BRITAIN 1945-2007

The Years of Consensus: 1964-79

Key dates: 1964: Labours election victory under Wilson, National Plan, IMF loaned UK 1 billion 1965: Race Relations Act 1966: elections gave labour increased majority, prices and incomes freeze introduced, 3 month seamans strike 1967: Dockers strike, second EEC application denied, pound devalued, abortion act, sexual offences act 1968: immigration act, race relations act 1969: open university, death penalty abolished, In place of strife 1970: Heath becomes pm 1971: industrial relations act 1972: local government act, miners strikes, government freeze pay introduced 1973: UK joined EEC, 3 day working week, start of oil crisis 1974: another miner strike, Wilson becomes pm 1975: referendum on EEC membership 1976: Callaghan becomes pm, IMF crisis 1977: Lib-Lab pact 1978-9: winter of discontent 1979: labour lost election

Harold Wilsons Governments 1964-70

The 1964 election
Wilson showed a more youthful image, more in tune with young people and their idea of a progressive Britain Wilson played on the contrast between him and Douglas-Home: plain straight-speaking Yorkshire man vs aristocratic toff Spoke of Britains need to respond to the white heat of the technological revolution However, was a close finish. Labour victory was very narrow. Labour had slightly increased their share of the vote whilst conservatives slightly fell, giving labour an overall majority. After 13 years of conservatives in power, electors wanted change.

Macmillans claim that Britain never had it so good was dented due to employment reaching over 800,000 in 1963

Conservatives humiliating failure to join the EEC shown Britain to be weak internationally

Scandals tainting the conservative party 1963-4 weakened its claim to integrity and competence

Labours victory

Conservatives didnt have a modern image that appealed to everyone whereas labour was in tune with the changing times and Wilson was better with public image And competence

Labours difficulties in government

There were already economic difficulties as Britain was undergoing a major shift in its economic and social structure. It was changing from an industrial economy to a postindustrial one: manufacturing industries were shrinking and service and finance industries were expanding Britain had then failed to match growth rates achieved by industrial economies of Western Europe, japan and USA. As it spent too much on defence and too little investment in industry. THE NATIONAL PLAN: o Wilsons government began with the creation of a new Department of Economic Affairs under George Brown who drew up the National Plan and created a new Ministry of Technology o Was a programme aimed at stimulating industrial production and exports by encouraging co-operation between government, employers and trade unions o But few of these targets were met and by 1967 the national plan had been abandoned o In the interim, the electorate were impressed by the governments modernising programme and gave labour a majority of 110 seats in the 1966 election

Tensions with the unions

Wilson believed that inflation and Britains payments deficit were the major threat to Britains economic progress and therefore wage and salary increases must be kept in check. He warned the labour party, trade unions and employers that they had to become more realistic in their approach to wage demands and settlements From 1966 election success, Wilson pressed forward with his ideas with cuts in government spending and a wage freeze A prices and incomes board was set up with the power to regulate pay settlements. Wilson disappointed the left of the party and angered trade unions, which had hoped labour would bring them benefits instead of lectures on their need to be responsible

There were series of strikes over pay in 1966-67; the worst was lengthy stoppages by seas and Dockers unions.

Devaluation 1967
He believed industrial troubles were a key factor in the increase in Britains trade deficit The deficit had grown so considerably that in 1967, he felt that he had to approach the IMF for another large loan He blamed the trade unions, claiming that the government had begun to surmount the financial problems but was disrupted by the 7 weeks seamens strike The IMF loan was a stopgap (temporary way to deal with problems), which was a worrying sign that the government was losing control over its own finances In late 1967, he devaluated the pound but assured viewers that the pound in their pockets wasnt worth any less By delaying the measure and turning it into a drama, he made devaluation appear as a greater political and economic failure by the government Wilson was convinced at the time that Britains sluggish industrial performance was caused in large part by poor industrial relations

Second attempt: EEC

He feared Britain would be finally and economically left behind unless it joined Fully backed by conservatives and liberals but opposed by 36 labour MPs, the government made its formal request The belief that Britain would be an obstructive member of the EEC meant that the French president vetoed the uks application

In Place of Strife 1969

Failure over Europe strengthened Wilsons determination to bring the unions into line, in 1969 he published a white paper, that set proposals aimed at preventing future strikes The white paper proposed a series of legal restrictions on the right of workers to strike. Members of a union would be balloted and would have to agree by a clear majority on industrial action before that a strike that would be legal. Proposals also obliged employers to keep to agreement and consult unions when major decisions were contemplated. But unions werent fooled, they saw the restrictions as attempts to make the strike controls more acceptable to the employees However, it created deep and immediate divisions. The left thought that it undermined the principles for which the labour party was supposed to stand- protection of the unions. The party had come into being to resist restrictive laws on the workers and it was suggested that the laws should not be relaxed but tightened.

