John Major’s Policies

Economy

John Major wrote on the economy, “As I left office the figures told the story of the fall and rise of the economy. On the day I became Prime Minister the tax burden was 36.3% per cent. On 1 May 1997 it was 36.6 per cent, which, over the span, puts our tax record in a proper perspective. During my premiership interest rates fell from 14 per cent to 6 per cent, unemployment was at 1.75 million when I took office, and at 1.6 million and falling upon my departure; and the government’s annual borrowing rose from £0.5 billion to nearly £46 billion at its peak before falling to £1 billion. The economy was growing by only around 0.5 per cent in 1990, shrinking by 1.5 per cent in 1991 before recovering to grow by 3.5 per cent in 1997. During the depths of the recession I inherited, all the economic indicators worsened, but they had all been corrected by May 1997. Above all, we had broken the inflation psychology that had so bedevilled our economy. In November 1990, the rate of inflation was 9.7 per cent. In May 1997 it was 2.6 per cent. It was a fine legacy”.

European Exchange Rate Mechanism (ERM):

John Major wrote on the ERM, “We entered the ERM to general applause, and left it to general abuse. Yet membership turned Britain into a low-inflation economy. For thirty years, under every Prime Minister from Harold Wilson to Margaret Thatcher, inflation had drained away at intervals, only to flood back like the tide. In the autumn of 1990, before we joined the ERM, inflation was at double figures. After a year of membership, retail price inflation was less than 5 per cent; by June 1992 it was heading down still further – 4 per cent that month, and 3.5 per cent in July. We entered the ERM to curb inflation, and had done so. I was certain that it was vital to Britain’s long-term future that for once we did not let it creep back.”

“The ERM was far from the suffocating economic blanket caricatured by those with a political axe to grind. As a book by the respected economist Christopher Dow argued in 1998, Britain’s economic troubles in the early 1990s were a result not of the ERM but ‘the rebound from the previous boom psychology’. Our trade performance was improving before ‘White Wednesday’ as the Euro-sceptics dubbed it. We were climbing out of recession. The ERM was the medicine to cure the ailment, but it was not the ailment – and no amount of rewriting history can honestly make it so”.

Major argued that the ERM overall had been a success for the British economy, and succeeded in lowering inflation. Referring to the years of inflation during the Thatcher Government, Major wrote about the period when Nigel Lawson was Chancellor of the Exchequer, “Margaret Thatcher knew that an increase would have been seen as the economic price to be paid for her political dispute with Nigel, so she naturally agreed with my decision wholeheartedly. In any event she wanted interest rates down, not up. It was ever this in the latter years of her premiership – the anti-inflationary ‘Iron Lady’ is a myth.

European Union:

John Major inherited a Conservative Party in crisis over the subject of our membership of the European Union. Margaret Thatcher had signed the Single European Act in the 1980s paving the way for progress towards to European harmonisation, but in the late 1980s had embarked on a policy of Euro-scepticism partly leading to the resignation of the Deputy Prime Minister and Chancellor of the Exchequer. John Major embarked on a policy of standing back from European integration and the single currency but seeking to lead the debate on the future of the Union.

Major wrote, “I made it clear that I would bring forward our proposals to Inter-Governmental Conference (IGC) at Maastricht, since I didn’t like what was on offer. The essence of my message was perfectly clear, but the ‘heart of Europe’ ambition persuaded the Euro-fearful that I would accept federalism. This was such copper-bottomed nonsense that I dismissed it as a serious criticism. Could anyone with a grain of sense wish us to be on the outskirts of Europe while others decided policy that affected Britain? I thought not. It seemed self-evident to me that if we were to stay in Europe, we had to be at the heart of it to protect our own interests. if we let others dominate the debate we would be forever on the back foot. This logic made no impact. The myth was created that I was too Euro-friendly, and my speech was used as a distorting mirror in which everyone could see what they wished to see.”

