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Speech Archive

Leader's speech, Blackpool 1976

James Callaghan (Labour)

Location: Blackpool


Following Wilson’s retirement, this conference was Callaghan’s first as Party Leader and Prime Minister. Since taking office, Labour had introduced a framework of measures for industrial relations, which included the Health and Safety at Work Act and the establishment of ACAS. These initiatives, together with the Social Contract, would help Britain towards economic recovery. While this strategy was working its way through, the government proposed to tackle unemployment through such initiatives as the Job Creation Programme. Other important issues at the time were race relations, the possibility of devolution for Scotland and Wales, the situation in Northern Ireland, and the continuing negotiations with South Africa over the future of Rhodesia.

Mr. Chair­man, comrades it is indeed an honour to stand before you today as Leader of our Party and to present to you the report of the Parliamentary Labour Party.

My first words must be a tribute to the man who led us for 13 years, in good times and in bad, never faltering and never losing heart. He led us into five elections and he won four of them. Now he has decided to retire from the Leadership, but not from active public life - unchallenged and finally undefeated. The Conservatives never could master him. Indeed, to tell the truth, I think the National Executive gave him much more trouble than the Tories ever did! But quite apart from his well-known qualities as an out­standing Party Leader and a long-to-be­-remembered Prime Minister, countless rank and file members in our Movement, whose names will never hit the headlines, know him for his personal kindliness, for his complete lack of self-importance and for his generosity. He is, in the true sense of the word, a ‘comrade.’ I hardly know which of his many achievements will rank highest. But if he were asked - and I have not asked him - I have a suspicion that he would place among the things he really values his success in overcoming opposition and doubts and carrying through to a permanent place in our educational system, the Open University.

All of us in public life, whether it be ward secretary or Prime Minister, know that we can­not do our best work unless we have the con­tinuous, unfailing support and understanding of our wives. Any tribute to Harold would be incomplete without us expressing our affection to Mary also. Harold and Mary, Conference salutes you both. (Applause)

This annual report, I am bound to warn you, will miss his whiplash and his wit. All I can do is to follow his electoral example and lead you to victory in four elections out of the next five. (Applause) All aspirants to the Party Leadership, look out.

There now exists a broad framework of toler­ance and comradeship in the Party. Differences of opinion, strongly held, there will be and they will be passionately argued this week. But in a democratic socialist party there is no monopoly of revealed truth. Each of us knows that he has something to learn from the others.

Let me start by expressing my sincere appreciation - and I ask Conference to do so too - to my ministerial and parliamentary col­leagues for their unflagging hard work during the last year. It has been a tough year. For long months we governed without an overall par­liamentary majority. Sometimes we had to rely on colleagues who should have been in hospital or at home in bed, who risked their health to be Present in the House of Commons to see that Labour’s programme was carried through. And you know that it has been carried through. Take this Session’s Parliamentary Bills: ship­building nationalisation; aircraft nationalisation; tied cottages; comprehensive education; pay beds; all these are straight out of the Manifesto. All were opposed line by line by the Tories, all were fought for in the House of Commons by the Parliamentary Labour Party. Sometimes I think those who ask us to stick to the Manifesto are a little selective in their reading of what it con­tains. It was a collective and united effort, but let me thank the two men who had the final respon­sibility of making sure that the members were always - or at least, almost always - in the right place at the right time, the two Chief Whips, Bob Mellish and Michael Cocks. (Applause)

Comrades, there is a line of poetry which is a good line for socialists, even if it was not intended to be:

A man’s reach should exceed his grasp
Or what’s a Heaven for?

While our Conference will constantly reach towards new territory it gives us also a chance to put into perspective what we have done. I ask you all to read the outstanding check list that was reproduced in Labour Weekly a few weeks ago. The remarkable thing is not what we have failed to do, but how much has been carried out before we have reached even the half-way stage of this Parliament.

Nor were we elected on a false or a fake per­spective. Let me remind those who wish us to stick to the Manifesto what its opening words were: ‘Britain faces its most dangerous crisis since the war. 

The Manifesto went on to describe the worst world recession since the 1930’s, the five-fold increase in oil prices, an ever-narrowing industrial base and a level of economic performance which had been in steady decline, compared with our major competitors, for almost a generation. It is all there to read – ‘the most danger­ous crisis since the war.’

