David Cameron: "We're going to be extremely tough"

On Sunday 3 October Andrew Marr interviewed Prime Minister David Cameron.

Please note 'The Andrew Marr Show' must be credited if any part of this transcript is used.

ANDREW MARR:

Now I'm going to be joined by a man who probably would contest that he is paid more than he's worth, I'm sure - by the Prime Minister himself, David Cameron. Welcome, Mr Cameron. This is the first party conference in 14 years when the Conservative Party has actually been in power, which is quite a thought, and yet there are a fair number of people around inside the Conservative Party who feel that really you ought to have won the election outright. Four months on, any reflections on why that didn't happen?

DAVID CAMERON:

Well we had a huge mountain to climb. I mean even with the result that we got, we won 100 seats. It was the best result for us in terms of new seats since 1931. It was a big mountain to climb. I was hoping we were going to get to the top on our own, but we didn't. And in life you have to play the hand that you're dealt, and I think the Conservative Party has responded very well to the circumstances and we've come together with the Liberal Democrats. We've put aside political differences and formed a government in the national interest that's actually, I think, getting on, dealing with the problems that we have in this country, but actually being quite bold and radical in building a stronger, better country for everyone. So I'm very enthusiastic about what so far we've been able to do.

ANDREW MARR:

Are there positive advantages in coalition?

DAVID CAMERON:

There are some advantages. I mean, look, I would have rather won outright. I mean that was what I spent the last four and a half years of my life trying to do.

ANDREW MARR:

(simultaneously) Trying to do, yes.

DAVID CAMERON:

But one advantage is that because we're in partnership and in coalition, it does take government off from the sofa and it gets it round the cabinet table where you have really good and proper discussions like on national security and defence, like on the deficit, like on welfare, and you have to go through the arguments in a proper, collective way, as government's meant to be done. And the interesting thing so far is that I think we're showing you can come up with some very radical answers. If you take welfare reform, what we are putting forward is the most radical reform of the welfare state since Beveridge for sort of 60 years. I think it will have a transformative effect on making sure that everyone is better off in work and better off working rather than on benefits. And that's a great thing we can do for our country and for the very poorest people in our country too.

ANDREW MARR:

Sure. I'd like to spend, as you suspected I would, quite a lot of time talking specifically about that, but …

DAVID CAMERON:

(over) Yeah, I just wanted to make that point, yuh.

ANDREW MARR:

I mean I was very struck by for instance Michael Gove, one of your key lieutenants, saying actually that you know he had learned some important things from his Liberal Democrat colleague minister about the pupil premium. Then we get Caroline Spelman saying actually she really enjoys working with Liberal Democrats. And I'm wondering whether you also would accept that they have got some arguments which the Conservative family hadn't got quite right, and that there is a two-way …?

DAVID CAMERON:

Well different people bring different perspectives, and different political traditions bring different perspectives; and, as I say, we then argue these things out round the table. And that so far has been very positive for the government and I think we're providing good government. But it requires people to be reasonable and rational, and what I find with Nick Clegg is that he is intensely reasonable and rational and actually we work very much together in a partnership government to try to reach the right conclusions. But you …

ANDREW MARR:

Do you like him?

DAVID CAMERON:

I do, we get on, and that's good. But I think the interesting thing in a way - if you think back to the last government, there were endless arguments about who liked who and who was getting on and the wars were about people and personalities and who's got the biggest office and who's going to have my job next and all the rest of it. We're not arguing about that. We're arguing about the future of the country, the big issues - how we defend the nation, how we reform the welfare state, how we have a better health service. And that is a good thing.

ANDREW MARR:

You see the reason I ask about this is that Nick Clegg goes to his party conference and there's a lot of Liberal Democrats going around rather grumpily saying, "Nick Clegg's getting on better with that David Cameron and those Tory ministers than he gets on with some of us. We think he likes them more." And then you come to the Conservative Party conference and people are saying as it were the same sort of thing: "David Cameron, he's more of a Nick Clegg politician than he's a Norman Tebbit politician. It's his natural instinct."

