................................................................................ ON THE RECORD RECORDED FROM TRANSMISSION BBC-1 DATE: 9.7.95 ................................................................................ JOHN HUMPHRYS: Good afternoon. Michael Heseltine - Deputy Prime Minister - the most powerful man in the government next to Mr. Major himself. What will he do with that power. I'll be asking him On the Record after the news read by Jennie Bond. NEWS HUMPHRYS: It didn't take long for Mr. Major to get his job back before everyone was concentrating on the dog who didn't bark: Michael Heseltine, first secretary, Deputy Prime Minister. Everything suggests that he will have enormous influence: his title, his place in the party, the loyalty he showed to Mr. Baker, to Mr. Major and so on. But how does he intend to use that influence? When I spoke to him in Oxfordshire this morning I asked him whether he saw his new job as an opportunity to influence a whole range of policies. MICHAEL HESELTINE MP: Well in that an important part of my job is to support the Prime Minister generally that must be true, but I think it's very important to understand two things. First, that because of the constitutional position of this job, one's authority is dependent entirely on the support of the Prime Minister. Secondly, because of the constitutional position of my colleagues as cabinet minister in charge of departments the only way that I can exercise influence is through them and with their support. So it is a job which, within the constitution of our country, does require that particular understanding of the person who holds it, in this particular case me, as to exactly where power lies within our way of working. HUMPHRYS: Are you expecting that support? HESELTINE: Yes I am and certainly I've been immensely flattered really by the way in which the Prime Minister has offered me this task but one of the things that influenced me is that ever since I've known John Major I've had an excellent relationship with him. People don't remember now but the first manifestation of that was when we built a fence around Molesworth (phon.) in.... HUMPHRYS: Literally? HESELTINE: In a night, in order to keep CND out of the second nuclear base and John Major was in his constitutency so I worked very closely with him then. HUMPHRYS: You say we built a..you didn't get out there with a hammer and nails and things? HESELTINE: The Ministry of Defence were responsible obviously. HUMPHRYS: You and Mr Major there with your pick axe and things. HESELTINE: You may remember the flak jacket which.. HUMPHRYS: I remember the flak jacket. HESELTINE: Which someone put on my shoulders when I went to thank the people who had made it such an amazing achievement. HUMPHRYS: So your colleagues who've been telling the newspapers this morning that you are going to run rampant, I think is the phrase that's being used in some of the papers - run rampant around government, have got it wrong? HESELTINE: No I think probably the press have got it wrong, as usual, because I doubt if any colleagues have been saying that. Particularly as they know how I work. If you take the model really, the easiest model to understand, if there are models for these sort of things. I've been responsible now for - I think nearly three years - for the competitiveness agenda of government and that affects all departments, public and private sector, and virtually every colleague. There's been no hint of dissent, there's been no tensions between colleagues. I've been responsible for the deregulation initiative, right across government, no troubles, no dissent
because I've always taken the view - two views, I think: first, that it's very important in doing these trans-governmental jobs to work with colleagues and secondly I have a self-denying ordinance that I never leak to the press. HUMPHRYS: Let's look at some of the policies that you may....or some of the issues that you may or may not be involved in. Europe obviously hugely important, inter-governmental conference coming up, Maastricht II as they say coming up in about a year from now. Do you think Britain ought to be entering that conference, approaching that conference in a spirit of give and take? HESELTINE: As long as they give and we take yes. HUMPHRYS: Literally? HESELTINE: Well what's the point of being there? You see people, why..what's the point of being in Europe, why are the member states of Europe there? They're not there for each other, they're there for themselves. It is British self-interest that has taken us into Europe and it is only British self-interest that should keep us there. I wrote a book some years ago called, "The Challenge of Europe - can Britain win?" I mean if you think of the big players of Europe, for example take Chancellor Kohl. Do you think Chancellor Kohl is there trying to sell out German interest, do you think he'd get elected by the German people if he was? Do you think that President Chirac has persuaded the French people that this is the time to lay down the sovereignty of France. What you are in Europe for is to see how in partnership with proud, independent nation states with long sophisticated histories, whether in partnership we can do more together than any of us can do apart. HUMPHRYS: Indeed and working towards a common ideal and in that spirit you sometimes have to give a bit in order to create the common whole. HESELTINE: Well if you take the Single European Act which Mrs Thatcher was responsible for, putting to the British parliament, of course there was an understanding that if you want common rules across a common market you had to exchange the national rules for those common rules. Now