We followed a government whose failure to understand the trade unions led them into con­flict and confrontation, and which inevitably crashed in the chaos of the three-day working week. Labour was elected to heal that terrible wound which Tory obstinacy had inflicted on the nation: to replace conflict by partnership, confrontation by co-operation. We knew this was the only way for the country. The British people knew it. Our critics at home and our friends abroad knew it. Even the Tories in their own hearts knew it. There is no better way. So we repealed the Industrial Relations Act. We passed into law the new Trade Union and Labour Relations Act. We put on the statute book an Act to protect employment. We passed an Act to safeguard health and safety at work. We have established the new Advisory, Concili­ation and Arbitration Service for both sides of industry to use. Taken together these measures have given us a framework for industrial rela­tions which has enabled us to rebuild confidence between the trade unions and the Government. It has served Britain well. Consider the improvement in relations on the workshop floor. The number of days lost through industrial dis­putes this year is the lowest for any comparable period since 1967. And the number of disputes is lower than at any time since 1953. That should be the headline news; that is what the world should be hearing about Britain.

At a time when our foreign competitors and, even more important, our customers are ready to believe the worst, I say to the world that this Government has created an industrial framework based on voluntary methods that can serve as a model to anyone throughout the rest of the world. It should be used; we cannot afford not to do so.

But industrial relations is not just a matter of avoiding strikes, important though that is. That is a negative approach. Britain’s present economic position demands a positive approach: a new spirit of co-operation in indus­try, yes, co-operation between employers and trade unionists, changes of attitude on both sides. As I go around - and I do this a lot more these days than I used to - I find more and more active trade unionists, not theoreticians, but active trade unionists on the shop floor, recog­nising that they share a joint responsibility in their place of work. The ordinary worker is get­ting more and more outspoken in his opposition to the small bands of disrupters in industry. Where management is enlightened it, too, sees the need to change its attitude. ‘Theirs not to reason why’ is no more a recipe for industrial success than it was for military.

Now we look for further progress on two fronts. First, the Government is awaiting the report of the Bullock Committee on Industrial Democracy. When I visited the Federal Repub­lic of Germany a little earlier this year, Chancel­lor Helmut Schmidt arranged a meeting which I could attend between members of the Bullock Committee which included some delegates to this conference - notably Jack Jones and Clive Jenkins, as well as David Lea of the TUC and others - and their German opposite numbers who already have 25 years’ experience of worker participation. The Bullock Committee will reach its own conclusions and present them to the Government. But I want to say that I came away from that meeting with the German Chancellor and the representatives of German employers and German workers convinced that the introduction of a system of industrial demo­cracy into British industry must be given high priority by the Government when the Bullock Committee has reported. (Applause)

Second, we should like to see much faster progress on the question of Planning Agree­ments. So far there is a marked reluctance on industry’s part, on management’s part, to enter into Planning Agreements. Perhaps it is a reflec­tion of the ‘theirs but to do and die’ mentality that I have referred to. Some people - I have heard it expressed here - would like to see these agreements made compulsory. I am always a little dubious about the long-term success of shot-gun marriages. We have to convince the management of our larger firms and industries that Planning Agreements are in their interests too: that they will be a major factor in encouraging the productivity and efficiency so vitally needed. Our offer of co-operation extends to industry also.

It is not by accident that I decided to begin this report by discussing the Government’s attitude to industrial relations and industrial co­operation. Nor have I done so just to show what a hash the Conservative Government made of it. I start with this because until there is agreement on the place of the human being in our industrial society, we shall push and pull at the economic levers in vain. We have expected too much from the economic mechanisms and we have, paid insufficient attention to the most important component of all - the human element.

The worker’s relationship with his tools, his integration with his working environment, is the most important unresolved problem in our com­plex industrial society today. We have a people who are better educated, better informed, who have escaped from the deference of my youth and who now look to Government, to employers and to the trade unions to provide a framework and an environment that befits their higher status.