DAVID CAMERON:

I think people … the Conservatives are coming here to Birmingham with spirits high because they can see a government that is delivering for the Conservative Party. We have put in place you know the referendum lock, so we can't pass more powers to Brussels; we will have the immigration cap; we got rid of Labour's jobs tax. People can see this is delivering for the Conservative Party. But both Nick and I take the same view, which is this shouldn't be a government where we both try and just parade some baubles that we've got out of it. We both want together to make the difficult decisions but the bold decisions about building a stronger country.

ANDREW MARR:

So if …

DAVID CAMERON:

And I think that's very … I thought Nick in his conference speech was brave and should be praised for that. That he was actually saying look, I want to own the difficult parts of this government as well as the concessions I've been able to get …

ANDREW MARR:

(over) I'm not going to come to you and say …

DAVID CAMERON:

(over) … for the Liberal Democrats. And I think that is, I think that's quite important.

ANDREW MARR:

And so does that mean when I say to you in terms of kind of traditional, quite hardline Conservatives who are looking for some red meat from you this week in Birmingham, that's the wrong kind of question; I'm not going to toss them that kind of stuff?

DAVID CAMERON:

Well I think the Conservatives, who fought very hard in the election campaign, I think you know people who are out on the streets can actually see big parts of our manifesto being delivered, as I've just said. But I think also if you ask Conservatives, people who vote Conservative what really matters to you more than anything else, I think those two words 'national interest' would spring out. And I think the reason why the Conservative Party has responded so well to this government is they see that we are coming together in the national interest, taking difficult decisions for the long-term good of the country. And people have often said why can't politicians put aside their petty differences and do something worthwhile together? Well actually that's what we're trying to do and I think that's why the response is so positive.

ANDREW MARR:

Well let's come onto some of the meat. Ken Clarke in the Observer today is admitting that there is indeed a possibility of a double dip recession. If the Bank of England and the Treasury and economists come to you and say, "Listen, the economy is weaker than we thought it was. Unemployment is rising much more quickly than we thought. We've got problems in the housing market. We are heading for a serious recession", is your policy flexible enough to change direction?

DAVID CAMERON:

Well of course you have to respond to the circumstances that you face, but the overwhelming set of circumstances we face is that Britain's budget deficit is something you can't put off dealing with. It's like a credit card bill for a family in the way that the longer you leave it, the worse it gets. And what George Osborne's budget did back in June was to take Britain out of the danger zone. We were linked with you know Portugal and Greece and Spain as countries that were at risk of a credit downgrade, of interest rates going up. We've taken Britain out of that danger zone and our interest rates have actually come down.

ANDREW MARR:

Like the Irish, we were jolly tough, and the Irish are now in deep trouble. I'm saying it's not necessarily a black and white thing.

DAVID CAMERON:

No, of course.

ANDREW MARR:

It's a matter of timing and nuance.

DAVID CAMERON:

Absolutely. But the key thing that George Osborne and Ken Clarke and I all discussed before the election was that the right stance was to deal with the deficit, the problem facing Britain, and at the same time that allows the Bank of England to keep monetary policy and interest rates relatively expansionary. And that's the right mix of policy and at the moment that is very much what the Bank of England and others are saying. I mean we've given up the right to issue our own economic forecasts.

ANDREW MARR:

Yes, indeed.

DAVID CAMERON:

We've given it to the Office of Budget Responsibility …

ANDREW MARR:

Do you agree with Ken Clarke?

DAVID CAMERON:

… and they forecast that there'll be growth in the British economy. Of course it's going to be choppy.

ANDREW MARR:

Do you agree with Ken Clarke that we could go into a double dip recession?

DAVID CAMERON:

Well if you read what Ken is saying, Ken is talking about the fragility of the Western economies after the deep recession and the banking crisis, and it's not surprising they're fragile. That's the point that he's making. And all of the …

ANDREW MARR:

And thus we do face the possibility of a double dip recession.

DAVID CAMERON:

I look at the forecasts - the forecasts from the Office of Budget Responsibility, from the CBI, from others. They forecast growth for the British economy - but, yes, it will be a choppy period that we're going through. But you've got to remo… But the biggest risk …

ANDREW MARR:

(over) Just one last on this one. If we did go into recession, would there be a case then for delaying some of the public spending cuts?