that was giving a bit, but what did we gain? We gained the fact that we had a very very large home market, we gained the fact that Britain was able to become THE most attractive inward investment base of the countries that were seeking a base in that market. We gained the opportunity to increase our trade to that market very significantly. So all of these things were part of a concept for Britain of enlarging our powerbase and if you look at what John Major has done, he has said to the Europeans: "Look, your concepts of a corporatist state dominated economy is not going to work. We want to privatise, we want to de-regulate, we want to promote efficiency and competitiveness" and they're moving that way. Just take another example of this. Why do you think that the Germans are so keen to see us adopt the Social Chapter in this country which we've refused to do? It's not some great vision of a greater Europe, it is because they've got a high on costs in their industry which they can't get rid of because their unions would never allow it. So the next best thing is to impose those on-costs onto us which we won't have. HUMPHRYS: You seem to be taking a fairly tough line on this. Does this mean that you would prefer to see the inter-governmental conference break up or break down, rather than give in certain areas. HESELTINE: Well I would rather see it make progress. HUMPHRYS: Indeed, but given that that may be difficult if Britain takes a pretty obdurate stand and says we won't give anything here, here or here. You would prefer to see the whole thing come apart rather than us make some concessions. HESELTINE: Well one's experience with Europe is that these things don't come apart. In the end one finds a way forward, that's usually what has happened. Not always but usually what's happened. I mean we did at one stage in Messina in the fifties, we walked out and then the French and the Germans fixed the Common Agricultural policy to suit them and when we evenutally joined we've been paying for it every since. So walking out can be an expensive option, it's not the sensible way to try to influence the future direction of Europe, it's not the sensible way to allow your major trade competitors ie. France and Germany to set rules for a market in your absence. It's not the sensible way. But that doesn't mean to say that you surrender British interests. Now that's the real difference between the position of John Major and the Conservatives and Tony Blair. Tony Blair would surrender to the French and to the Germans essential British interests, he'd give in on the Social Chapter, he'd give in for a minimum wage, powers back to the unions, you can hear it all. HUMPHRYS: So to go back to Messina, we would walk out rather than see things develop in a way that we don't like. HESELTINE: I think that to put that question and to try to get me to suggest that that's what we would do is... HUMPHRYS: Well I was following up your answer. HESELTINE: Yes, but you know you are taking it a stage further than any sensible... HUMPHRYS: But that's the logic of it isn't it? HESELTINE: You're taking it a step further than any sensible politician would want to go because the essence is to try to win and if you go to a conference saying: "If I don't win I walk out". HUMPHRYS: Of course... HESELTINE: You've lost all influence before you get to the conference, and nobody wants to walk out. What we want to do is to make Europe competitive. We think our way is the better way of any alternative. The British economy today is leading Europe out of recession so we want them to understand how we are doing that and to come in the direction which we're pointing. HUMPHRYS: But you're saying, quite clearly, winning is more important than consensual, than agreeement. HESELTINE: Winning is more important than an agreement if an agreement is against our interests. That is how John Major actually managed to get the opt out to the Social Chapter and of course to Monetary Union. HUMPHRYS: Well, I was going to turn to Monetary Union, to the notion of a single currency. It's obvious that at the end of the century, notwithstanding what was agreed at Maastricht most countries are not going to be in a Single European Currency, at least that's the way it looks at the moment. If in 1999 that turns out to be the case, would you be happy to see Britain as the leader of those outside countries? HESELTINE: Well I think you answer your own question when you use the word 1999. I don't think there's any purpose in trying to analyse today and take decisions today on something that may or may not happen in 1999. My preoccupation is a much simpler one, I'm preoccupied with what is bound to happen in 1996 or 1997 which is a General Election which could bring a Labour Government to this country, which would actually surrender essential British interests to the European powers. HUMPHRYS: But can you countenance the idea that Britain is the sort of leader de facto or whatever of this group of people who are outside? HESELTINE: Much more important is for Britain to be the leader of a group of people inside. HUMPHRYS: Ah. HESELTINE: But that doesn't mean that you in any way compromise the interests of Britain to be in that position. HUMPHRYS: And you say that 1999 is too far away, but you made up your mind a long time ago that a Single European Currency was essential didn't you, you wrote: "no truly united market can exist without a single currency. HESELTINE: I certainly did say that if you are dealing academically with the concept of a pure market you will have a whole range of things, you will have a single currency, but I didn't say that that means you will get there and indeed if I could remind you, you can't in any way be expected to know this, I made a speech in Hamburg before Mrs Thatcher resigned, proposing the opt out for Britain, and it was widely distributed, the speech, long since forgotten I have to tell you, but I did make it. HUMPHRYS: You're quite clear now though, that it's more important, if I understand you correctly, it's more important that we be inside leading from the inside... HESELTINE: In a direction of our choice... HUMPHRYS: In a direction of our choice, which may or may not be a single European currency? HESELTINE: Correct. HUMPHRYS: And as far a referendum is concerned, are you still as obdurate you were? HESELTINE: I have always believed in the sovereignty of parliament, and I've always found it difficult to believe that you enhance the sovereignty of parliament by a referendum. I know that Harold Wilson did it, but he did it because he couldn't unite his party. It was nothing to do with the desire for consulting the people, it was simply a political device, characteristic if I may say so, of the way that Harold Wilson ran his government. HUMPHRYS: So, in your new role as Deputy Prime Minister, you would urge your counsel, Mr Major, if he were so inclined, and he may well be so inclined, he's told us he may, not to think about a referendum on a single European currency. HESELTINE: Well, he's made his position quite clear, and I've reinforced it. HUMPHRYS: He's left it open. HESELTINE: He's left it open, that's right and therefore there will be a discussion and a decision, but there won't be one - when did you say, 1999? If events make it possible? Can I just make a very important point. There are huge issues, immediate issues, which confront this country this side of a General Election. Public opinion, to the best of my knowledge, puts Europe tenth, eleventh in its concerns? HUMPHRYS: Yeah but you wouldn't. HESELTINE: I would certainly put it in terms of the political urgency of the matter. The IGC is next year, it may go on, the year after that, who knows. So why are we so preoccupied by this particular issue, which is not the one that the great British public are preoccupied by? HUMPHRYS: Because the Prime Minister himself, and many others have said, it's the single most important issue issue facing Britain in the foreseeable future. There's nothing more important. HESELTINE: In the future, but not this side of a General Election. The issue that is facing Britain is how we enhance the competitiveness of this nation in order to increase the wealth of this nation, in order to meet the aspirations of the people of this country and whether we do that with Tony Blair in No 10, or with John Major. Those are the issues. HUMPHRYS: But just to be clear about your position on this. If when it came to it, Mr Major was minded to think about or to put to the Cabinet, at least the notion that there should be a referendum on a single European currency, your advice, your strong advice, would be 'no, don't do that'. HESELTINE: If he puts it to the Cabinet in the circumstances where we are discussing a single currency at the time, the Cabinet will make up its mind. I will be a member of the Cabinet, and you've asked me what my views are, and I have nothing to add or subtract to that. HUMPHRYS: Let's look at some of the other issues then, some of the sort of issues which you've said, will decide, probably, which way the election goes in a couple of years' time, and taxation clearly is one of them. There's a lot of talk about the need for tax cuts, clearly. Are expectations, do you think, too high at the moment? HESELTINE: There's a balance to be struck between what the country can afford, and the understandable aspirations of a very large number of people, to keep more of their own money. This government will be centrally influenced by the proper management of the economy. I happen to think that Ken Clarke is presiding over a very exciting economic recovery. That doesn't mean to say it's yet got to the benefit of the people, I understand the problems, but in terms of the economic recovery, Ken Clarke is achieving a very remarkable development, and we have to stick with that. He won't waiver, the Prime Minister wouldn't encourage him or want him to waiver and so it will be what the nation can afford, and that will be against a
background of the proper development and maintenance of economic priorities. HUMPHRYS: So should we therefore, in terms of that balance, be redoubling, should you be redoubling your efforts to find ways of cutting public spending, before tax cuts. HESELTINE: Yes, certainly. Certainly. HUMPHRYS: That is....that can be done. HESELTINE: To reduce public borrowing. HUMPHRYS: To reduce public borowing, not to afford tax cuts? HESELTINE: You are then in a position to make judgements about what you do with the lever you've created, and that is for my colleagues to discuss. HUMPHRYS: So what's your priority then? To reduce public borrowing, or to hand something back to the taxpayers? HESELTINE: The option is opened up, if you have made the reductions in public expenditure, I personally would be in favour of finding ways of reducing public expenditure, I don't know any member of the Cabinet who wouldn't, but you have got