This Conference decided again yesterday, two and a half years after our election, that there is still no better way forward than the Social Contract to give life to this concept. That is as true for the employers as it is for the workers. Does any employer nowadays assert, if he ever did, that he preferred the days of Tory confrontation? Does anyone believe that unem­ployment will be brought down faster under the Tories? Does anyone think that with their sorry record of conflict the Tories could have halved the inflation rate over the last rate? Does anyone know what Tory economic policy really is? Do they advocate incomes policy or a free-for-all? Which is it - either, neither or both? No-one knows. Does anyone know whether the Tories would reflate or deflate? They talk of cutting Government spending. Does anyone know what more they would cut? Have they told us? They talk of cutting taxes. Whose taxes? Perhaps we can guess, but have they told us? Do we know? Would the tax cuts be larger or smaller than the spending cuts? Would the budget deficit be larger or smaller; does anyone know? Does any­one know how they will work with the trade union movement? Do they want to return to the conflicts of 1973, or do they now say – ‘We too will work the Social Contract.’ No-one knows. But how can a Tory Party even offer a Social Contract to the trade unions when it is pledged to the social policies and inequalities which strike at the, roots of our own movement? No. The Social Contract stands confirmed yesterday for the next three years because there is no other way, and it demands complete co-operation between the Party, the Government and the unions.

When I say there is no other way, that does not mean that it is going to be quick or easy. That has been promised before. It is neither. Britain has lived for too long on borrowed time, borrowed money, borrowed ideas. We live in too troubled a world to be able to promise that in a matter of months, or even in a couple of years, that we shall enter the promised land. The route is long and hard. But the long march has at last begun, and I hope to lead you at least some part of the way, with the Social Contract and our industrial strategy as our guide.

For too long, perhaps ever since the war, we postponed facing up to fundamental choices and fundamental changes in our society and in our economy. That is what I mean when I say we have been living on borrowed time. For too long this country - all of us, yes, this Conference too - has been ready to settle for borrowing money abroad to maintain our standards of life, instead of grappling with the fundamental problems of British industry. Governments of both parties have failed to ignite the fires of industrial growth in the ways that countries with very different political and economic philosophies have done. Take Germany; France, Japan - different countries, different philosophies. We are, as you know, still borrowing money. But this time we are not borrowing - if the Government con­tinues on its present course - to pay for yet another short-lived consumer boom of the kind which used to buy success at the polls - or so we were told - but which never bought success in the world’s markets or at the work place. We are borrowing now partly to pay for our huge investment in the North Sea. We are borrowing, too, because other industrial nations volunteer credits, so that our strategy and our proposals for regenerating British industry need not be thwarted by short-term speculative movements of sterling balances - a load we have still been unable to shed. We are determined that this borrowing will be used to act and to press on with the task of rebuilding a regenerated manufactur­ing industry. This time we are not going for a consumer boom on borrowed money: we are going to invest it in our future.

The cosy world we were told would go on for ever, where full employment would be guaran­teed by a stroke of the Chancellor’s pen, cutting taxes, deficit spending, that cosy world is gone. Yesterday delegates pointed to the first sorry fruits: a high rate of unemployment. The rate of unemployment today - there is no need for me to say this to you - cannot be justified on any grounds, least of all the human dignity of those involved. But Mr. Chairman and comrades, I did not become a member of our Party, still less did I become the Leader of our Party, to pro­pound shallow analyses and false remedies for fundamental economic and social problems.

When we reject unemployment as an economic instrument - as we do - and when we reject also superficial remedies, as socialists must, then we must ask ourselves unflinchingly what is the cause of high unemployment. Quite simply and unequivocally, it is caused by paying ourselves more than the value of what we produce. There are no scapegoats. This is as true in a mixed economy under a Labour Government as it is under capitalism or under communism. It is an absolute fact of life which no Government, be it left or right, can alter. Of course in Eastern Europe you cannot price yourself out of your job, because you cannot withdraw your labour. So those Governments can at least guarantee the appearance of full employment. But that is not the democratic way.

We used to think that you could spend your way out of a recession, and increase employ­ment by cutting taxes and boosting Government spending. I tell you in all candour that that option no longer exists, and that in so far as it ever did exist, it only worked on each occasion since the war by injecting a bigger dose of infla­tion into the economy, followed by a higher level of unemployment as the next step. Higher inflation followed by higher unemployment. We have just escaped from the highest rate of inflation this country has known; we have not yet escaped from the consequences: high unemployment.