The record of the Wilson government 1964-70

At the end of Wilsons first government, people thought it hadnt lived up to expectations Traditional labour supporters were the most disappointed as the government had promised a lot but delivered little There had not substantial change, it could not be said that the streamlining of British industry overall had been achieved However, SOCIAL REFORMS o Race Relations Act 1965 and 1968: these acts prohibited racial discrimination in public places and in areas such as employment and housing Made incitement to racial hatred an offence Set up a Race Relations Board to investigate complaints of racial discrimination and Community Relations Commission to promote racial understanding Enoch Powell, a conservative politician o The Abortion Act 1967: permitted legal termination of pregnancy where two doctors certified there was a serious risk to the physical or mental health of the mothers or a strong possibility that child would have serious abnormalities Some moralists saw the states sanctioning of the murder of the innocent. By 2005, the number of abortions had passed 5 million which antiabortionists condemned as a holocaust of death Feminists hailed it as a major step in the liberation of women, since they got the right to choose o The Sexual Offences Act 1967: permitted male homosexual acts in private between consenting adults o The Office of Ombudsman created 1967: ordinary citizens could appeal to a special parliamentary officer if they felt they had suffered abuse of authority by a government department o Commonwealth Immigration Act 1968: prohibited new immigrations from settling in Britain unless family connections were already established The act built upon a previous measure by conservatives in 1962, both parties had concluded that limitations on entry into Britain was necessary in interests of good race relations o Theatres Act 1968: ended theatre censorship by removing the system that plays had to be submitted to Lord Chamberlain before they could be performed o Abolition of the death penalty 1969: removed the five remaining categories of the offence for which the death sentence had been imposed o Divorce Reform Act 1969: allowed couples on the grounds of irretrievable breakdown of their relationship o The Open University 1969: enabled previously unqualified students to read for degrees by studying courses broadcast on radio and TV

Failed attempt to join Europe Rising unemployment Growing inflation

Support of involvement in Vietnam War

Criticisms of Wilsons first government

Attempted restriction of trade union freedom Wage controls

Immigration controls

The Vietnam War To try and restrict the spread of communism in Asia, the USA joined the struggle in IndoChina. Britain didnt become directly involved but labour and conservative patty consistently gave their diplomatic backing to the USA

The end of Britains east of Suez role 1967-71 The government decided to end Britains east of Suez stance In 1967, the defence minister announced plans for the withdrawal of British troops from their bases in Borneo, Malaya, Singapore and the Persian Gulf The usa disapproved and argued that the cold war tensions required a greater not lesser commitment to the defence of the worlds strategic area However o Couldnt afford to maintain expensive bases, with financial and economic difficulties at home o Military resources had been stretched due to exhausting military engagements o Gave up its former colonies and the abandonment if the vestiges of the empire made it logical for Britain to withdraw from its military bases

The 1970 election Despite internal party unrest and the loss of a number of seats in byelections, Wilson believed their support remained solid He had not realised that his undistinguished economic policies and failure to control the unions had lost his government a significant degree of support There was also the case of devaluation

The Edward Heath Government 1970-4

He entered office with the aim of following expansive policies, he declared he was adopting a new style of government and that he intended to reduce the rise in prices, increase productivity and reduce unemployment. Industrial relations act 1971 Was an extension of in place of strife, which Wilsons government had considered in 1969 but had withdrawn in the face of party and trade union opposition It restricted the right of a National Industrial Unions were required to workers to strike by Relations Court was set up put themselves on a introducing new concept with authority to judge government register if of unfair industrial the validity of strike action they wanted to retain practice their legal rights A further example of the new right approach was the policy followed by Barber as Chancellor of the Exchequer. His early measures included income tax cuts, reduction in government spending and scrapping of the Prices and Incomes board. He gained support from workers for lifting the restrictions on wage bargaining but then lost it by his tax concession to the wealthy and the cuts in government spending, which included a rise in council house rents due to the reduction in the subsidies paid to local authorities. The government was also made unpopular due to the withdrawal of free milk. The government was condemned for abandoning the mixed economy, weakening the welfare state, undermining the principle of full employment and not bringing about social improvement