to balance that against the very legitimate requirements if you take the very exciting opportunities that Gillian Shephard has got, now I've laid emphasis on proper economic management, every member of the government believes that, but if I had to move outside proper economic management, I think my second priority would be education and training, in terms of the overall competitiveness of the economy and I think thast the announcement that the Prime Minister has made that he is going to..has now put Gillian Shepherd in charge of through life education is a world state of the art political concept. HUMPHRYS: Cutting public borrowing isn't going to win you an election in the way that tax cuts might. HESELTINE: It is a step in the direction of being able to make decisions about tax cuts. HUMPHRYS: But there's a clear difference in emphasis here isn't there. HESELTINE: It would be wrong to suggest there is any difference of approach on this matter, what the immediate priority is of the Chancellor are to get down the levels of public expenditure as a consequence of which he'll get down the level of public borrowing. HUMPHRYS: Are the targets tight enough at the moment? HESELTINE: I believe that they are as tight as the policy of the government demands, oh there's a fly. HUMPHRYS: It has been buzzing around and getting in the way...so you will be in there to go back to your role in all of this, you will be in there battling for cuts in public spending. HESELTINE: Certainly. HUMPHRYS: Are they going to listen to you? HESELTINE: As I shall be supporting the Prime Minister and the Chancellor and the Chief Secretary that will be a pretty formidable team, particularly as I don't know any colleague who is against what we are trying to do. HUMPHRYS: What about expectations that has been raised, that have been raised on the part of home owners, who want some sort of help, certainly many of the Conservative backbench MPs are desperately worried about this, do you think there is anymore..anything that can be done, is there anything more, anything that can be done to help them? HESELTINE: Well this is a matter for the Chancellor and his budget and you raise of course the critical point that anyone who is dealing with government policy across the round (sic) has to recognise is that it's colleagues who have Departmental responsibilities that make the announcements and take the decisions, I'm there to help them and support them, in no way am I going to try and pre-empt their options or in any way to set up a sort of tension between the two of us. HUMPHRYS: But housing crosses all sorts of boundaries... HESELTINE: Yes it does but the specific issues that you are raising are essentially for the Chancellor. HUMPHRYS: So where might you get involved then? HESELTINE: Well I will get involved behind closed doors in support of my colleagues, as I have, for example on the competitiveness agenda. HUMPHRYS: But you've always done that, I mean that was in your old job... HESELTINE: Oh yes yes but it..the principle is the one that we are talking about, you will not find me divided from my colleagues and you will certainly not hear of any discussions that have gone on between me and my colleagues other than from them. HUMPHRYS: Well then it begins to look a little difficult doesn't it, to see quite where your influence is going to come... (talking together)...... HESELTINE: No it's not difficult at all. You can exercise in my view more influence if your colleagues trust you than if they don't. The worst thing that could happen is that if colleagues felt that I was there trying to steal the limelight, trying to undermine their position, trying to make them do policy changes they don't want to do, all that would do would be to close the doors of Whitehall and I've spent three years with the competitiveness agenda, which covers all these fields, as you will well appreciate on the competitiveness committee the Chancellor sits and other colleagues sit there as well. There has been no problems at all of the sort that you are raising with me simply because whatever decisions were taken, were taken in private and the colleagues that were responsible for carrying them through, sometimes they were...they listened to ideas that might have come from other colleagues, sometimes even from myself, but there was never any attempt to give an impression that someone had pushed a colleague or undermined a colleague, that's not what we were doing, that's not the way the system can work or should work. HUMPHRYS: But it's quite hard to see your role, I mean I take your point about working quietly behind the scenes but working quietly behind the scenes doing what, if you are not seeking to influence policy, you've got no direct departmental responsibility... HESELTINE: John, you've missed the point. Influencing policy behind closed doors and in private is very much a part of the responsibilities that I have. What I am not in the business of doing is letting down my colleagues and what I am really saying to you, to the question can it be done, I've been doing it for three years. HUMPHRYS: But you've been doing it with an obvious job, I mean, everybody knew what Michael Heseltine did, it was quite clear the President of Board of Trade, Secretary of State for Trade and Industry, in charge of an important department, in charge of the competitiveness agenda. HESELTINE: Yeah well I am still in charge of the competitiveness agenda. HUMPHRYS: Were you offered the Chancellor's job? HESELTINE: No. HUMPHRYS: The papers are reporting it this