That is the history of the last 20 years. Each time we did this the twin evils of unemployment and inflation have hit hardest those least able to stand them. Not those with the strongest bargaining power, no, it has not hit those. It has hit the poor, the old and the sick. We have strug­gled, as a Party, to try to maintain their stan­dards, and indeed to improve them, against the strength of the free collective bargaining power that we have seen exerted as some people have tried to maintain their standards against this economic policy.

Now we must get back to fundamentals. First, overcoming unemployment now unambiguously depends on our labour costs being at least com­parable with those of our major competitors. Second, we can only become competitive by having the right kind of investment at the right kind of level, and by significantly improving the productivity of both labour and capital. Third, we will fail - and I say this to those who have been pressing about public expenditure, to which I will come back - if we think we can buy our way out by printing what Denis Healey calls ‘confetti money’ to pay ourselves more than we produce. I do not care what economic system we live in - at least, I do care very much - but the moral I want to draw is this that whatever system we live under these fundamentals are at the heart of the standard of life of the people of the country concerned, and we ignore them at our peril. They are also at the heart of the Social Contract and of our industrial strategy.

Britain is now at a watershed. We have the chance to make real and fundamental choices about priorities which are absolutely necessary to achieve a growing and prosperous manufac­turing industry, with all the advantages and easements that can follow.

Let me be quite clear. If we did not possess the Social Contract and an industrial strategy that has been agreed between the Government and employers and trade unions, with all the socialist measures that are involved in that Contract and in the industrial strategy, if we did not possess this we would have no chance of forging a pow­erful British economy in the next decade. But we are getting co-operation on these issues.

The Manifesto was right when it said that the first priority of the Labour Government must be a determined attack on inflation. That remains; we have halved it in the last twelve months but we must do more yet. The Government’s objec­tive must be to reach inflation rates comparable with those of our major competitors by the end of next year. We are already getting there.

The regeneration of British industry has begun. The National Enterprise Board is in place and is in business. The Industry Act is working. The detailed examination of the 39 main sectors of British industry by employers and trade unions together has produced agreed reports on what is needed in each sector in the matter of new plant, new machinery, better use of existing plant, proper design, innovation, good marketing, after-sales services, increased training and skilled manpower to avoid bottle­necks. We know what needs to be done. Industry knows what needs to be done. Will both sides of industry now go through with it? If so, then we are at the beginning of a new era that will expand our so-far dwindling manufacturing base.

Let me add one more thing about how to get a strong manufacturing sector of industry. Hold on to your seats. The willingness of industry to invest in new plant and machinery requires, of course, that we overcome inflation, but also that industry is left with sufficient funds and has suf­ficient confidence to make the new investments. When I say they must have sufficient funds, I mean they must he able to earn a surplus and that is a euphemism for saying they must be able to make a profit. (Applause)

Whether you call it a surplus or a profit, it is necessary for a healthy industrial system, whether it operates in a socialist economy, a mixed economy or a capitalist economy. If industry cannot retain and generate sufficient funds as a result of its operations, and replace old plant and machinery, then you will whistle in vain for the investment and we shall continue to slide downhill. These are elementary facts of life. They are known to every trade unionist. Who would they sooner go and negotiate with when they want an increase in pay: a firm that is bankrupt or a firm that is doing well and generat­ing a good surplus?

The primary concern of our industrial strategy and our economic policy for the next three years is quite simple. The strategy and the priority is to create more wealth, and to do it with the agree­ment and the support of the trade union move­ment. Our social policy is concerned with the distribution of wealth. These two aspects of pol­icy should not be regarded as being in conflict, nor should we put them in conflict with each other. They must be harmonised. The wealth must be created before it is distributed. This is where I believe a misunderstanding, or perhaps something worse, has arisen between the Gov­ernment and the Party, on the question of public expenditure.

You know we have not been creating wealth as fast as we have been distributing it. Over the last three years you know that our domestic product has risen by 2 per cent and the increase in our public expenditure, including central and local government, has increased by 18 per cent. We have made shift to meet this, yes, by higher taxation at some points, borrowing from abroad and, worst of all, by printing money. Now we have to get back into balance again. Of course it cannot be done in twelve months. Our creditors understand this. Those with whom we discuss these matters in other countries understand this, because the disruption would be too great for the social system to bear. But it would be folly to continue to borrow at the present rate of £10 billion a year, even if we could find the lenders - and we are not always very polite to them. Whatever we do in the short term, the only long-term cure for unemployment is to create a healthy manufacturing industry that will hold its own overseas, and in doing so it will then certainly be able to retain its grip on the domestic market. It is by a healthy and expanding manu­facturing industry that we shall be able, in due course, to resume the growth and improvement of our social services and also create the jobs that are necessary if we are to reach what we all desperately require: our full employment targets.

