Wilson/Callaghan Problems 1974-79 Flashcards
(9 cards)
What 3 political problems did he face?
- drift to the left of Labour Party
- divisions over Europe
- formation of the lib lab pact
How did he solve the drift to the left of the Labour Party?
Was this successful?
Appointed Micheal Foot and Tony Benn to the cabinet
Yes cabinet all agreed on “left” policies
How did he solve the divisions over Europe?
Was this successful?
Renegotiated terms of the EEC to reduce Britains budget to it
Held a referendum on the 5th June 1975
Yes, as buried the issue of Europe and preserved Labour unity
What economic problems did he face?
- stagflation (inflation 30%)
- need for IMF loan
How did he try to solve stagflation? Was this successful?
Chancellor Healy tried to conquer inflation eg. In the 1975 budget cuts to gov spending and raising taxes
No, inflation fell but still poor productivity, BOP defector and verge of bankruptcy
How did they achieve the IMF loan? Was this successful?
cut gov spending by £2 billion to get the IMF loan of $3.9 billion
Yes, prevented servere economic crisis, but alienates the left wing MPs and unions
What social problems did they face?
- issues with the unions
- winter of discontent
How did they solve issues with the unions? Was this successful?
Social contract 1973
Signed between TUC and gov to limit pay increase and improve workers rights
Partial successs as days lost to strikes decreased and they began to work together
BUT broke in 1978 due to winter of discontent
How did they solve the winter of discontent? Was this successful?
Gave pay increase
Partial success as it settled strikes but added to perception that Labour can’t control the unions or manage economy
