Heath's Conservative Government 1970-74

Question 1

The 1970 Election

Answer 1

• In 1968-69 Wilson’s government was running 20% behind the Conservatives in the opinion polls
• By 1969 however, the ‘two years hard slog’ promised by Jenkins when he became Chancellor in 1967 visibly began to pay off – and the Conservative lead began to narrow sharply
• Heath, elected Conservative leader in 1965 and defeated by Wilson in the 1966 election appeared plodding and unimaginative and failed to catch the public imagination. When the campaign opened in 1970, the polls, the pundits and the politicians all expected a Labour victory.
• The Labour campaign – a complacent ‘presidential’ affair which centred on Wilson – was hit by some adverse balance of payments figures published two days before the election. There appears as a result to have been a last minute swing to the Conservatives.
• In the event, turnout was the lowest since 1935 (72%), almost certainly the result of disillusioned Labour voters staying at home, and, this combined with the last minute swing, enabled Heath to win an unexpected victory with an overall majority of 30.

Question 2

Outline the key individuals of the goverment

Answer 2

• Edward Heath. Prime Minister 1970-74. Very different from the privileged Tory leaders of the 50s, Heath was the product of a lower middle class family who attended an East Kent grammar school before winning an Oxford scholarship – a background not too dissimilar too dissimilar to Wilson who he detested (‘that bloody man Wilson’). A lifelong bachelor, Heath was civilised (a talented musician and yachtsman), capable, efficient and uprights (sacking Enoch Powell from the Shadow Cabinet over his ‘rivers of blood speech’ in 1968), but he was also abrasive, confrontational, uncommunicative and unclubbable. The dominant figure within a relatively weak ministerial team, he became increasingly isolated within his party.
• Iain Macleod. Chancellor 1970. Highly intelligent (‘too clever by half’ Lord Salisbury), acerbic, sharp witted a brilliant debater. Died of a heart attack within weeks of taking office – a devastating blow to a government short of genuine heavy hitters. His replacement as Chancellor, Anthony Barber was a comparative lightweight.
• Sir Alec Douglas-Hume returned to serve as Foreign Secretary.
• Reginald Maudling. Home Secretary, 1970-72. Capable, genial and easy going with some of the communication skills Heath lacked, his career was ended when he was caught up in a financial scandal.
• John Davies was brought in from the business world – he had been managing director of Shell and Director General of the CBI – to run a super-department, the Department of Trade & Industry, but failed to adapt to politics and was a flop.

Question 3

Outline the aims of the Conservative government

Answer 3

• Heath promised a ‘quiet revolution’ in Britain
• The principal aim was modernisation of the economy, to be brought about by:
o Entry in to the EEC which would force British industry to shape up by having to operate in a more competitive environment
o A right wing, free market approach at home, including the abandonment of government backed incomes policies, no support for ‘lame duck’ industries and a tougher line on trade unions
• This latter approach was set out following a meeting of the Tory hierarchy at the Selsdon Park Hotel, Croydon in early 1970
• Wilson responded by ridiculing ‘Selsdon Man’ and ‘stone age economics’, Croydon in early 1970
• Wilson responded by ridiculing ‘Selsdon Man’ and ‘stone age economics’