Like everyone in the Labour Movement, I believe in a high level of public expenditure. But I part company with those who believe we can rely indefinitely on foreign borrowing to provide for greater social expenditure, a better welfare service, better hospitals, better education, the renewal of our inner cities and so on. In the end these things, comrades, are only provided by our own efforts.

Of course a Labour Government must not, and will not, stand by and do nothing about unemployment except wait for this agreed indus­trial strategy to succeed. As regards the matter of selective import controls, which was raised yesterday by a number of delegates, let me say that whether to introduce them or not has very little to do with socialist philosophy. It is a mat­ter of calculating where we get the biggest advantage. After all, I grew up in the days when import controls were the remedy of the Conservative Government. So it has nothing to do with socialism. It is a question of where we get the best advantage. Already various ways, of controlling imports exist in a number of fields. We shall continue to examine them case by case and I am already publicly committed to discuss the particular problem of Japanese imports with the European heads of State when we meet at The Hague in November. There will be a constant dialogue, I promise you, between the TUC and the CBI, the Government and the Party on this matter and action will be taken where it can be shown that it is to our net advantage. There is no philosophical block of any sort about that.

Mr. Chairman and comrades, in recent weeks, as some of you know, I have visited the North-East. I have been to Glasgow; I have been to Merseyside; I have been to the West Midlands. I have listened to some pretty straight talking about unemployment. I accept the criti­cism but I say in reply that there are no soft options, nor will a generation of decline in British industry be reversed by gimmicks. That is why, in asking for the Movement’s support for our present industrial strategy, I ask for more than your loyalty. That can be eroded. Indeed I can understand the circumstances in which it is. What the Government needs - what we all need - is your understanding and the conviction that will follow that understanding. Then let there be a determination to go out into the workshop, to go to the streets, to be on the doorsteps and to explain with passion to others why this is the only way for our Movement and for our country. We have a duty to fight for it. If we follow it in the end we shall save not only our Party, not only our Government. We shall save our coun­try.

Mr. Chairman, while our policy is working through, we have embarked on a succession of schemes aimed at alleviating unemployment wherever and whenever we can do so within the context of the overall strategy. In particular I emphasise, as Albert Booth and other delegates did yesterday, the need to try to alleviate the problem of youth unemployment. Unemploy­ment at any age is unacceptable but for a school-leaver it is especially demoralising, and those who leave at the minimum age of 16 need special help. Talking to educators, as I have done, and to employers who take on the school leavers, it has been put to me very strongly by both that there is still a real lack of contact between them. The machinery exists to provide this; it should be used in a more urgent and positive way. Two-way communication between schools’ careers advisers and employers must be a con­tinuous process, with full co-operation on both sides. The importance of hard thinking about this difficult transition that our young people make from the world of school to the world of work cannot be exaggerated. Much has been done and is now being done through the work experience programme and the great increase in the number of places provided for vocational training. There was a shaft of light last week with the fall in the number of unemployed young peo­ple. We expect this trend to continue. In addi­tion, the Job Creation Programme, the Tempor­ary Employment Subsidy, the remarkable increase in places for training, the Work Experi­ence Programme which came into force on Sep­tember 21, the Youth Employment Subsidy which comes into operation on October 1 are all helping to alleviate a serious problem. Then last Thursday Albert Booth announced the job release scheme in assisted areas, to begin on January 1 next, which will open up new em­ployment opportunities for younger unemployed people seeking work. There is to be a tax-free allowance of £23 per week to full-time men and women in assisted areas who retire and who are within a year of their respective minimum pen­sionable ages.

