............................................................................... ON THE RECORD NORMAN FOWLER INTERVIEW RECORDED FROM TRANSMISSION: BBC-1 DATE: 06.11.94 ............................................................................... JOHN HUMPHRYS: Sir Norman Fowler, so it's radicals versus consolidators. Let's deal with a specific first, something that has happened - Post Office, or rather has not happened, Post Office privatisation. Is it over now? SIR NORMAN FOWLER: No, I don't think it is over. It's obviously a set back, and obviously people in the party, in the parliamentary party, the vast majority I think, are disappointed, angry at the way the decision has gone, but I don't think that's an end to the matter. I think that this remains, and must remain, a policy of the party and of the government. I can't predict when it can be put into effect, but what I do tell you, is that it makes no sense to have the Post Office shackled by public sector controls, there is absolutely no reason why the delivery of letters should in some way be a function of the government and only government can do it is absurd. And so we need to persist with that. HUMPHRYS: In the next manifesto perhaps? FOWLER: Well, if not before, but to be realistic you're probably right about the next manifesto. But I personally would support it at any stage. I do not think that it makes sense from the businesses point of view. This is, I mean, this is the thing which no-one addressed, or too few people addressed in this debate, it makes no sense from the Post Office's point of view. Everyone talks, and one heard the Labour party talking about the public, the Post Office, can have freedom withinside the public sector, it can't have the freedom inside the public sector it would have in the private sector, because if it was public money, there are going to have to be controls, the ministers and civil servants are going to have to look at it, look over it, going to have to interfere, because they're accountable for that public money. HUMPHRYS: So extremely important from your point of view, and the government's point of view that it should have happened, and you were thrown off course by a bunch of back benchers, a small group of backbenchers. FOWLER: We were, and that is regrettably the name of the game when you only have an overall majority of fourteen or fifteen, and there I think are lessons for the party on this, and on other issues as well. I heard what Norman Lamont said. Well, I very much hope that when it comes to other issues Norman Lamont will also take the view that it is the majority of the Conservative party that should have the final say in these issues. I regret very much that in this issue the majority of the Conservative party did not have the final say. HUMPHRYS: So you'd agree with him, would you, when he talked about, what was that phrase - "flotsam and bobtails", who should have their heels held to the fire, should have had their heels held to the fire by the Whips? FOWLER: Well, I'm not going to go into the descriptions, it strikes me as slightly confused description of the position, but what I would say is that the minority who have temporarily defeated us at this point, I don't think they represent the bulk of the Conservative party in parliament itself. HUMPHRYS: Well, why weren't they put to the test then, why didn't ... there wasn't even a White Paper, you abandoned the fight at a terribly early stage, and if you'd actually gone to a vote on it, the odds are, isn't it, that they'd have backed down, so why didn't Mr Major fight for this? FOWLER: Well, I think you've got to come to a political judgement. I mean we're sitting here, we've had to abandon this particular policy before the Queen's speech. I think if I were sitting here in nine months time, and we had been defeated on the issue itself, then you really would be far more critical of the government at that stage. Why did the government go ahead when all the signs were that they were going to be defeated? The government have got to make a decision on the facts of the case in front of them. The cabinet have got to decide whether they can get it through. And can I say one thing? It always seems to me that there is this marvellous black and white division ... which is ... and painting ... which is painted between the Major years and the Thatcher years, as if in Margaret Thatcher's time we didn't show caution as well. Let me give you one example. The Dock Labour Scheme which I abolished in 1989, that was about fifteen years after we said that we were thinking of abolishing it and after the party opinion was in favour of it ... you've always in these things got to have regard to the political reality in that, and that's what the cabinet did. HUMPHRYS: Well let me give you two examples where you faced up to the rebels and beat them in the end, with very little concessions, and that was coal, shutting down the mines, and it was also rail. Great problems in the face of it, confronting you, but you faced up to the rebels and won. FOWLER: I think that the party, the business managers, the cabinet, have got to make a decision on the facts in front of them. I don't know what the facts were that were presented by the Whips to them. I know certainly that the Whips were doing their sums, they're extremely good, Richard Rider's an extremely able Chief Whip. If the Chief Whip comes to you, and the Whips come to you, and say 'look we don't think we can get this through', then I think frankly a Cabinet or the Prime Minister would be very unwise to go against that and try to double guess it. There was a long debate on it, and we decided, or the Cabinet decided, that it couldn't get it through. I don't think the anger should be directed at the Whips, I don't think the anger should be directed at the Cabinet, I don't the anger should be directed at the Prime Minister, I think the anger should be directed at that small minority who didn't represent the party, who forced us to change policy. HUMPHRYS: So here's an important matter of principle that was lost, and yet you