DAVID CAMERON:

Well I don't believe in positing all sorts of you know conditional questions about the future. We have to react to the circumstances we see. The biggest circumstance we inherited was an unaffordable budget deficit that threatened Britain with higher interest rates, that threatened us with a credit downgrade, and that is racking up extra interest bills at a rate of £120 million a day. It is irresponsible to do nothing about that. And since we've taken the steps to do something about it, our interest rates have fallen, which actually helps business to invest. That's actually expanding the economy. And this idea that you help confidence in your economy by putting off difficult decisions is nonsense. I had …

ANDREW MARR:

Right, well let's take some of those difficult decisions which have been discussed widely in the papers today - above all this idea of a single universal benefit. First of all, can I confirm that this is going to cost money to put it into place - the Iain Duncan Smith plan to get people back to work with a single benefit replacing all of the complex ones and the mechanisms to help people get back to work. That costs money upfront now.

DAVID CAMERON:

It does cost some money. We are …

ANDREW MARR:

And you've agreed to spend that money.

DAVID CAMERON:

We are going to … We're phasing this in because it's a hugely ambitious plan. At its heart, it's very simple. We spend billions of pounds on welfare in this country. The bill's been going up and up and up and yet millions of our fellow citizens are trapped in poverty and it's not worth their while working. You might remember at my conference speech last year, I raised the case of a single mum earning a few hundred pounds a week, and if she tried to work more 96 pence in every pound was taken away from her. That's wrong, that's outrageous. And what this benefit change does is put together all of these out of work benefits and the tax credit system and then gives you a credit which is withdrawn at a rate, so it's always worth your while working or doing more work …

ANDREW MARR:

And it's a single benefit for everybody?

DAVID CAMERON:

That's right.

ANDREW MARR:

So no more invalidity benefit, unemployment benefit, this benefit, that … One benefit?

DAVID CAMERON:

Basically it takes the means tested benefits, most of the means tested benefits in the tax credit system and over time everyone migrates onto this system. So it is a big, bold change; it does cost some money upfront. We are seeking general welfare savings in order to pay for it. We'll be making announcements about those on 20th October. But over time it has the capacity to save huge amounts of money because it'll end a lot of the fraud, a lot of the error, a lot of the waste. And because it's always worth people going into work, you'll actually reduce benefits. We all know cases at the moment where you know you meet someone who's desperate to work, but if they work they lose their housing benefit …

ANDREW MARR:

Sure.

DAVID CAMERON:

… they lose the council tax benefit, and they just ask is it worth my while working? So this …

ANDREW MARR:

So it will always …

DAVID CAMERON:

One another thing, which is very tough conditionality; that you know if you can work and if you're offered a job and if you don't take it, you cannot go on claiming benefits. We're going to be extremely tough.

ANDREW MARR:

Half a million people on invalidity benefit who could actually work. Would you accept that figure?

DAVID CAMERON:

I think look a lot of figures get bandied round, and I think when you look at the invalidity benefits there are three groups: the people who absolutely cannot work, who really need to be supported and as a compassionate country we should do that; there are those who could work and should work and we'll make sure they do work; but in the middle there are a lot of people who would like to work, but who need a lot of help. And one of our arguments is that, look, it's time to open up the system and get the private sector and the voluntary sector and organisations of the big society - as I call it - to come in and help those people who want to work, but who need serious tailored help to get them over the barriers that they have in their lives.

ANDREW MARR:

It all sounds very good, but I have to say, ageing man now, I've sat over the years and heard politicians of different parties say pretty much the same thing and, frankly, not much has happened. So are you able to say to me that by this time next year, you will have got substantial numbers of people who are now on benefit back into work?

DAVID CAMERON:

I believe that is the case. But this is going to take a long time to bring this whole change in because you are migrating people off a whole range of different benefits and tax credits that have become incredibly complicated onto one single universal credit system. So it will take time, but we have …

ANDREW MARR:

(over) Will people lose benefit? I mean will there be substantial numbers of losers?

DAVID CAMERON:

Well no, there won't. In the way that we're introducing it and doing it over time does mean that there won't be losers. But what it does mean is once it's up and running …

ANDREW MARR:

So how do you pay for it? If there aren't losers and it's this massive part of what the state spends and you have to get spending down, how do you square that?