Question 4

Explain the new ‘HeathCo’ government and its problems

Answer 4

• Heath’s government reflected his no-nonsense efficiency, no Wilsonian Kitchen Cabinet, trusted assistants e.g. Douglas Hurd, at home with William and Richard Armstrong
• Heath prickly, easily offended, an air of openness and honesty which was refreshing yet somewhat unnerving following the duplicitous Harolds, Heath’s government was like the board of a company, and he the CEO, Private Eye – HeathCo ‘a message from the managing director’
• Unfortunate that the Tories were now a one man army, Powell relegated to the back benches, Macleod died five weeks after taking the Chancellor’s office, replaced by the little known Anthony Barber
• Maudling appointed Home Secretary but becoming detached from day-to-day work of a minister and resigned 1972, following accusations of improper financial associations
• Young promising Tories, Thatcher at education, Peter Walker at housing and Jim Prior at agriculture, but none could challenge the managing director who laid down policy
• Heath had clear ideas on what was and was not wanted, he disliked some of Labour’s quangos and the price and incomes board, slimming down of government to promote efficiency, wanted was a new framework for industrial relations
• New Industrial Relations court would see fair play for workers and employers, ending industrial anarchy, central to Heath’s solution was British EEC entry, but the problems he faced outweighed his determination, although an improvement in the nation’s finances under Jenkins; wage increases 10% ahead of productivity, government had support for its Industrial Relations Bill to control the unions from a public fed up of wildcat strikes, but this forced the TUC fresh from victory over Wilson and Castle into opposition with Heath

Question 5

Explain the problems of Northern Ireland

Answer 5

• A Roman Catholic civil rights movement developed in Ulster, only part of Ireland under the crown, parliament was dominated by Protestant loyalists, and the region lived apartheid
• Catholic protests in 1967 and 68 produced Protestant backlash, 1969 Callaghan sent in British troops to protect the Catholics, initially welcomed but by 1970 Catholic attacks on the British army, an ancient enemy
• IRA was revitalised and the provisional IRA established in Belfast and Londonderry to wage guerrilla warfare, violence escalated and seeped into England, Ulster 1970 16 civilians killed, 1971 61 civilians and 43 soldiers died violently

Question 6

Explain why the years 1970-71 were considered a promising start for the government

Answer 6

• Despite the scale of the problems, for 12 months things went according to plan Heath won a parliament majority of over a 100 for British EEC entry, August he skippered his yacht to victory in the Admiral’s cup, used television to cultivate the image of a strong leader
• The great achievement was getting French the parliamentary approval for the EEC, played a large part in winning over the PM Pompidou, Enoch Powell resolutely opposed though with a small band of Conservatives, Labour opposed but carried through by a group of Labour rebels led by Roy Jenkins, Heath ‘success in October made sweeter as it divided Labour
• 1971 a popular tax cutting budget from Barber to stimulate the economy, standard income tax cut 2.5%, ending of free school milk less popular, Thatcher’s education on the whole no so controversial, launched the open university, withdrew Crosland’s circular encouraging local authorities to push ahead with comprehensives, but approved the majority of schemes put to her by authorities, pace of comprehensivisation continued
• One of Heath’s talented Lieutenants Peter Walker pushed through a radical overhaul of local government, Local Government Act of 1972 swept away historic boundaries in favour of efficiency, Rutland disappeared, new authorities like Cleveland and Humberside created, horrified Conservatives

Question 7

Briefly outline the Labour relations of the era

Answer 7

• Other great plank of the Heath programme was new framework for industrial relations in 1971, a complex bill laboriously put through parliament by Employments Secretary Robert Carr, and Solicitor General Geoffrey Howe
• IRA 1971 created the National Industrial Relations Court, could: halt strike action for 60 days for negotiation, order ballots to ensure strikes were representative of all union members
• Unions opposed the act and refuted Heath’s attempt to create a voluntary income policy 1972
• IRA proved unenforceable, strike by NUM 1972, rejected NCBs pay offer and 280,000 miners striked, and 1974 rejected NCB again, strike when oil prices high, Heath declared emergency, Heath refused miners demand and called a GE