say it was handled well? FOWLER: Well, I think it was handled in the only way it could have been handled. You say lost - I don't think it has been lost permanently. It has certainly been lost as far as this legislative, this Queen's speech is concerned, but anyone who's been round the Cabinet table, knows perfectly well that when you come to a Queen's speech, that some of your measures sometimes get through for one year, and some don't get through. There's no reason why we can't fight on this again. And I repeat the point - that I think that anyone who thinks this is an end to the matter should think again, because I think one of the interesting facts of this, and one of the interesting results of what has taken place is that is had made the centre of the Conservative party I think much more determined, and really rather angry at what's taken place. HUMPHRYS: Well, let's look at the Queen's speech then. Michael Heseltine says there's going to be a lot of good tough radical stuff in it, notwithstanding the loss of the Royal Mail. Do you think that's right? FOWLER: Yes, I mean I have no more knowledge than you do of what are the contents of the ... HUMPHRYS: No, but do you think it's right that it ought to be, that the radical approach ought to be continued? FOWLER: Oh, indeed I do, indeed I do. I don't think that there's anything, I don't believe that governments can stand still. I think this idea that government can simply sit back and consolidate on past successes, I think that that is not remotely the case. I think that one of the troubles, and again it goes back to the Post Office, that one of the troubles has been, that we have in some ways become defensive on the privatisation issue. We shouldn't be defensive on the privatisation issue. Privatisation has been a great success, you can see it by the fact that governments from all over the world come here to see how it's done. HUMPHRYS: There will be more of it? FOWLER: There should be more of it, but above all we should not be defensive but trumpet what we have achieved by it, because what we have achieved by it, it's not only justly returns for the taxpayer and therefore for the public services that we're talking about, but we've also achieved great successes in management itself. Go and ask the people who actually work in the nationalised industries, go...(in the previous nationalised industries), go and ask the people who were the managers and are now the managers in the private sector. I don't know of any kind of great move to go back into the public sector. People, managers of these industries are not kind of walking up and down Whitehall saying 'please let us come back into the public sector'. HUMPHRYS: So privatise what, air traffic control for instance? FOWLER: Well, I think there's a very good case for that, yes, I think there is a good case for that. I think you should look at all these functions. HUMPHRYS: London Underground? FOWLER: I think you should look at all the functions. I'm not going to cherry pick ... HUMPHRYS: But I thought if I gave you a few it would help you to ... FOWLER: Well, London Underground it seems to me that you could actually in fact ... those are all areas that you could. The question that you have to ask is 'is there any over-riding reason why the government, why the state, should be actually running these services?' If there is, then okay, we can accept that. It's clear there are going to be divisions on that. But when it comes to an industry, when it comes to a company in the industrial environment, the natural place in my view for that is in the private sector, and I tell you, when I was Minister of Transport, I obviously did a number of privatisations of my own. We did some of the first. But what I do remember also is that when we had to operate with the public sector operators themselves, with British Rail, I don't think it's great fun for the managers of these public sector operations, to be peered over by civil servants and by ministers. HUMPHRYS: Right, but privatisation isn't enough to prove radical credentials is it. You've got to go that much further, you've got to have a vision, haven't you, and the real Tory vision is that individuals must increasingly take responsibility for their own lives. FOWLER: That is one vision. I mean my vision... HUMPHRYS: An important vision? FOWLER: That is an imporant vision. My vision of the Tory party is a vision of, I think it was what RAB Butler said years ago, of private enterprise, but without selfishness. And basically what that means is the kind of privatisation and private sector policies that we've been talking about, but then we have to go to the other side, and say those policies should be set out without selfishness, meaning that there must be policies which protect the ... those people in need in our societies. It's, I think, one of the most interesting debates that we should now be having, is a debate on the welfare state, and how far the welfare state should go. HUMPHRYS: Could I come to that in just a moment, but look at a few specifics first of where you might pursue this radical agenda. Let's have a look at for instance, education. You heard somebody in our film there saying we should encourage parents if they can afford it, and all the rest of it, to opt for private education, we should encourage that. Would you encourage that? FOWLER: Well I wouldn't encourage it any more than it's done at the moment. HUMPHRYS: You wouldn't give them tax concessions? FOWLER: No. I wouldn't give them tax concessions. I think that the options are there for education, I think that education we have carried out a whole series of changes. I think that conceivably when the Prime Minister was talking in his Party Conference speech about not change for change's sake or apparent change for change's sake, I mean, education was one of those areas where we appear to have had an awful lot of changes - perhaps piecemeal, I'm not making a criticism of that but I mean that appears to be what has happened. I think probably that is an area where a certain amount of catching up needs to be