DAVID CAMERON:

We've reduced the cost by introducing it progressively; and the second thing is we will be making savings in the welfare budget. We made savings in the budget and we'll be doing more.

ANDREW MARR:

(over) So when the papers say today that for instance you could remove child benefit at 16 and you could remove Education Maintenance Allowance, those are the kind of things that could be used to pay for this?

DAVID CAMERON:

Well I'm not going to speculate today about it because obviously we're in a process where we've got you know nineteen days to go before the spending announcement.

ANDREW MARR:

So these decisions haven't been taken? Or have they been taken?

DAVID CAMERON:

There are lots of decisions we're looking at in terms of … And the truth about our spending problem is that one pound out of every three is spent on welfare …

ANDREW MARR:

(over) Exactly, so you have to get that bill down.

DAVID CAMERON:

… so if you want to … You have to deal with the extent of welfare dependency in this country if you're going to get the budget deficit under control and if you're going to have a system that encourages work.

ANDREW MARR:

If you're not going to talk about details - and I understand that - what about the philosophical question? On the one hand you've got those people who say that a welfare state must have universal benefits that go to everybody, no matter how rich or poor, so that everybody buys into it. And on the other hand, you've got people who say well actually no, when times are tough it's bonkers that there are wealthy people getting all sorts of allowances and free bus passes and child benefit they don't actually need. And you know the stories as well as I do. Which side of that argument are you on?

DAVID CAMERON:

The truth is I think we have to do both things. On the one hand, we've got to ask are there some elements of universal benefits that are no longer affordable? But, on the other hand, let's look at the issues of dependency where we've trapped people in poverty through the extent of welfare that they have. And I think you've got to do both.

ANDREW MARR:

(over) So you don't think universal benefits should be left?

DAVID CAMERON:

(over) I think, I think …

ANDREW MARR:

You don't stick to that as a principle?

DAVID CAMERON:

I think it's very important that there are universal benefits. You know we pay into this system and that's why I want a really good state pension system. And actually we're the first government in a long time to link the pension back to earnings and give a guarantee of the increase in the pension.

ANDREW MARR:

But you're not against in principle means testing some benefits to make savings?

DAVID CAMERON:

(over) Of course. What you basically need is a system that has universal and fair elements that are part of a decent and civilised society like a good, strong pension provision. And then in terms of the work related benefits, you need a system that means you're always better off in work and working harder and trying to do more for yourself and for your family. Those are the two keys that actually the Liberal Democrats and the Conservatives have agreed in our coalition government, and we are being refreshingly radical in dealing with a problem that has dogged governments for decades and left us with a welfare bill that is frankly out of control and unaffordable.

ANDREW MARR:

How do you bring some … We're sitting here on a rather grim looking morning. How do you bring a little bit of hope and light to all of this, I mean in areas like the health service and so on where people say it's going to be an era of cut, cut, cut; it's always going to get slightly worse? What can you bring to this?

DAVID CAMERON:

Well I think the health service is a good example. You know this is not the Conservative Party of old. This is a modernised, mainstream, middle ground Conservative Party that wants yes to deal with the deficit, but do it in a way that is fair and that takes the country with us. That is why we singled out the NHS and we said in spite of all the difficult decisions, in spite of the cuts that will have to be made, the NHS is different. It is special.

ANDREW MARR:

(over) So do you promise people better care?

DAVID CAMERON:

Yes, I can, because the NHS budget is going to grow in real terms every year during the life of this government. And that means we're able to not just leave it as it is; we are going to improve it. I mean take cancer. Today we're announcing that actually we're going to be spending another £164 million on cancer provision and really updating and improving our screening processes, particularly on bowel cancer, which can save 3,000 lives a year. And I think it's very important as we take the country through what are difficult decisions, to say look there are some things that are so important to families - like my family, like the thousands of families watching this programme - and the NHS is one of those things.

ANDREW MARR:

(over) If we were as good at curing cancer as the average European country, about 5,000 to 10,000 people in this country who die would live a year.

DAVID CAMERON:

That's right.

ANDREW MARR:

Can you say that you intend to close that gap?