Question 8

How and why was the government blown off course

Answer 8

• A Conservative government intent on reducing the role of government was forced to nationalise Rolls Royce facing bankruptcy
• In Scotland the threatened termination of Upper Clyde Shipbuilders with the loss of 4000 jobs was politically unacceptable
• New Spirit of violence in the country, Angry Brigade bombed Robert Carr Employment Secretary’s home, telephone threats
• Northern Ireland Willie Whitelaw faced sectarian hatred, violence grew with four bomb explosions and 30 shootings a day on average, 1971 Whitelaw agreed to the request of NI government for interment of IRA suspects, a disaster, no senior IRA figure was caught and a third arrested were released within two days, infuriated Catholics and garnered IRA support
• January 1972, a banned civil rights movement went ahead and 14 unarmed Catholics were killed by the British army, ‘bloody Sunday’, money for weapons poured in from North America’s Irish communities, 1973 – 223 civilians and 103 soldiers died
• March, Heath suspended the Stormont Parliament and rule directly from London, end of a 50 year experiment, secret talks held with the IRA but got nowhere, extended bombing to Britain

Question 9

Examine the role and effect of miners on Britain

Answer 9

• At home, escalating pay claims and confrontation with the National Union of Miners (MUN), Industrial Relations Act was not working, new industrial relations court with powers to enforce ballots before a strike and a cooling off period, could only act if unions registered under the Act
• Most refused to register as the TUC advised, most employers, not wanting trouble with their workforce also ignored the court, when it did act, controversially as in the London Docks in 1972 ordering the arrest of five shop stewards in an unofficial dispute, a national dock strike was threatened
• Attempted to use the Act in a railway strike in May 1972, membership of the NUR simply voted 6 to 1 to continue the strike, a clear failure, brought government into contempt
• Government confronted with a wage explosion, pay increases outran inflation, fuelling further inflation, miners in a declining industry had accepted moderate pay settlements over the past 15 years for job security and a policy of voluntary redundancies as uneconomic pits were closed, now demanded a catch up
• Gained 14% in 1971 when inflation was 7%, government, the paymaster of nationalised industries felt demands should be moderated, the miners increasingly under the influence of more extreme leadership
• Scottish communist Mick McGahey became VP of the NUM, in Yorkshire militants were becoming more influential, Coal Board offered 8% for 1972, rejected by the union and a national strike began in January
• Strike brought young Arthur Scargill of militant left wing views to prominence, already known from two unofficial disputes in 1969 and 1970, 1969 strike saw the first use of flying pickets
• Using cars and buses, miners could descend unexpectedly on the chosen target to swamp police cover, tactic was widely adopted by the NUM in the 1972 dispute, a coke depot belonging to the Wet Midland Gas Board at Saltley became the focus of a battle between miners and the government
• Thousands of miners arrived under the direction of ‘general Scargill’, depot successfully closed, coal stocks running down and power cuts occurred, government surrendered, NUM got everything, miners got a settlement of twice inflation
• Miner’s victory encouraged other workers to press for larger incomes, for Heath, other than allowing galloping unemployment to discipline the workforce, was to return to a government prices and incomes policy
• Throughout Autumn 1972, talks were held with the TUC and CBI to see if a voluntary wage agreement was possible, unions incensed by the Industrial Relations Act, and the TUC incapable of disciplining its members, broke off the talks in November
• Heath introduced a three phase prices and incomes policy, 1 – six month pay freeze, 2- counter inflation act establihsed a prices commission and pay board, wage roses capped £250 a year, 3 - wage roses capped £350 a year
• Policy favoured the less well off with flat rate increases but this did not save it from union denunciation as oppression of the working class
• The adoption of an incomes policy, in contrast with its dropping in 1970, was the real essence of the U turn, in reality Heath was always an interventionist and ‘Selsdon Man’ a product of Labour propaganda and Thatcherite mythology
• Only Powell among Tories denounced the return to incomes policy, Thatcher, Keith Joseph and Geoffrey Howe, to be associated with the return to market forces all backed Heath
• 1973 the policy appeared it might work but Arab-Israeli conflict in October led to a reduction in oil supplies, price of oil rocketed undermining the cheap energy base of western prosperity, price multiplied by 5 1972-74, British coal became more important
• Heath rightfully fearful of more confrontation with the miners, Gormley, the moderate president of the NUM was only too happy to avoid direct confrontation
• Heath sought an unofficial deal with NUM, Gormley tipped the wink that payment for unsociable hours would be enough appreciative of Heath’s goodwill, but Heath guilelessly wrote this into phase 3 instead of saving it as a treat for miners, NCB rejected by the NUM beginning an overtime ban, miners challenging the government itself
• To some in the NUM such as Scargill the strike was political, TU power bringing down the capitalist system, government better prepared this time introducing a three day week to save power and demand for coal, cut 40% productive activity, but only 5% output raising serious questions of British industrial productivity, 50mph spped limit, television ended 10.30pm
• February Heath decided to strengthen his hand by fighting a winning a GE on ‘Who Governs Britain?’, PM still anxious not to polarise the country and fight a union bashing campaign, Labour and Conservatives still less than exciting, liberals appeared interesting
• Powell damaged the Tories, leaving the party and standing as a unionist in Northern Ireland, he urged voters to vote Labour to get out of Europe, a quiet election at the end of February produced a hung parliament, Liberal – 19% vote but only 14MPs, Tories – 38% 297 seats but Labour 301 seats with a similar vote share
• Heath sought a deal with Jeremy Thorpe Liberal leader but in the end failed, Harold Wilson was called to the palace to become PM again, another triumph for union power, Heath a divisive figure for Tories

