The End of Post-War Consensus (1970-1979) Flashcards
What was Selsdon Man?
The Shadow Cabinet met at Selsdon Park in early 1970 to decide what changes were necessary to win the next election
The following policies were adopted:
- Economic policy would concentrate on reducing state intervention and deregulation
- Focus on achieving entry to the EEC
- Greater competition in industry
- Reduced personal and corporate
What were the promises of the Heath government in 1970?
- A break with interventionist policies
- Market solutions would be sought
- Legal reform of trade unions to bring them under control
- Taxpayer money would no longer be spent on helping ‘lame duck’ industries
- The rejection of compulsory wage control
What were the initial economic policies in 1970?
- March 1971 budget (Replaced purchase tax with VAT and relaxed exchange controls)
- ‘Competition and Credit Control’ (Liberalisation of the banking system with high level lending and increase in sterling money supply)
- Reduction of direct taxes
- Decimalisation in 1971
What problems did the economy face in 1971?
- Increasingly powerful trade unions
- Inflation rose - 5% in 1969 to 10% in 1971
- Country’s growth rate decreasing - 2.5% in 1969 to 1.7% in 1971
- Imports increasing - Surplus of £1 billion in 1971 -> deficit of £1 billion + in 1973
- Unemployment rising - 1972 = 1 million unemployed
Describe nationalisation U-turns 1970-1974
Rolls Royce nationalised in 1971
Upper Clyde Shipbuilders nationalised in 1971
Which economic policies 1970-74 impacted on inflation?
Worsened:
- Abolished the Prices and Incomes Board (set up under Wilson to combat inflation)
- Reduction in standard rate income tax
Improved:
- Severe public expenditure cuts (including cuts in subsidies to council house rents and school milk)
What was the 1972 Barber Boom?
March 1972 budget cut taxes and increased public expenditure. This pushed up the growth rate to 7.4% by 1973. However, this was against Heath’s earlier promises and eventually voluntary wage control proved impossible to maintain, forcing yet another economic U-turn.
Describe the 1972 economic policy U-turn
- Creation of a Prices Commission and a Pay Board in an attempt to control inflation
- 90-day freeze of pay, prices and rents starting 6th November 1972
- Price and Pay Code to strictly limit increases in pay, rent and prices
This was against everything agreed at Selsdon park.
Describe the 1973 Oil Price Crisis
Started due to the Yom Kippur War when the OPEC declared an oil embargo targeted at nations perceived to be supporting Israel (this included the US and the UK)
Price of oil went up by 4 times its usual price
Price of oil rises:
1973 - $3
1974 - $12
1980 - $35
What was the Industrial Relations Bill 1971?
Curbed unions power using the following measures:
- Agreements between employers and workers were to be legally enforceable
- Closed shop was to be banned
- Industrial Court was set up to try cases
Became law in August 1971.
What were the problems of the Industrial Relations Bill 1971?
- There was a loophole which the TUC exploited liberally
- According to opinion polls, the public opinion of trade unions was at its highest for three years and the public did not take the new law well
This resulted in a law with huge political, economic and industrial costs but with no pay off.
Who were the Pentonville Five?
- Five shop stewards in the London docks in 1972, arrested after threatening to provoke a paralysing strike
- A political deadlock was reached and forced the release of the five
23 million working days lost to strikes in 1972
What caused the First Miners Strike under Heath?
- Between 1957 and 1972 the National Coal Board cut jobs from 700,000 to 300,000
- Miners wages were increasing much less than all other industrial workers
- NUM President Joe Gormley secured a 14% miners wage increase in 1971 but then lodged for a bigger claim in 1972
- The miners rejected an 8% wage offer
Describe the First Miners Strike under Heath
In January 1972 a national coal strike began
‘Flying pickets’ soon cut off the movement of coal to power stations
Heaths response was to declare a state of emergency:
- Ration electricity (using power cuts to domestic consumers and an enforced 3 day work week)
- Schools were closed
- 1.2 million workers laid off
Describe the results of the First Miners Strike under Heath
- Miners victory
- Sanction settlement negotiated by NUM leader Joe Gormley - worth between 17 and 24% to the miners
- This was another U-turn for Heath’s government
What caused the Second Miners Strike under Heath?
- November 1973, Pay Board offered the miners a 13% rise to counter rising dissatisfaction with the pay freeze
- NUM didn’t even ballot its members but rejected the offer and imposed an overtime ban
Describe the effect of the Oil Price Crisis on the Second Miners Strike
- The oil price crisis added to the miners bargaining power
- The deficit of £1 billion in 1973 reached £3 billion in 1974
- The miners situation needed a quick fix but Whitelaw was unable to break the impasse and a second strike loomed
Describe the Three Day Week during the Second Miners Strike
In December 1973 the government imposed a three-day week for the British industry
Despite predictions of a drastic fall in output, the manufacturing production in the first quarter of 1974 was 95% of normal
Describe Heaths policy towards public services
- Large increase in the educational budget
- The Minister of Health, Minister of Agriculture and Secretary for the Environment also spent freely
This added to the inflationary pressure before the Yom Kippur War
Describe race relations under Heath?