Heaths U-Turn o Inflation had risen to 15% by the end of 1971 and declining industrial output destroyed the governments confidence that they could continue their original policy o It had abandoned the notion of government non-interference in industrial matters. The department of trade and industry began to help out lame ducks. subsidies were granted to other private companies in difficulties. Problems with the unions Heath wanted to solve common problems. But the unions were suspicious and hostile. As soon as the Industrial Relations Act had been passed, the TUC had resisted by formally voting against it. None of the unions registered, making it impossible to enforce the act, showing Heath and his cabinet as incompetent. The national union of miners called a strike during it which it effectively used flying

Pickets, groups of members ready to rush to area of strikes to add more weight, to bring the movement of coal to a standstill, disputing fuel and electricity supplies and reducing industrial production. The three day week: 1973 o Heath hoped to defeat the miners by imposing severe limits on the use of fuel, enabling the government to resist NUMs attempted blackmail o Heath believed that government would be able to survive the strike to a greater extent and said that most industrial and commercial premises will be limited in the use of electricity to three specified days a week. o When the dispute was finally settled, miners gained 21% wage increase and then went on strike again for further wage demand in 1974. Heath called a vote on who ran the country: government or the miners. The answer was not what he had expected. Local government reforms 1972-3 It attempted to reshape the structure of local government and the measures destroyed many historical administrative landmarks. Whole areas were subsumed with newly created regions and many place names disappeared. Right-wing conservatives protested because the reforms attacked on local identity. Britains Entry into Europe 1973 Following De Gaulles retirement in 1969, the EEC invited Britain to reapply In 1972, it signed the treaty of accession and became a member Edward heath probably regarded this as his greatest achievement He tried to give the impression that Britain was negotiating from strength and would strike a hard bargain but heath actually told his team to accept any terms. In 1972, economic difficulties made Britain weak. The Six knew that Britain had requested membership because it could not survive on its own. Heath had hoped that by joining Europe the government get back some economic ground but the entry coincided with an international crisis, as Britain and Europe were dangerously susceptible to events in the outside world

Advantages Gained access to European markets As part of a European block, it stood a better chance of attracting foreign business

British regions were entitled to European development grants

British workers had the right to work in other EEC countries

Disadvantages Britain could no longer buy food from the commonwealth At the time of entry, Britain was believed to be an advanced industrial economy; it therefore had to make higher contributions to the EEC budget than it received in grants. Became victims of CAPs food policy, and brutish consumers paid inflated prices: in 1980 was an average of 1000 per family per annum The Common Fisheries Policy restricted Britains right to fish in customary grounds and led to the virtual destruction of Britains fishing industry Britain had to impose VAT on most commodities which British consumers bought.

The International oil price rise 1973 Until early 70s large multinational companies had controlled production and distribution of oil and supplied the western world with relatively cheap fuel From early 60s, OPEC (represented all leading oil-producing nations, including Arab states) members established greater control over their own oil industries. They gained strength as in 1973, its Arab members used oil as a weapon in their longrunning conflict with Israel The west supported Israel and the Arabs therefore reduced their oil supplies and at the same time, OPEC raised their oil prices from $2 to $35 a barrel The results were rapid and severe inflation occurred throughout the world- Britain suffered a recession.

Economic effects

Balance of payments deficits rose to 1 billion Annual inflation rate rose to 16% Value of sterling dropped to $1.57 Interest raised to 15% Between 1974-76, the unemployment figures more than doubled to 1.44 million

The February 1974 election There was a sense of hopelessness and disappointment and the labour party had a narrow victory. The conservatives gained a higher aggregate vote but the labour party gained more seats.
The wage demands on the unions and large numbers of days lost in strikes resulted in decline instead of growth in productivity

Rapid inflation had made the holding down of prices impossible

Was Heath a failure?

The 3-day week showed how far the government had fallen short of its aims

Unemployment had not been reduced.

