The Labour Government 1974-1979 Flashcards
What type of government did Labour form after the February 1974 election?
Labour formed a minority government after the February 1974 election.
What was the situation of the Labour government after the October 1974 election?
After the October 1974 election, Labour formed a government with a slim majority of three seats.
Which two figures were seen as powerful on the left wing of the Labour Party by 1974?
Michael Foot (Department of Employment) and Tony Benn (Secretary of State for Industry) were seen as powerful figures on the left wing of the Labour Party by 1974.
What issue caused division within the Labour Party in 1974?
The Labour Party was divided over the issue of Britain’s membership in the EEC (European Economic Community).
What did Harold Wilson do to resolve the Labour Party’s division over the EEC?
Wilson decided to hold a referendum on Britain’s membership in 1975, allowing cabinet members to campaign for either side.
What was the result of the 1975 referendum on Britain’s membership in the EEC?
The result of the 1975 referendum was 67% in favor of remaining in the EEC.
How did the 1975 EEC referendum impact the Labour Party?
The referendum helped to bury the issue of Europe within the Labour Party and preserved the party’s unity.
What health issues did Harold Wilson face that led to his resignation?
Wilson began to suffer from health difficulties, including memory loss and exhaustion, which led to his resignation.
What was controversial about Harold Wilson’s resignation in 1976?
Wilson’s resignation was controversial due to the publication of his “Resignation Honours,” known as the Lavender List, which included knighthoods and peerages to businessmen and was seen as arbitrary.
Who replaced Harold Wilson as Prime Minister in 1976?
James Callaghan, a figure in the centre-left of the party, replaced Harold Wilson as Prime Minister in 1976.
What caused the Labour government’s majority to erode by 1977?
By 1977, by-election defeats had eroded the government’s majority, forcing Callaghan to negotiate a ‘Lib-Lab’ Pact with the Liberal Party to remain in government.
What was the ‘Lib-Lab’ Pact and when did it happen?
The ‘Lib-Lab’ Pact was negotiated in 1977, where the 13 Liberal MPs agreed to support the Labour government in exchange for some Liberal policies.
When did the ‘Lib-Lab’ Pact collapse?
The ‘Lib-Lab’ Pact collapsed in 1978.
What new pact did Callaghan agree to in 1978?
In 1978, Callaghan agreed to a new pact with nationalist parties—Plaid Cymru in Wales and the Scottish National Party (SNP)—for support in exchange for referendums on devolution.
What happened when the devolution referendums failed?
When the devolution referendums failed, the nationalist parties withdrew their support from the Labour government.
What event led to the collapse of Callaghan’s government in 1979?
The government collapsed in 1979 after losing a ‘vote of no confidence’ by a single vote, sparking a general election.
What was the inflation rate in 1975?
Inflation reached nearly 30% by the middle of 1975.
What caused inflation to rise in 1974?
Inflation rose in 1974 due to a 29% pay rise given to miners, which led to wage increases demanded across the trade union movement.
What was the unemployment rate in 1976?
Unemployment rose to 1.3 million in 1976.
What economic policy did Denis Healey, Chancellor of the Exchequer, pursue from 1974-1979?
Denis Healey pursued a deflationary policy to control inflation and reduce government spending.
What was the ‘rough, tough’ budget of 1975?
The 1975 budget increased taxes and cut government spending. Income tax rose by 2%, VAT of 25% applied to more goods, and proposed spending cuts were £1.29bn.
What incomes policy did the government propose in 1975?
In 1975, the government proposed an incomes policy with a £6 per week ceiling on wage increases and a freeze on higher incomes.
What was the result of the incomes policy introduced in 1975?
The TUC reluctantly accepted the incomes policy in 1975, and the wage ceiling was reduced to £4 per week in 1976.
What were the average wage increases from 1975 to 1977?
Average wage increases dropped each year: 26% in 1975, 15% in 1976, and 10% in 1977.
What was the state of inflation by 1977 despite economic policies?
By 1977, inflation had fallen but remained high at 15%, and the economy was still stagnant with a balance of payments deficit.
What did Callaghan announce in 1976 about the Labour Party’s economic poliCY?
In 1976, Callaghan announced that Labour could no longer spend its way out of a recession, renouncing its previous economic policy.
What caused the UK to seek an IMF loan in 1976?
International investors lost confidence in the pound, leading to a drop in its value. The Bank of England spent $5.5bn to stabilize the pound and sought a $3.9bn loan from the IMF to prevent bankruptcy.
What were the terms of the IMF loan in 1976?
The IMF loan was granted on the condition that the British government accepted £2bn worth of spending cuts.
What happened to the Labour Party’s image due to the IMF loan in 1976?
The IMF loan was humiliating for the Labour Party, damaging its image as the government had to go “cap in hand” to the IMF and accept imposed terms.
When was the Industrial Relations Act repealed?
The Industrial Relations Act was repealed in 1974.
What agreement replaced the Industrial Relations Act after its repeal?
The Industrial Relations Act was replaced by the ‘Social Contract’ brokered in 1973 between the Labour Party and the TUC.
What were the key terms of the Social Contract?
The Social Contract involved unions agreeing to cooperate in controlling wage increases, while the government promised to keep prices down and improve welfare provision, with no statutory incomes policy.
What marked the start of the Winter of Discontent in 1978-79?
The Winter of Discontent began in December 1978 when Ford workers won a 15% pay increase after a three-month strike, above the government’s 5% wage ceiling.
Which group went on strike in January 1979 demanding a 30% pay increase?
Lorry drivers went on strike in January 1979 demanding a 30% pay increase, disrupting deliveries and fuel supplies.
What group of workers made striking claims during the Winter of Discontent, and how did it impact public perception?
The National Union of Public Employees (NUPE), representing low-paid public sector workers like rubbish collectors and grave diggers, went on strike. Public perception was impacted as dramatic claims were made about unburied dead and rubbish piling up in streets.
What was James Callaghan’s controversial statement during the Winter of Discontent in 1979?
While in the Caribbean during the Winter of Discontent, Callaghan said, “I don’t think that other people in the world would share the view that there is mounting chaos,” which was paraphrased by The Sun as “Crisis? What Crisis?” portraying him as out of touch.