DAVID CAMERON:

I absolutely want to close that gap. And I think the announcement today is part of that because we're dealing with one of the problems, which is screening people when they get to about our age. We need more screening. We've got to make sure …

ANDREW MARR:

We won't go into the nasty details, thank you.

DAVID CAMERON:

Alright, we won't go … (laughs) The flexi sigmoidoscopy, I think it's called, but I won't go into the details of where the camera goes.

ANDREW MARR:

Thank you.

DAVID CAMERON:

But if we look at that. And also the other thing is the early warning signs. The truth is we're never going to get to the best in Europe levels of cancer unless we recognise the symptoms earlier and treat people earlier. And so it's not just money. This is about how well GPs do the job, and we need to improve that as well.

ANDREW MARR:

Have you settled the defence row yet?

DAVID CAMERON:

Look all of these are ongoing discussions that we've got to get right in the interests of the country, and in a way nothing is agreed …

ANDREW MARR:

(over) So no?

DAVID CAMERON:

… until everything is agreed.

ANDREW MARR:

So you haven't settled the defence row?

DAVID CAMERON:

So no, I mean very few things have been completely settled because until you've settled everything, you can't actually announce the overall stance in terms of the deficit and what we plan to do. But let me be clear about this. First of all, this is a discussion that is taking place through a National Security Council round a table with the Foreign Secretary, the Home Secretary, the Defence Secretary …

ANDREW MARR:

(over) And your Secretary of State for Defence says it sounds more like a spending review than a defence review.

DAVID CAMERON:

Well what Liam put in that letter - and you know of course cabinet ministers will always want to make …

ANDREW MARR:

(over) An eloquent letter.

DAVID CAMERON:

… very, very strong representations - but he knows and I know that I am passionately pro-defence, passionately pro our armed forces. I will not take any risks with Britain's defence. But I want us to have something that the last government didn't do - a proper review to make sure we're spending money in a way that's going to protect our country for the future. Now that's what this is about and it's happening around the cabinet table in the right way.

ANDREW MARR:

But to be clear about the scale of the decisions, if you put a freeze or cancel those huge carriers and some of the other surface fleet, we would as a country be in the position where the Royal Navy was no longer able to fly the flag or be a presence in the Mediterranean or the Indian Ocean or the Gulf or lots of places, and we might also be in the position where we couldn't operate another Falklands kind of campaign. These are huge decisions for the security of this country.

DAVID CAMERON:

They are huge decisions. But what you've got to do is look at the threats that we face today. If you take the Navy, for instance - as well as having that sort of capacity you talk about, we've got to think about piracy in the Gulf, we've got to think about drug running in the Caribbean. We need in many cases to make our armed forces more flexible, more adaptable, and sometimes that is going to mean changes. You know we inherited …

ANDREW MARR:

(over) Which means we can't fight the old Cold War kind of …

DAVID CAMERON:

Exa… We've inherited a situation which you know we've got lots of …

ANDREW MARR:

(over) It doesn't sound good news for aircraft carriers.

DAVID CAMERON:

… we've got a lot of battle tanks that are ready to roll into Russia. Well that's not what you need today. We've got aeroplanes that are ready to do dog fights with the Soviet Union Air Force. That's not right. We need to be making changes to make sure our defence forces are …

ANDREW MARR:

(over) And what about these two great big carriers?

DAVID CAMERON:

Well that's obviously a very big part of the decisions that we have to make about how we make sure our forces are flexible.

ANDREW MARR:

And as we sit here, their fate is still uncertain?

DAVID CAMERON:

No, one of them is underway and being …

ANDREW MARR:

(over) I know and that will, and that will go ahead? You're going for that one?

DAVID CAMERON:

(over) We will … Look, you're asking me a very good question. We've been set if you like an impossible question. We've got a defence budget that we were left - £38 billion overspent; aircraft carriers where the last government hadn't even worked out what aeroplanes to put on them. We've been left … Of all the things I've inherited as Prime Minister, this is the biggest mess that I've had.

ANDREW MARR:

(over) Okay and that carrier …

DAVID CAMERON:

(over) And what I'm saying to you is that we will answer all of these questions.

ANDREW MARR:

(over) … that carrier which is being built will be built and will happen?

DAVID CAMERON:

What I'm saying to you is that we will answer all of these questions …

ANDREW MARR:

(over) You said that earlier, a few moments ago.