We shall continue with these efforts. We shall continue to seek out, with the co-operation of the unions and others, effective means of trying to reduce unemployment by selective action, taking special account of the position of young people. The wide variety of selective measures which we have now brought in will help about half a million of those without jobs in this period of exceptionally high unemployment. Travelling around the country, I have been much encour­aged to hear from teachers, from social workers, from the young people themselves and from employers that they value these measures as a very real contribution to the alleviation of this problem. But I repeat that none of these meas­ures, however worthwhile, are a substitute for a thriving economy generating full employment.

We are, we always have been, we remain a Party of social reform, and far more needs to be done to prepare young people for the time when they leave school. There should be much closer co-operation between employers and schools, and employers could do more to make their requirements known to teachers. Heads of schools could extend their sphere of interest to obtaining and acting upon the advice of local firms about their requirements. Firms could provide practical help of various kinds to local schools, and so discover how they could make better use of the actual and potential skills of school leavers. Personnel officers in industry could ask teachers to appraise their training techniques in industry. Co-operation in these ways would help industrial and commercial training to flow naturally from the last years at school. Some schools, perhaps many, need to give their careers departments more serious attention than they have done.

I am concerned at the gap that exists at many levels between education and industry today, not only at this level but at other levels too. Let us begin by helping our young people to fit themselves for life in their work, as well as in their leisure. Let us also, may I say in passing, take note and take account of the anxiety amongst parents at some aspects of the education of their children. I have been in a number of schools which have impressed me deeply by their inno­vation and their experiment. There are new ways of learning that were unknown to us, vou­ched for by the teachers. This is good. But let me emphasise that the greatest gifts a teacher can give to a child are the basic tools of learning and a desire for knowledge. A literate and numerate child has the key to open the door of learning and the key to the freedom of the mind.

Let me turn to another aspect of our modern society: freedom. Democratic socialists em­phasise that a fundamental aspect of freedom is the freedom of minorities within our society. Freedom from discrimination. There can be no equivocation, and there is none in the Labour Movement, on racial matters. We must oppose all forms of racial discrimination in this country and fight the messages of hatred which are designed to divide people from each other. (Applause) The Party has taken up the chal­lenge. We shall fight, we shall continue in the way in which we have begun on this matter. Once he or she has been accepted for settlement in our country every newcomer has the same rights and obligations as everyone else. We wish them to make as real a contribution to the coun­try as other immigrants have done throughout our long history, and the new Race Relations Bill currently before Parliament aims to help them do that. As to the numbers who come here, I have never wavered from the view that in a small and highly-populated country there is a limit to the number of immigrants we can absorb. Therefore strict control over immigration is necessary, subject to honouring our commit­ments, and Britain will do that.

Next, a word about devolution, an important constitutional development which we will dis­cuss later this morning and to which Michael Foot will reply. Will you allow me to say how deeply I appreciate the support of Michael who, in the interests of the unity of our Movement and our Party, has put aside his personal feelings in order to help our Party and the Government. The debate on devolution will go on - it is going on now - but it cannot continue indefinitely without being brought to a conclusion. There­fore we shall ask Parliament next Session to enact the necessary legislation so that our pro­posals will be on the Statute Book in the course of 1977. Parliament has plenty of time to debate the Bill, but Parliament owes it to the people of Scotland and Wales to reach a definite and a favourable conclusion on the matter. (Applause) At the end of the process Parliament must be able to offer the people of Scotland, and of Wales, a real and substantial measure of control over their own affairs within the overall framework of the United Kingdom. What we will not create is a half-way house to separation, to which the vast majority of the people in these islands are totally and completely opposed. (Applause)

I have been around a long time, some of you will think too long. My political instinct tells me that the successful implementation of devolution offers us, as a whole, the best way of keeping the United Kingdom united, while at the same time enhancing the vigour of national diversity within these islands. I know that these proposals have raised questions in the minds of our local author­ity members in the English regions. Yes, we shall look at those with some care. I know some of them arise because of the disillusionment with the expensive and bureaucratic local govern­ment structure foisted on us by the last Tory administration. (Applause)

As to the continuing tragedy of Northern Ire­land, I am sure that the whole Conference would like me to express our heartfelt thanks and admi­ration to Merlyn Rees for the way he has carried out his responsibilities during 2½ years. (Applause) Roy Mason has now inherited this awesome task. He will carry to the hard-pressed people of Northern Ireland the same message: that the Government will use its best endeavours to put an end to the violence and to achieve a political solution there. Let me repeat - because some things have to be said time after time after time - that there will be no economic and no political withdrawal. The situation has been improved by stopping the use of detention in Northern Ireland. What is now needed is a rigorous determination by everyone that the rule of law shall prevail there and that no one shall be exempt. In that the Government needs the full co-operation of all the people themselves. This has recently been illustrated by the spontaneous Women’s Peace Movement, which I welcome. (Applause) Let us not forget in this forum another group which has maintained a consistent non-sectarian stand throughout all these difficult years. I refer to the Northern Ireland trade unions. (Applause) We make clear once again to the men of violence that we are not to be intimi­dated into abandoning our duty to all the people of the Province.