Question 10

Explain Wilson’s role as ‘centre half’

Answer 10

• Wilson returned less the irrepressible smart arse of 1964, more a wearied statesman, announced he would play a less prominent position, colleagues found him less interfering and less concerned with Cabinet plots
• Despite his age and recovery from ill health, Wilson still dominated PMQT and ran rings around Heath and young Thatcher Heath’s 1975 successor, still displayed wit April 1974 memo sent to the Central Policy review staff
• But Wilson had no answers to the mounting economic crisis, no appetite for Union confrontation
• Wilson’s priority was to be the saving of party unity, threatened by the issue of Europe, since Labour’s 1968 bid the Tories had swung anti-Europe, many saw the European Community as a rich man’s club devoted to capitalism
• Substantial minority of Labour MPs led by Jenkins believed membership would be healthy for Britain, Wilson was never a European enthusiast but increasingly believed withdrawal could be damaging, his Foreign Secretary Jim Callaghan appeared to share this view
• Both went about maintain Britain’s community membership and party continuity, he adopted Benn’s idea of a referendum as an alternative to a party policy of outright withdrawal, drew out the procedure as opposed to giving the two sides his party the irrevocable chance to stand against one another, able to gain minor concessions from Europe to persuade a Cabinet majority to back staying, however it was agreed Cabinet members could campaign on either side
• Benn and Foot campaigned no, Powell, Jenkins and Hath campaigned yes, Wilson supported yes, result in 1975 was a clear yes for staying in, triumph for Wilson, talented government:
o Callaghan wen to the Foreign Office and mended fences with the USA, more in favour of good US relations than Heath
o Energetic Denis Healey went to the treasury, most important and challenging job, served as Chancellor for five gruelling years
• Wilson, Callaghan and Healey very much the managing inner team, Jenkins returned to the Home Office but he was no longer seen as a likely leader, diarist Richard Crossman died 1974 but the two other notable diarists Barbara Castle and Tony Benn continued in the Cabinet
• Benn increasingly the standard bearer of the far left, opposed to Europe, at the department of industry pushed for greater state ownership to the embarrassment of Wilson
• A leading members of Labour’s National Executive, hero of left wing party activism, had pushed for a commitment to nationalist the top 25 firms in the country, NEC agreed but Wilson did not, Benn had an unhappy relationship with the PM who clipped his wings in a 1975 reshuffle to the Department of Energy
• Other leading left figure in the Cabinet as Michael Foot, opposed to the EEC but a crucial member of government, Department of Employment and key TU linkman
• As well as seasoned talent, up and coming figures such as David Owen and Shirley Williams