Major added that, “I did not wish to see a single currency. My objections were both economic and political. I could see the advantages of one large, powerful anti-inflationary currency offering a strong bulwark against market turmoil, with Europe-wide low interest rates and transparency in pricing; the benefits of such a currency were obvious to anyone prepared to examine the matter dispassionately. But it was all too early. The nation states of Europe were far apart in economic efficiency and development. They needed to see how well and how swiftly they could converge economically before they considered a move to one pan-European currency. I had a second objection: enlarging the Community to include the Central and East European nations seemed to me to be a debt of honour. We had left them under Soviet dominion for fifty years, and an early move to monetary union would be likely to delay their entry as the community concentrated on EMU. And, even when they joined, the new members would not be remotely ready to participate in the new currency.”

“Nor did I like the political implication of monetary union, which I believed would be untenable in the UK. A single central bank and a unified monetary policy would remove key economic policy options from the government and Parliament. It would give rise to demands for harmonisation of taxes (no doubt, upwards) and destroy the UK’s hard-won competitive advantage of low taxation”.

Maastricht Treaty Dispute

John Major had put Britain’s ideas on how best to frame the proposals to the IGC, as mentioned above. The Maastricht debate in 1991, gave as Major said, “I set out our negotiating aims with great care. No federalism. No commitment to a single currency. No Social Chapter. No Community competence on foreign or home affairs or defence. Cooperation in these areas, yes, compulsion, no. It could not have been clearer. I set out too what we hoped to gain at Maastricht. More power for the European Parliament to control the Commission and investigate fraud. A more open Community that enlarged its borders to the east. Treaty acknowledgement of ‘subsidiarity’ – the principle that Europe should only do what the nation state could not do equally well – so that we could end the creep of increasing Commission power. I proposed power for the European Court to impose a level playing field for industry to prevent abuse of the single market. At the end of the debate I received a majority of 101, with only six Conservative MPs voting against.”

There was little criticism of the Maastricht Treaty, and it was said by some observers that Major had argued a stronger position for the United Kingdom than might have been achieved by the Thatcher administration. The country gave Major a mandate in 1992 to pursue Maastricht, and he gave the European Commission the agreement that the United Kingdom would sign up to the Maastricht Treaty. It was only after the 1992 General Election that internal party dissent began, leaving Major little or no negotiating position.

Major wrote about the internal disputes in the Conservative Party, “Worse was to come. On the penultimate day of the [1992 Conservative Party] conference, Margaret Thatcher published an article in the European, a now-defunct newspaper, in which she claimed that ‘Maastricht will hand over more power to unelected bureaucrats and erode the freedoms of ordinary men and women’. The sub-text was clear; she would not have agreed Maastricht, whereas I had. She would have protected the ‘freedoms of ordinary men and women’, whereas I had not. Coming as it did on the eye of my own speech to the conference, the article was perfectly timed to inflame opinion and play to the Euro-sceptic gallery. It was also in stark contrast to how Margaret would have acted in office. She would have signed the Treaty of European Union had she still been prime minister, and every official and minister who had worked with her knew it.

Education:

Education was one of John Major’s key priorities, and was the backbone (along with crime and health) of his “back to basics” policy. He wanted a better provision for nursery education (see section below), an extension to the assisted places scheme so that good education in the private sector was accessible to all, an independent inspections system, the opening up of league tables to monitor performance in schools and to give parents choice. Major’s administration also saw an increase in the number of grant maintained (GM) schools, which looked over their own budgets. By 1997, 1,100 schools opted out to gain GM status and one and a half million parents had voted for their school to go GM. Labour reversed this policy in 1997 following their General Election victory.

Major wrote in conclusion, “If schools are delivering the goods, let them opt out. Let parents and teachers choose. Give parents the resources to provide their children with the education they want, where they want. Remove controls on the size of existing schools and the locality of new ones. Education should have no fear of freedom, and no fear of choice. The state must ensure that information and choice are free, and that the weaker schools are not permitted to fail their pupils. But I believe that true responsibility must go back where I always wanted it go go – to the individual school”.