The Immigration Act passed 1971 and enacted 1973, carried the 1968 legislation to its conclusion:
- Commonwealth citizens with patrial status were allowed unrestricted entry into the UK
- Entry for citizens without patrial connections was dependent on a work permit
- All commonwealth citizens without patrial links who obtained employment in Britain were effectively reduced to a contract labourers
Describe Heath’s policy towards Ugandan Asians
In 1973, the Ugandan military dictator (Idi Amin) announced that he would give Ugandan Asians three months to emigrate
Under the 1968 quote, 3,000 were allowed to enter Britain in one year:
- The government set up the Ugandan resettlement Board and used military camps as holding centres
- 28,000 Ugandan Asians arrived
- 30,000 new jobs were created in Leicester as a result
What was the problem in Ireland in 1970?
- Inherited situation of violent Catholic versus Protestant outbreaks in Ireland
- Heath backed Brian Faulkner, the Ulster Unionist Party leader who led the Belfast government
Describe Home Secretary Maudling’s policies towards Northern Ireland
He tried to respond with a tough approach:
- Night time curfews
- August 1971, introduced policy of internment without trial
This alienated the Catholics:
McVeigh (IRA commander) - internment was ‘among the best recruiting tools the IRA ever had’
What was Bloody Sunday?
- 30th January 1972, Catholic Bogside area of Londonderry
- A civil rights march led to clashes with troops of the Parachute Regiment
- 26 unarmed civilians shot
- 13 Catholic civilians dead
What was the aftermath of Bloody Sunday?
- British Embassy in Dublin was burned down
- Support for the IRA grew as did funding from America
- 1972, bloodiest year of the Troubles = 1,382 explosions, 10,628 shootings, 480 people killed
Describe ‘Direct rule from Westminster’
- March 1972, Heath suspended the Northern Ireland government at Stormont
- Replaced by direct rule from Westminster
- Situation continues to polarise with British troops (‘security forces’) hated by catholics and the IRA escalating its campaign of violence
What was the Sunningdale Agreement?
December 1973, Whitelaw negotiated a power sharing agreement at Sunningdale:
- Power sharing executive of both nationalists and unionists, both sides guaranteed representation
- A new Assembly of Northern Ireland elected using proportional representation
- A council of Ireland that would have some input from the Republic of Ireland
What were the effects of the Sunningdale Agreement?
This sounded good on paper but in reality it failed to combat the root problems of the Catholic unrest and collapsed quickly:
- Denounced by extremists on both sides
- Opposed by the UVF and the UDA
- UUP voted to pull out in January 1974
The prospect of settlement was also undermined by the problems in Britain (miners strike and 1974 General Election)
Describe British entry to the EEC under Heath
Decision to enter the EEC approved by Parliament in 1971 and Britain was eventually accepted in 1973
Describe the reform of local government under Heath
The Local Government Act of 1972 removed old counties and imposed new boundaries in Northern Ireland. Walker also refused to allow the customary gerrymandering.
Describe the deaths and scandals in Heaths conservative government, leading up to the 1974 election
- Macleod died almost immediately
- Maudling had to resign from the Home Office in 1972 following corruption with a jailed architect, John Paulson
- Two minor members of the Government, Jellicoe and Lambton, were forced to resign in 1973 following a sex scandal involving London prostitutes
Describe the Labour party opposition in the 1974 election
The Labour party was in extreme disarray on almost every issue between 1970 and 1974 and Wilson was becoming a less and less inspiring leader. Labour slipped even further back in public support.
What the results of the 1974 election?
Nobody won:
Labour - 301
Conservative - 297
Liberals - 14
Labour forms a minority government until a second election can be called in October 1974. Here Labour wins narrowly.
Describe Heath’s economic successes
- March 1971 budget
- ‘Competition and Credit Control’
- Decimalisation in 1971
- Unemployment falls to 500,000 by 1973
Describe Heath’s economic failures
- Abolished the Prices and Incomes Board
- Inflation rising (5% to 10%, 1969 to 1971)
- Growth rate decreasing (2.5% to 1.7%, 1969 to 1971)
- 1972, 1 million unemployed
- U-turn on nationalisation (Rolls Royce and Upper Clyde Shipbuilders nationalised)
- Pound floated in 1972 and value immediately drops
- Yom Kippur War forced up price of oil
Describe Heath’s successes with the unions
- Industrial Relations Bill of 1971 appeared, on paper, to be a big step forward (At least Heath was attempting to curb the trade unions power)
- The 3-day week imposed in December 1973 was surprisingly effective and output stayed at 95% that of normal
Describe Heath’s failures with the unions
- Loopholes in the 1971 Industrial Relations Bill meant in had huge political, economic and industrial costs but no pay off
- Pentonville Five had to be released to end political stalemate
- 1972, 23 million working days were lost to strikes
- First Miners Strike paralysed the distribution of coal and Heath was forced to give in to demands
- Second Miners Strike brings down Heath’s government at 1974 election
Describe Heath’s social policy successes
- Public expenditure increases
- 28,000 Ugandan Asians allowed into Britain fleeing Ugandan dictator Idi Amin in 1973