Question 11

Explain the state of Britain 1974-1975

Answer 11

• Two years of Wilsons’s government among the most crisis ridden in modern British history, violence in Ulster spilled into mainland Britain, Welsh and Scottish separatist parties began to perform well threatening the UK’s existence
• No answer to the trade unions, escalating inflation 27% in 1975, shares fell and foreigners withdrew their money, FTSE index fell from 544 in 1972 to 146 in 1974, living standards were falling for the first time in 40 years, inflation ate away at savings and house prices fell 13% 1974 and 16% 1975, even the population fell
• American Commentator on CBS – Britain becoming ungovernable, highest rate of income tax at 83% and unearned income at 98%
• Growing extremism in political life, symbolised by the prominence in the NUM of committed activists such as Scargill, new group of left wing activists coming to the fore in universities and in some urban areas, looked to the memory of Trotsky for inspiration rather than Stalin, some sought to takeover local Labour parties, shouting down traditional moderates, many areas the process was easy with badly attended meetings dominated and key local positions occupied, resolutions passed for extensive nationalisation and confiscatory taxation
• Frightening loss of grip on reality, consensus politics challenged as never before since 1945

Question 12

Assess how and why the government was just about surviving

Answer 12

• Most urgent matter to settle was the miners’ dispute, new government strategy was give in, miners received enormous pay increases with the industry age bill increasing 32%, ratchet up pay demands of other workers and inflation
• Other requirement was to enlarge the government’s hold on power with another election, Wilson stuck it out until October 1974 and fought a quiet campaign on how Labour was more likely to preserve social harmony, talk of a ‘social contract with the unions, when it came to concessions in welfare and legislation on work practices, the unions would behave responsibly when it came to wage demands
• Labour’s vote increased and their seats rose 301 to 319, a majority of 3, 13 Liberals, 11 Scottish nationalists, 3 Welsh nationalists and 1 SDLP member from NI, many of these smaller party MPs likely to vote Labour also
• Michael Foot at employment responsible with building bridge to the unions, friendly relationship with Jack Jones TGWU leader, new to government and divided opinion on his departmental handling
• Foot pushed through a series of measures to placate the unions, key element in the social contract, civil servant – ‘finding out what the unions wanted and giving it to them’, Heath’s legislation repealed, a Health and Safety at Work Bill was passed, Trade Union and Relations Act got rid of the industrial relations court and restored union immunity from civil claims for damages
• Foot was prevented from extending the rights of pickets by pressure from Cabinet colleagues notably Jenkins, appalled that the Pickets should be given the same as the police to stop road vehicles
• Foot instrumental in establishing the Advisory and Conciliation service to bring the two sides of industry together and settle disputes, a pet project of Jack Jones, an Employment Protection Bill extending workers’ rights and led to fresh Cabinet disputes about the closed shop
• Foot and the unions did not get all they wanted due to opposition from Jenkins again; a new Sex Discrimination Act as passed through, TUs had received considerable concessions
• Growing economic crisis, rising inflation and a falling pound forced the Treasury to press for a statutory incomes policy, Foot would resign if one were adopted, in return Jones delivered a voluntary £6 a week for concessions, his proposal was accepted by his Union, then the TUC General Council then the whole TUC conference, Foot remained
• Measures weren’t as successful as hoped, RPI fell only 10%
• Benn at Trade and Industry tried to push through a hard left agenda of state control, wanted to use the National Enterprise Board (NEB) forcing companies into planning agreements and taking growing state share of the ownership
• Circumstances forced him to rescue lame ducks such as the Norton Villiers Triumph motorbike factory and Kirby Engineering, involved the promotion of workers’ cooperatives
• Not a notable success – ‘Benn follies’, much of the department’s budget had to go to rescuing British Leyland, Cabinet hostile to Benn’s approach