DAVID CAMERON:

Well it's being built at the moment. The point I'm making is that we have to answer these questions - how much are you going to spend, what is the posture going to be - and all of these will be answered in great detail. And what I want to reassure people is this is not being done just thinking about the finances. This is being done thinking about what is right for the country in terms of our defence.

ANDREW MARR:

Will you take a decision on Trident before the end of this parliament?

DAVID CAMERON:

Well the decision has been made, which is that we are committed to our independent nuclear deterrent.

ANDREW MARR:

The so-called Main Gate decision which gives the green light for the new generation of Trident, and it's very important because a lot of people - including the Liberal Party - say that that decision shouldn't be taken during the lifetime of this parliament. Other people say it should. Which is it?

DAVID CAMERON:

Well it's a bit more complicated than that, but not much more. Basically we have an independent nuclear deterrent. I strongly support that and I support its proper and full replacement. That replacement is underway already. It will continue to happen during this parliament. And people should know that we will have what Britain ought to have, which is a proper independent nuclear deterrent as the ultimate insurance policy as part of our defence. That's what's happening.

ANDREW MARR:

And the so-called Main Gate decision will happen this parliament?

DAVID CAMERON:

There are various 'gate' decisions that have to happen.

ANDREW MARR:

Yes.

DAVID CAMERON:

One of them has already been taken, which we took in the last parliament, which was to replace our independent nuclear deterrent. That's what we're doing. And there'll be a stream of decisions as we go through - some before, some after - but I'm absolutely committed to making sure that this happens.

ANDREW MARR:

Isn't it a bit strange, given your political posture, that you have put into place the Harriet Harman equality and fairness legislation in full with all these issues about people making jokes at work, allowing their employers to be sued?

DAVID CAMERON:

That's not quite right. I mean what happened. This was a bill produced in the last parliament by the last government - a lot of which we supported because there's some very important things for instance on trying to make sure we make up the scandalous gap between pay for men and pay for women. So we supported a lot of the bill. In what's known as the 'wash up' before the election, we allowed most of it to go through. Most of it's now been put in place. Some elements we held back on. The specific thing about jokes in the workplace - as I understand it, that was actually already legislated for in the past and this act updates it. But it does put in a test about reasonableness, and I think what we need in our national life is a bit of reasonableness and commonsense.

ANDREW MARR:

Okay. A little message I think for Ed Miliband at this point. You're wearing exactly the same colour of tie as Ed Miliband was wearing last week. I don't know if there's a sense of fellow feeling that he's taken over a job you used to do.

DAVID CAMERON:

(over) There's some subliminal, subliminal message.

ANDREW MARR:

What do you make of him?

DAVID CAMERON:

I don't know him very well. I rang him after he got elected to welcome him to the job you know because I've done it for … I did it for four and a half years. And it is a tough and demanding job. But also to say there will be times when we should act together in the national interest and you know my door's open for him to come and see me and get briefed on issues like Afghanistan or terror or whatever.

ANDREW MARR:

(over) He talks about a new way of doing …

DAVID CAMERON:

(over) I think the big test for him is the deficit. I mean this is the big problem in British politics and they don't seem to have an answer to it at all, and that is frankly not good enough.

ANDREW MARR:

Are you going to be thumping him across the despatch box? I mean everyone talks about a new mood in politics - a bit more collegial and all the rest of it - but it'll be business as usual and it will be pretty bloody stuff. You'll be teasing him about his vote.

DAVID CAMERON:

(over) Well what I've found in … In the House of Commons, what I've found is you can actually work together more constructively and I backed for instance Tony Blair's education bill because I thought it was right for the country. But Prime Minister's Questions is quite confrontational.

ANDREW MARR:

He's been warned, he's been warned.

DAVID CAMERON:

It's the nature of … It's the nature of the place and the way it works. And every now and again, I'm sure there'll be an outbreak of love and harmony, but a lot of the time I expect it'll be pretty …

ANDREW MARR:

Politics as usual.

DAVID CAMERON:

… pretty hard pounding.

ANDREW MARR:

Alright. Okay for now, thank you very much indeed for joining me, David Cameron.

INTERVIEW ENDS