done, a certain amount of stability. HUMPHRYS: And what about health - another radical suggestion on health would be to encourage people to take out private health insurance. FOWLER: Again, I think that the position with health - and I had dealt with health for six years - is that you should have a very good National Health Service, that no one should be in fear of not getting medical care because of lack of income, but if people wish to and want to take out private sector health insurance then that should be absolutely their right. HUMPHRYS: Their right, but would you encourage them? Would you give them tax concessions? More than there are at the moment. FOWLER: Well there are tax concessions but I certainly wouldn't go beyond that but what I also wouldn't do is, as I think Labour seeks to do, is to say that there is something wrong, there is something immoral about that. I think the whole idea must be that there is going to be so much demand for medical care that it is the private sector, it is the public sector, it is the voluntary sector, together, which can do it. We need partnership as far as that is concerned. But the private sector is a very important part of that. HUMPHRYS: Right. Let's move now then to what you volunteered originally in this list and that's social security. In a sense, perhaps the litmus test of Tory radicalism - the Welfare State. You would of course accept that there must be a safety net for the most disadvantaged but otherwise, the kind of changes you have in mind? FOWLER: Well I think the fascinating thing there is if you look at Gordon Bowyers (phon) commission - the Labour Party's commission on social security, are the unmistakable signs that Labour is moving our way on this. When I set out our social security review in the ... three quarters the way through the 1980s, 1985/86, what I said then was that we should target our help upon those people who need it. Now you now look at Gordon Bowyers proposals, what do you see? You find on child benefit he wishes to tax it for the higher tax earners - in other words target on those people who need it, not on those who don't. And on pensions the most significant policy change which has taken place, if we weren't absolutely besotted by all these other issues we might have actually spent a little time debating it in the past month or so - the fact that he's moved away from the earning's pledge, the old pledge of the Labour Party: 'We'll upweight the basic pension by earnings," - their flagship policy. That's been abandoned. HUMPHRYS: Right, so what would you do then? You wouldn't target child benefit to the extent that only the poor would get it, would you? FOWLER: I would not, certainly wouldn't run away from doing that. I would certainly not run away from doing that. I think that that now has become an entirely sensible policy objective. But what I would do is I would do what I have always advocated and that is that really what we should be doing in terms of pensions is to improve the position of those on basic pensions - people who have got no other pension but the basic pension and there should be a pension credit for them. They should be brought up to a standard because they have not had the benefit of occupational pensions, and then what I would want to do is to move more and more from the second pension into the occupational private pensions so that there would be - for everyonee - you should have a second pension which would be in the private sector. HUMPHRYS: But the truly radical thing to do in this respect is to allow the state pension for those who have their own pensions to wither on the vine. FOWLER: Well, I don't know what you mean by 'wither on the vine' the basic state pension, it was one of the points which was made in the film, I mean I would love it to have been an insurance based scheme, but it isn't an insurance based scheme it's a pay-as-you-go scheme. In other words, you and I are paying for the obligations which come out of the pension system at the moment on the promise that we will be paid for when our time comes. It would be lovely to go to an insurance scheme but that isn't the case. HUMPHRYS: So let's look at some truly radical bits and pieces here then. Not bits and pieces, fundamentals - abolishing SERPS. FOWLER: Yes, well I've always been in favour of that. That has always been my view. I mean I have always set that out. In my view it was a great pity we weren't able to do that in the 1980s. There were problems, I obviously understand that there were problems but I think that the basic, the idea should be that the Government should look after - and look after more generously, let me say - those people who have to rely on a basic pension and that the second pension should be in the private sector and not in the public sector and I think SERPS goes in between the two. One of the most fascinating things we did in the SERPS review, we actually asked people who had the state earnings related pension scheme, about it. Half the public who had it didn't actually know that they were members of SERPS so I don't think one can really say that there was a kind of fondness, a kind of love of this particular scheme itself. What it also showed our review was that there was a love of having people having their own pension, their own occupational pension, their own personal pension, their own private pension. So that's the way I think we should be going. HUMPHRYS: What about private unemployment insurance? FOWLER: Well I think that the state, I think that the Government does obviously have a responsibility as far as unemployment is concerned. We have made some changes as far as the unemployment allowance is concerned. I mean, if people are able to insure against unemployment and, you know, many of the mortgages and things of that sort require that to take place, but I think that the idea that there should be, if you like, a six month - or it is twelve months at the moment, six months as it is likely to be - state backing as far as unemployment is concerned, I think that that is perfectly sensible. HUMPHRYS: What I'm