRESCOTT: -I have to face those hard choices. If I have to change things around, those who are being changed in their view detrimentally by that, will claim it's a foul and it's a difficult choice, but you know a third of our people have no public transport or private transport whatsoever, and we've got to make some changes. Not only for good transport, but for the environment, because we've accepted legal targets now for the reduction of greenhouse gas emissions. HUMPHRYS: Is it going to be delayed even more then because of this row as you say - because Mr Norris takes a different view, and and because there is an argument going on over it? PRESCOTT: No, no, it's in the first week or the second week in June, that's what it was intended, it depended on the parliamentary time, because you know there's the Whit break in between that John. It's not delayed at all, it will be published at a time that we say- HUMPHRYS: -so, Mr Norris's argument- PRESCOTT: -watch this space and put your money on me. HUMPHRYS: Mr Norris is going to be overruled then is he? PRESCOTT: Who's Mr Norris? Mr Norris is an official in the department, and sometimes I call them teeny-boppers. You know what I mean. I'm the Secretary of State. HUMPHRYS: No, I haven't heard them referred to as teeny-boppers. PRESCOTT: You put your money on me. HUMPHRYS: Put the money on you. So we are going to see something pretty tough happening there? PRESCOTT: Well, Tony Blair's very strong about environment, he's very strong about public transport policy, right. I've no doubt about that. There are difficult choices because resources are involved, some hard choices, but I have to convince the electorate of that and I intend to do so, and I'm looking forward to it. HUMPHRYS: The only problem with that is that Mr Norris may be a teeny-bopper, but he works with Tony Blair doesn't he, and he's the Prime Minister. PRESCOTT: Well, watch this space. HUMPHRYS: Alright. Fairness at Work, another White Paper endlessly postponed, and that because the TUC was going to have a conference on it this month. They had to postpone it because you simply can't make up your mind what to do about Trade Union recognition. That was in your manifesto. Trade Unions thought they knew what you wanted to do, CBI didn't like, the bosses didn't like, it would have been unpopular so you put it off. PRESCOTT: John - you are dealing with all these speculation problems, and of course there's been a conference that has been cancelled. Discussions are going on between all the parties as we said we'd do in our White Paper. There will be a Fairness at Work White Paper, whether you're in a Trade Union or not we'll be extending the rights of work for people at the palce of work, and one of those things will be the right to belong to a Trade Union. After all one of the first things we did was to reverse that terrible injustice done to trade unionists by the removal of their rights at GHCQ. The business of the social contract - social charter has allowed us now to extend some of those rights, so wait for the White Paper - it's not so wrong, we've only been in twelve months, we've got the agreements that are coming along, and you will see a considerable advance when that White Paper is produced. HUMPHRYS: But Tony Blair himself said in the House, that you were still discussing what the manifesto meant, so... PRESCOTT: So what's terrible about that? HUMPHRYS: Because ... I'll tell you.. it's not terrible, but it's a bit odd isn't it that you write a manifesto and then it takes you a very very long time after you've been in government to decide what you meant when you wrote that manifesto. That's what I mean about hard choices you see. PRESCOTT: You clearly haven't read in detail the Manifesto. What the Manifesto ... HUMPHRYS: I assure you I read it many times. I talked to you about it before. PRESCOTT: Well, am I on? HUMPHRYS: Yes. PRESCOTT: The Manifesto made it clear there would be a recognition of these rights, and what it said there would have to be discussion between the various parties. Discussion is taking place, it's not surprising it's controversial, you must wait the outcome of those results and they'll be in the White Paper shortly. HUMPHRYS: So what you're not saying here is.... PRESCOTT: It's called government.... HUMPHRYS: Alright, it's called government, but government's about leadership, and it seems sometimes what you're actually saying is: we're a populist government and where you follow we will lead, that's what you seem to be saying. PRESCOTT: What do you mean - leadership like dictating or something. I don't care what you say, I want you to do what I want. HUMPHRYS: Leadership by focus group. PRESCOTT: Pardon? HUMPHRYS: What about leadership by focus group? PRESCOTT: Well I don't think-I mean if you get an idea of what people are thinking by focus groups - I've been critical fromtime to time of these matters, there's no difficulty about getting an opinion, you can take it into account as long as the politicians end up making their decisions and they're accountable for it, and not completely steered by them. That's always been my view - I'm not against taking an opinion. And I'll tell you what, it's a very interesting point this, the volatility in the electorate is a new feature of democratic politics I think in the next decade or so, and people are much more volatile how they vote, whether it's young people, women, men, it's no longer the one vote, voting Labour on working-class solidarity, there have been considerable changes underway, and finding out what people want and then identifying that in the election card that we did, the contract we have with the people is the way we'll be judged, and when I hear all these talks about third ways and big tents and all these kind of discussions and people, intellectuals going on the television and saying: can't understand what's happening here, here's a government still more popular twelve months after it was elected. Perhaps it's because we've found out what the people wanted and all the people, and then began to deliver those promies. Now that might be a radical thought in politics, but that I think is what is happening and on May the Seventh when we have the elections I hope the people will get out and vote overwhelmingly for us. HUMPHRYS: John Prescott, thanks very much indeed. PRESCOTT: Don't forget to vote. HUMPHRYS: Certainly not. ...oooOooo...