morning as fact or some of the papers are reporting it as fact that you were offered..... HESELTINE: Do you know I am glad you asked that question because it is one of the difficult things to know how to deal with this issue. There is a three letter word to describe that story, Churchill talked about it .... in a rather longer way of saying the same thing. Can I just..I gave an on the record
account of what happened to all the Sunday newspapers on Friday. This wasn't raised then, so somewhere a rumour has been started, one Sunday newspaper, the Sunday Telegraph, talked to me yesterday and I told them that it was categorically untrue, no other newspaper talked to me, I'm not saying they didn't ask Whitehall or whatever it may be I don't know, no-one talked to me, and yet today we see this all over the shop in the Sunday newspapers. There is no truth in it at all. HUMPHRYS: Somebody's stirring up trouble? HESELTINE: Who knows. But what I find so unacceptable because it's characteristic of what now is happening in Fleet Street all the time, is that there's a sort of print it first, check it if you've got time later, and the damage that that does in incalculable. HUMPHRYS: They only print it because somebody tells them. HESELTINE: Well, there are only two people, or three people I suppose who could know the truth of that story. Well, two in the case of me, the Prime Minister and myself, because no-one else was present at these conversations, and I can tell you there was never at any time any suggestion, any hint, any thought, any wish to bring about that, and even - I could even go further. First of all the relationship between the Prime Minister and the Chancellor is extremely good, but my relationship with the Chancellor is extremely good. We have worked immensely closely together, we agree about most things we discuss, and I personally, if I may say this, if I had ever been in a position to influence the matter which I wasn't because it didn't come up as a conversation, I would have been appalled at the idea that Ken Clarke didn't go on as Chancellor, but so I'm sure would the Prime Minister. HUMPHRYS: The reason that you're sitting here this morning as Deputy Prime Minister, and not perhaps Prime Minister in waiting is, many say, that you recognise that you could not lead the Tory Party in the end, because the party is so divided that you'd be leading a broken back party and Mr Major's the only man who could have done that. Was that the calculation you made? HESELTINE: Well, you see this is another - we did go into this at great length on Friday. These are the sort of issues that were coming up, but the truth is much simpler, and you know it because you've tried on the Today programme many times to elicit a different answer from me. I told you I would never stand against John Major. I told you that probably two years ago when the issue had first come up. HUMPHRYS: I tell you what you said two years ago was that you allowed the impression to be created wittingly or unwittingly that if the circumstances were right you would still like to be Prime Minister. There's nothing wrong in admitting that. HESELTINE: No, no, no, I of course I have never suggested that there was anything undesirable about being leader of the Conservative Party, it's a hugely prestigious thing and important thing to do. HUMPHRYS: And is that still your view? HESELTINE: Of course it's my view, I have - nothing would change my view that being Prime Minister of this country, being leader of the Conservative Party is the highest honour that someone in my particular party and in profession can achieve. HUMPHRYS: And given the circumstances and I emphasise..if I can just press this point to you directly... HESELTINE: ...you've got to....I mean we've been round this course so many times, I want to stick with the context in which you raised it. I made it clear that I would never stand against John Major. There was no qualification about that at all, and so when all this stuff started coming up and all sorts of people asked about it, journalists asked about it, colleagues in the House asked about it, friends asked about it, people wrote me letters about it, they all got the same reply: I will not stand against the Prime Minister. And so when we got closer to the event all that happened is that I did what I said, nothing changed. HUMPHRYS: Given the circumstances, and I emphasise given the circumstances, would you still like to be Prime Minister? Well, it was quite clear that at one stage you wanted to be, two years ago in this room we discussed it in those terms. Are you now saying to me that this man, Michael Heseltine, who's brought down one Prime Minister, perhaps created another Prime Minister, has decided at this stage in his life: that's it now, it's over. HESELTINE: John Major won the election which I contested some years ago. He was re-elected by an overwhelming majority of the Conservative colleagues in the House of Commons the other day, that's the end of the matter. HUMPHRYS: Right so it's all over for Michael Heseltine, potential Prime Minister, that's it? HESELTINE: No, it certainly isn't all over for Michael Heseltine, I'm Deputy Prime Minister... HUMPHRYS: Potential Prime Minister. HESELTINE: Deputy Prime Minister I am. That is a great honour and one I intend to discharge to the best of my ability in support of my colleagues and above all else in support of the Prime Minister. HUMPHRYS: Michael Heseltine, thank you very much. HESELTINE: Thank you very much. ...oooOOOooo...