really getting at is the point that Edward Lea (phon) made in that film is that nobody...he wants to look at social security on a kind of actuarial basis. Nobody gets more out of it than they put into it. FOWLER: Yes he does. But the thing that Edward, I think, is missing is that if we were starting from here that would be fine but we can't look on it in an actuarial basis in quite that way because it isn't an insurance scheme. This is the whole trouble. If we had followed Beveridge's (phon) view after the war we would have introduced an insurance scheme. It was a great tragedy that we didn't but we couldn't wait. So what we've got is a pay as you go scheme. Now having a pay as you go scheme and an insurance scheme on top of each other at the same time does mean double premiums for everybody and that is the problem. HUMPHRYS: Many people say that a lot of what you said here makes a good deal of sense and you're in tune with many people in your party but it isn't a radical agenda, is it? It isn't truly radical. It's a kind of fag end of Thatcherism. Lots more privatisation, a few bits and pieces here and a good deal of consolidation. That's not radical. FOWLER: Well I think it is radical in fact. I think that if you actually change the whole social security system, I think if you continue with privatisation, I think if you continue with the whole range of the other policies, that is a radical agenda. But if you are telling me that over the last fifteen years we have slain some of the dragons, yes that's true. We have slain, for example, the dragon of union power after a great deal of trouble. HUMPHRYS: Yes but that's been done. FOWLER: It has been done but there's no point therefore in going back to it and saying, you know, revisiting that particular... HUMPHRYS: No but what I've been doing is offering you various things where you could adopt a truly radical agenda and for the most part you've been saying: "Well, no, no, because that is too radical," and the fact is even if you wanted to do it you couldn't do it because you are not in step with the country then and this is the problem that you face. FOWLER: Well I think that you are wrong then. I think that there is always going to be a debate upon the individual measures that there are and I think that really what you would...I think that it would be a mistake to believe that some of the views which perhaps put it to the extreme represent the absolute radical pretentions and ambitions of the party itself. I would claim that the kind of policies that I set out are radical and they certainly would not be policies, I suspect, which would actually have all the wholehearted consent of all the people who appeared on your programme. HUMPHRYS: So yours is a kind of consolidating radicalism - if you will forgive the expression. FOWLER: No. Mine is a sensible radicalism. And I think that's what the Tory Party is about. Again, I come back to this point, John. HUMPHRYS: But the Tory Party isn't about that is it? FOWLER: It is exactly about that. It's exactly about that. I come back to this point. You paint the Tory Party - not you, but people generally - paint the Tory Party over the last thirteen/fourteen years under Margaret Thatcher, as if we took on every dragon as it came up and we actually went into it. We did not do that. We took it politically. You've got to have political commonsense in these matters and in these issues and Margaret Thatcher was extremely cautious. Again, I go back to the Dock Labour Scheme (phon). Nigel Lawson and I didn't actually believe up until the last moment we were going to get permission to actually go forward with that policy. HUMPHRYS: But political commonsense means you've got to look at the support you got for your programme and what that tells you. Look at the strength of the '92 group in Parliament. They're the people - many of them - in tune with the 'no turning back' policies. Now you can't embrace those policies on the one hand because the Government doesn't want you to because the country doesn't want you to and yet they want this radical approach and that's why the Government's kind of run up against the buffers. FOWLER: No I don't think it is. I think the reason the Government has run up against the buffers, as you put it, in the last few days, is simply the result and the inevitable result of actually having a small majority. The fact is that when... HUMPHRYS: But you've got stuff through with small majorities in the past. You''ve pushed it through - very small majorities. FOWLER: Yes but when I was Party Chairman we had some very near runs, I mean, you remember the European debate we had to have a vote of confidence on that ... and we won it by about three or four in the end. That is living extremely dangerously. HUMPHRYS: So you can't live dangerously any longer, can you? That's the whole point. You've got to settle back now and... FOWLER: You've got to make an assessment every time but what you cannot do is you cannot constantly look backwards. You cannot constantly look at the 1980s and say well it was all different then. HUMPHRYS: No, no, I'm not doing that I'm looking forward. FOWLER: No, but people are and because in the 1980s and 1983, 1987 we had very big majorities. When I was Social Services Secretary we had policies that we knew we would get through but we also knew that that sort of majority, that sort of minority, that we were talking about in the Post Office, would vote against it. It didn't matter then. HUMPHRYS: But you can't live dangerously - to use your own language - any longer. Therefore you've got to consolidate haven't you? FOWLER: You've got to ... no, no, no; you've got to decide which issues - every time - you have got to decide which issues you can win. I think it is a great tragedy that we weren't able to win this but I don't think you should write the obituary of Post Office privatisation. We can come back to Post Office privatisation, we can win that and we will do so because all argument and the Post Office is on our side. HUMPHRYS: Sir Norman Fowler, thank you very much. FOWLER: Thank you.