Without pre-empting our debate next Thurs­day, I should like to mention briefly some recent developments in Southern Africa. The announcement on Friday evening by Mr. Smith of his acceptance of the principle of majority rule within the two-year time scale that I laid down on March 22 last, could be an historic turning point in the future of the sub-continent. For Bri­tain a solution in Rhodesia on the basis of major­ity rule is a debt of honour. For Africa, without it, there is a constant threat to peace and to stability. I should like to put on record my thanks to Secretary Kissinger for his charac­teristic and remarkable contribution to recent developments. (Applause) Without the decisive intervention of the United States there would not have been this turnabout in the attitude of Mr. Smith.

In the last few days I have been in contact with the four African Presidents who have them­selves made a remarkable contribution to the search for a peaceful settlement: Their response to Mr. Smith’s broadcast last Friday has been a tough one. That is not surprising, considering the history and considering the suspicion that arises from the history. But the prize within our grasp is an interim government with a black majority and majority rule within two years. That must be preferable to an increasingly viol­ent armed struggle in which thousands of inno­cent men and women on both sides would lose their lives. The Labour Government wants to see an interim government set up rapidly, say within four to six weeks. We will play a full and active part in promoting such an end. The meet­ing to negotiate the interim government need not necessarily be held in Salisbury or elsewhere in Rhodesia. The Foreign Secretary, Tony Cros­land, is prepared to back the convening of negotiations in any place convenient to the par­ties concerned. But the essential ingredient is the rapid establishment of the interim govern­ment. Once that has happened there will be no going back. The die will then be cast. There will be difficulties in the months ahead, but if the forthcoming negotiations can be brought to a successful conclusion, then Britain will at long last have discharged her last colonial responsibil­ity in Africa with honour.

The borders of our Movement’s concern have never been drawn at Dover. When the Govern­ment is attacked about cuts in public expendi­ture at a time of great economic difficulty, let me remind Conference of what has not so far been mentioned; that the Government left untouched our aid programme to the poorer countries. We have in no way withdrawn from any of our responsibilities to them. (Applause) We still take upon ourselves the task of assisting those who are burdened, the two-thirds of mankind who are burdened by poverty, ignorance and disease.

I regret that some of the momentum of the dialogue that was opened up by Harold Wilson at the Commonwealth Prime Ministers’ Confer­ence has been lost for the time being. I believe this will not persist. We will do all in our power to ensure that the response of the industrialised world in the north/south dialogue is a construc­tive one.

We shall also use our influence to promote a more constructive dialogue in East/West rela­tions, in the search for increased international security. Incidentally, we should not assume that we are alone in our troubles. Eastern Europe and the Soviet Union have their economic problems too. We wish to see an expansion of economic activity in East/West trade. I do not accept the arguments of those who say that such a growth will serve only to assist the expansion of Soviet armed strength. There is no doubt that the Soviet Union has built substantial armed forces but nevertheless our analysis is, and this is accepted by a great many people outside this country, that the develop­ment of economic relations can increasingly involve the Soviet Union in a more stable and beneficial relationship with the West which it will not be in their interest to disturb. This is the policy of detente, and as signatories to the Hel­sinki agreement we regard it as essential that its implications should be accepted in all the fields of economic relations, cultural exchanges and human relations as well. We have in common with the Soviet Union the desire to avoid the horrors of war. We proceed on the assumption that the Soviet Union is in earnest in its wish to improve relations between states - I emphasise the word ‘states’ - even though, as their own statements have told us, the ideological struggle will continue between parties. Let there be no doubt about their intentions on that.