Local government reforms

Local government act 1972&73 In reshaped the structure of local government, measure destroyed historical landmarks Whole areas were subsumed into newly created regions. Right-wing conservatives complained that it attacked local identity

International oil price rise 1973

OPEC members began to establish greater control over their own oil industries in the 1960s and in 1973, its Arab members chose to use oil as a weapon As the west supported Israel in the Arab-Israeli war of Oct 1973, they reduced their oil supplies and at the same time, OPEC raised the price of oil exports. Oil increased to $35 a barrel from $2 Oil-based products became more expensive and states dependent on oil suffered This resulted in severe inflation and Britain suffered recession

Britains entry into Europe 1973

De Gaulle had retired and the EEC invited Britain to reapply Having been invited to apply, Heath rushed to comply with their conditions of entry. It is now known that Heath told officials to accept any terms, despite at the time giving the impression that Britain was negotiating from strength and would strike a hard bargain

Disadvantages Couldnt buy cheap food from commonwealth Britain was classified as advanced industrial economy so it had to make higher contributions than it received in grants. The Common Fisheries Policy restricted Britains right to fish in its customary grounds and destroyed UKs fishing industry Had to impose VAT, began at 8% but doubled to 17.5%

Advantages Gained access to European markets British regions were entitled to European development grants British workers had to right to work in other EEC countries

Labour in Office 1974-9

Labours narrow Commons majority
Their overall majority throughout its 5 years in office was never more than 3 seats Tight margin meant that they were heavily dependent on liberal MPs, which gave the liberal party much influence

Inflation
Due to oil price rise of 1973. There was a decline in the value for money and growing debit in the trade balance, which threatened to make Britain bankrupt The IMF crisis Chancellor of Exchequer began negotiating a loan of 3 billion from the IMF, terms included that Britain had to make major cuts in its public expenditure- the unions threatened to make trouble Healey (CofE) was jeered by delegates and the fued between the left and centre-right of the labour party was worse than ever It had happened by 1979 and helped to stabilise the financial situation, but unemployment reached 1.6 million in 1978

o o o

Unions
The cuts in public expenditure and rise in unemployment annoyed the trade unions The previous credit the government had earned from the Industrial Relations Act 1974 was lost as the workers did not co-operate consistently with it

1975 referendum
General vote by the electorate on a single political question which has been referred to them for a direct decision In order to improve relations with the unions, Wilson wanted to renegotiate Britains membership with the EEC People were upset and argued that the referendum should have preceded Britains entry. Also, the yes campgain was funded by the EEC and therefore was able to spend more on promoting it.

Wilsons retirement
Many believe he left early as he didnt want to deal with the economic problems. There were also rumours that he was threatened with blackmail by the soviet secret service over an affair he was having with his secretary.

Callaghan
o Strikes almost every month of when he was in office

o o

The unions became more aggressive, as Callaghan angered them by announcing a 5% ceiling on wage rises Foreign journalists coined the term british disease to describe the bad employer-worker relations and constant industrial stoppages

A year long strike in 1977 at the Grunwick photographic works in N.London involved mas picketing and violent clashes with the police

Firemans strike in 1977, Prime Minister announced a state of emergency

Industrial actions
A lorry drivers strike in 1979 threatened the nations food supplies. Drivers gained 20% wage rise

The workers at all 23 plants of Ford motors went on strike in 1970. Dispute was only settled by ford management giving a 17% pay rise

The winter of discontent 1978-9

There was increasd militancy among public sector workers as they didnt want to miss out on the large pay settlements being achieved by unions in the private sector, they also felt more vicimtised by the governments cuts in oublic expenditure.an alliance of public serbice unions, including the influential NUPE and COHSE, led to a 1.5 million workers strike on the 22 january Mounds of rubbish were left to pile up and industrial actiom by grave diggers left dead bodies unburied Media: depicted a collapsing, rotting Britain. Callaghans failures: Failure to call an election in autumn 1978, when opinion polls showed his governmne twas picking up support Relaxed style of leadership was not suited to a situation where a more dynamic approach was necessary When asked by reporters how he intended to deal with the chaos, he denied there was a crisis. Many believed this captured his reluctance to engae fully with the issues confronting his government

The 1979 election

Economic financial crises Rising unemployment Belligerent trade unionism Political misjudgements: treatment of minority parties. 1978: allowed LibLab Pact to lapse, which left Callaghans gov dependent on the Scottish Nationalist Party but this was lost, as the gov refused its proposal for devolution. Errors provided opportunity for conservatives, gained 70 seats over labour.

Problems