Question 13

Explain the initiatives and measures implemented by the Tories

Answer 13

• Painstaking negotiations led to Britain’s entry into the EEC in 1973, the Heath government’s sole major achievement. Britain’s entry was opposed by Labour, though 67 rebel Labour MPs vote with the government.
• The machinery for intervention in the economy established under Wilson, notably the Industrial Reorganisation Corporation and the Prices ad Incomes Board was scrapped.
• The Industrial Relations Act 1971, highly controversial, reformed trade union law in an attempt to cut down strikes and curb extremists. A National Industrial Relations Court was established with powers to order pre-strike ballots of union members and a ‘cooling off period’ before strikes began; individuals were to have the right to join or not to join a trade union, which outlawed the practice of the ‘closed shop’; and unions were only to be immune from damages claims by employers after calling a strike if they registered under the act.
• There were some successful, if relatively minor instances of modernisation including the introduction of decimal currency 1971, the Local Government Act 1972, which involved a redrawing of local government boundaries, and innovations in the machinery of government notably the creation of a government ‘think tank’, the Central Policy Review Staff.

Question 14

Examine the failure of the Heath government

Answer 14

• Heath was forced to U turn on his non-interventionist approach to industry, when one of Britain’s most successful high tech companies, Rolls Royce, was faced with bankruptcy. The Heath government nationalised it 1971. A similar rescue act was performed on behalf of Upper Clyde Shipbuilders 1971. The Industry Act 1972, set up an Industrial Development Executive which looked remarkably like Labour’s Industrial reorganisation Corporation.
• The unions made the Industrial Relations Act unworkable by refusing to register under it and accepting the legal consequences of doing so (fines by the Industrial Relations Court for failing to order members not to engage in strike action – and in one case imprisonment for contempt of shop stewards who were picketing an employer using non-union labour and who refused to appear before the Court: the result was a national dock strike.
• Early 1972 saw a national miners’ strike for the first time since 1926. The National Union of Mineworkers, led by an affable right winger, Joe Gormley, believed that miner’s pay had fallen far behind that of comparable industrial workers and demanded catch-up pay increase. The government, paymaster of the public sector coal industry, though the demand was inflationary and set out to resist it. Severe winter weather and the effectiveness of the NUMs ‘flying pickets’ in preventing the movement of coal stocks forced the government into ordering a three-day working week and widespread domestic power cuts. In the end the government capitulated and the NUM won a pay increase in excess of 20%. The Heath government was left looking weak and ineffective.
• BY the time of the miners’ strike the economy was encountering severe difficulties in the shape of ‘stagflation’ – a combination of no growth and high inflation. This was partly caused by turbulence in the world economy – high commodity prices and a US devaluation, which led to abandonment of a fixed exchange rate for the £ in 1972 – and wage inflation at home resulting from aggressive trade union action. Faced with the need to control inflation, the Heath government performed another major and humiliating U turn when it imposed a compulsory pay freeze in 1972 and followed it with two years of statutory incomes policy in 1972-74. A Prices Commission and a Pay Board were set up – looking remarkably like Labour’s Prices and Income Board, which Heath had abolished in 1972.
• Worse was to follow. In 1973 the OPEC ‘oil shock’ led to the tripling of oil prices, fuelling UK inflation further – it reached 19% in 1974. In these circumstances unions sought wage increases above those envisage by the government’s pay policy. The NUM was leader of the pack. In December 1973 it introduced an overtime ban. The government responded by introducing a three day week. In February 1974 the NUM launched an all-out strike. Heath’s reply was to call an election on the issue of ‘who governs?’ – The trade unions or democratically elected politicians. The outcome of the February 1974 election was a hung parliament – Conservatives 297, Labour 301, Liberals 14, other 23. Wilson returned to office as head of a Labour minority government.
• Heath presided over a period in which the economy was deteriorating sharply – in significant part for reasons beyond his control. Even so, his government’s record was dismal: it was comprehensively out-manoeuvred by the unions; it was forced into a series of humiliating reversals of policy; and its defeat at the polls in 1974 demonstrated an inability to mobilise public opinion effectively.