Finally, let me turn to our domestic Party affairs. In the media I am often dubbed a Party man. Indeed, it seems that to be loyal to your party is the worst possible thing the media can say about you. I accept the description as an accolade. I am only too well aware that the strength of this Government rests on the Party. Without the Party none of us would hold the office we do. That is why I want the closest possible relationship between Party and Gov­ernment. But it must be based on a mutual respect and a recognition of each other’s respon­sibilities.

To tell the truth, I believe the relationship which has grown up between the TUC and the Government in the past two and a half years has developed faster than the relationship between the Government and the National Executive Committee. (Applause) This should not be so. It is not of my seeking. Every member of the Cabinet, every member of the Government knows that he shares the responsibility to estab­lish close relations with the National Executive Committee and its study groups, as well as with the Parliamentary Party itself. I do not want to retreat behind the stock defence that ‘the Gov­ernment must govern,’ if that becomes a polite way of telling the Party to go to hell. But the NEC must remember, too, that they are respon­sible. Yes, they are responsible for their statements and their resolutions. But the Govern­ment is accountable for its actions and that is the difference between us. (Applause) We are accountable in a parliamentary democracy to Parliament. Parliamentary candidates who offer themselves to the electorate on the basis that they are willing to suspend their judgment in favour of extra-parliamentary bodies, whoever they may be, will receive short shrift from the electorate. Of course Members of Parliament must be sensitive to the views of their general management committees. I tell you that they are. I know that, from what they say to me about the attitudes of their own GMCs. There is a two-way traffic between the two. Of course they are influenced. But Parliament has to take deci­sions by their votes; that is where they are responsible.

There are many aspects of our Party demo­cracy that could be looked at with advantage. Is the Party really satisfied with a youth movement which has only half the branches it had ten years ago, and which is increasingly dominated by a single brand of socialist sectarianism? (Applause)

Could not the National Executive Committee itself reflect the Party better, if it included local government representatives and perhaps rep­resentatives of the regional councils?(Applause) I also draw the Party’s attention to a new factor creeping into the Party, which I warn against - namely those elements who misuse the word ‘socialist’ and who seek to infiltrate our party and use it for their own ends. (Applause) They are almost always recognisable by their jargon and by their intolerance. They are as much the enemy of the Tribune Group as they are of the Manifesto Group, or even of the great majority of us who do not happen to belong to either but are simply ordinary members of the Party. The main bulwark against this infiltration is a strong and active membership in every constituency, for these people represent only a small group. But I do suggest to the National Executive Committee that they could do well to examine these activities, see what is going on and report back to the Party.

I raise these matters, not because I am on a witch-hunt but because I want the Government and the Party to work closely together. To do that the Party must be strong and representative.

Much good work has already been done. I very much welcome ‘Labour’s Programme 1976.’ It has involved the work of hundreds of volunteers, as well as members of the NEC and our hard-working staff at Transport House. I am sure that neither they, nor you, will expect the Government, dealing as we have to with the day-to-day realities of the situation to simply swallow whole and undigested the 147 pages of ‘Labour’s Programme 1976.’ A dialogue will be necessary and it will not just be carried on by monthly resolutions, or a steady stream of press releases from the National Executive Sub-Committees. To be successful it will require mutual respect, mutual trust, a recognition of our differing roles and our separate respon­sibilities. That is my desire and it is in that spirit that I invite the National Executive to join us in planning ahead. If we can approach it in this way the Government will be more sensitive to the Party's wishes and the Party’s deliberations will have a sharper cutting edge from being more closely involved in the realities of decision-making.

We began as a Party of protest. We must never lose that, never forget it. There are many ills and many evils in the condition of our society that have still to be remedied. But we are more; we are now a Party of Government, a Party which has put many of the aspirations of the pioneers on the statute book, as the law of our land.

I conclude my Report. Inevitably it has dealt with many varied issues and problems, some of them I regret to say in not as detailed a way as I should have liked. But Derek Gladwin said to me last night ‘Keep it as short as you can.’ What I would like to emerge from it is that the Government is willing to tell the people the truth, willing to consult with the Party, willing to work with the trade unions and with the people to solve our national problems. That is the philosophy of the Social Contract. Do not listen to the faint-hearted. Have confidence. The Labour Movement has the responsibility. Now let it prove that it has the maturity to lead our country and our Party to a new future. (Applause)

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