Education (Nursery Schools):

John Major put particular emphasis on nursery education. He wrote, “As economic recovery gathered pace after 1992, I returned to the issue of nursery education. I wanted it available for all four-year-olds by 1997, and to extend it to three-years-olds thereafter. There was a ferocious battle in Whitehall when my intentions became clear.  The Treasury was alarmed at the resource implications, and the Department of Education did not see nurseries as a central priority. Nonetheless, again to widen choice, I decided to go for an education voucher – a sum of money given directly to parents to help pay for a place for their children in nursery school. This voucher could be spent in either the public or the private sector, and would have equal value in each. Vouchers were introduced on a pilot basis in 1996 and nationally in 1997. Parents of nursery-age children were given £1,100, and an equivalent sum was deducted from the spending allocation of each education authority. Before the infant voucher system became accepted, the election was lost, and the new government strangled the scheme. There were few protests. Parents had not become used to the new system, LEAs were hostile even as they exploited it, and the private sector was slow to see the advantages it offered.”

“What has followed was all too predictable. LEAs took over nursery provision. Bureaucracy and regulation have redoubled. Many private and voluntary providers have simply withdrawn. OFSTED has found that standards in LEA reception classes are generally far lower than in the private and voluntary sectors. We have what I wanted – universal availability of nursery education. But it is not as I wanted it. Choice has been stifled. Regulation is rife. Standards are not what they should be”.

Northern Ireland:

John Major wrote about the situation in Northern Ireland when he took office, “The hatred and feuds of Northern Ireland forced their way into forefront of my mind. It seemed to me our nation had become so weary of this ever-present scar that people were now willing to accept that nothing could be done. I was not. I believed in the politics of reason, and was intent on working for a settlement that would end the violence, and – unless the people of the Province chose to leave it – keep Northern Ireland within the United Kingdom”.

John Major wrote that after 1990 he received information from Sinn Fein’s leaders Gerry Adams and Martin McGuinness that they would be interested in a dialogue on the situation in Northern Ireland. As talks with a terrorist organisation were very sensitive, tentative discussions were started, with a minimum number of people involved to reduce the risks of any leaks. John Major said to the Republicans that the process could be started that could end up in a united Ireland, but only if this was the clear wish of the people of the Province.

The process of dialogue led to the Downing Street Declaration and was picked up by Tony Blair following Labour’s victory in 1997. In 2005 the IRA handed over their weapons and power in the Province is now shared between the political parties in the Northern Ireland Assembly.

Health Service:

John Major believed that the Health Service should enter a period where the reforms of the 1980s were continued, where a Citizen’s Charter would be introduced to give patients an expectation of their rights, and for more public spending to be made available to the Health Service. In his book, Major writes, “There were cash increases from 32.6 billion pounds in 1991/1992 to 42.6 billion pounds in 1996-1997. Two and a quarter million more in-patient and day cases were treated in our hospitals each year than in 1990. The number of cataract operations had risen by sixty thousand in five years. The agony of long waits for surgical treatment was almost eliminated. In the Tory years as a whole the number of elderly people given a new lease of life by a hip replacement doubled; heart transplants became an almost daily event, as opposed to a national headline; nurses’ pay rose by two thirds, and the average doctor, even allowing for price rises, took home in earnings £175 pounds for every £100 he or she had earned in 1979.”

Transport:

The main area of development in John Major’s administration was a slow down in the road building programme and progress towards an increase in public transport. He did that by firstly introducing minimum standards via the Citizen’s Charter, and then subsequently in the privatisation of British Rail. In the years since the privatisation there has been a large increase in investment in the service and substantial increases in passenger numbers and freight usage.

John Major wrote, “It was an error of historic proportions for the Labour Party – from Michael Foot to Tony Blair – to have resisted, as they did, every single privatisation. To give one example, hundreds of millions of pounds more could have been raised in the market for improving our railways if Tony Blair and Clare Short had not raised the foolish, but in 1996 all too credible, spectre of renationalisation. Mr Blair now blithely tells us he never intended to carry out that threat, in effect, that it was just so much more characteristic candyfloss to gull the Labour Party faithful. it did not seem so at the time”.

Back to Basics:

The media often reported that back to basics was Major’s moral crusade. It was in fact his vision to return to traditional values in education, the economy and in health. At the 1993 Conservative Party conference, Major said, “The message from this conference is clear and simple, we must go back to basics. We want our children to be taught the best, our public services to give the best, our British industry to be the best and the Conservative Party will lead the country back to those basic rights across the board.  Sound money, free trade, traditional teaching, respect for the family and respect for the law. And above all, we will lead a new campaign to defeat the cancer that is crime.”