Years of Concensus 1964-79: 2 Heath's gov 1970-4

Question 1

when was Heath in office?

Answer 1

1970-4

Question 2

what did Heath declare when he became PM?

Answer 2

that he was ‘adopting a new style of government’ and that he intended to ‘reduce the rise in prices, increase productivity and reduce unemployment’
wanted a hands-off approach in matters of government direction and to encourage the people to use the new freedoms to promote their own interests

Question 3

what was Heath’s nickname and what does it mean?

Answer 3

the Selsdon Man
a symbolic anti-Keynesian, pro-market politician
sometimes referred to as the new right

Question 4

what did Harold Wilson claim the Selsdon Man was designing?

Answer 4

designing a system of society for the ruthless and the pushing, the uncaring. his message to the rest of us is: you’re out on your own’

Question 5

what did the 1971 Industrial Relations Act do?

Answer 5

an extension of ‘in place of strife’
- restricted the right of workers to strike by introducing a new concept of ‘unfair industrial practice’
- a National Industrial Relations Court (NIRC) was created with the authority to judge the validity of strike action
- unions were required to put themselves on a gov register if they wanted to retain their legal rights

TUC (trade unions congress) called for unions to refuse to register as they believed it was anti-unionist. unions responded with a collective refusal to register making Heath and his cabinet appear incompetent

Question 6

who was John Davies and what did he do?

Answer 6

appointed head of the new department of trade and industry (DTI)
not a conventional politician
advised against the gov helping ‘lame duck’ businesses who performed poorly but still expected public money to bail them out

Question 7

who was Heath’s chancellor of the exchequer and what did he do?

Answer 7

Anthony Barber
- income tax cuts
- reductions in government spending
- scrapping of the Prices and Incomes Board
- cuts in the subsidies paid to local authorities

any thanks he would have received for lifting restrictions on wage bargaining was lost by his tax concession to high earners and cuts in gov spending

Question 8

what was Heath’s gov condemned for?

Answer 8

despite economic arguments for their measures they damaged public relations
- abandoning the mixed economy
- weakening the welfare state
- undermining the principle of full employment
- putting economic calculation before social improvement

Question 9

what was Heath’s U-turn?

Answer 9

inflation had risen 15% by the end of 1971 and industrial output was declining
1972 gov announced to counter inflation they were returning to a policy of controlling prices and incomes
contrary to John Davies view, when Rolls Royce hit hard times the gov nationalised it - it was sustained by gov grants
gov also authorised subsidies to Upper Clyde Shipbuilder, a Scottish company that would have been forced to close. the gov authorised a £34 million subsidy in order to keep the company going

Question 10

what were the number of strikes like under Heath?

Answer 10

highest
2922 strikes in 1974
almost 24 mill working days lost 1972

Question 11

who striked in 1972?

Answer 11

NUM led by Scargill
effectively used flying pickets to prevent the movement of coal - disrupted fuel and electricity supplies - reduced industrial production significantly

Question 12

what was the three day week, 1973?

Answer 12

rather than give in, Heath hoped to defeat them by imposing severe limits on the use of fuel
in dec 1973 he announced most industrial and commercial premises will be limited in the use of electricity to three specified days a week

electricity blackouts interfered with industrial production and left ordinary people without light and heating for long periods

Question 13

what percentage wage increase did NUM gain?

Answer 13

21% nearly 3 x what the employers originally offered
due to the success NUM struck again in 1974
Heath called an election on the issue of who ran the country: the miners or the government? the answer was to disappoint him

Question 14

what problems prevailed Heath’s gov for the Feb 1974 election?

Answer 14

• rapid inflation had made the holding down prices impossible
• the wage demands of the unions, which in the majority of cases were accepted by the employers, and the large number of days lost through strikes, resulted in a decline rather than a growth in productivity
• unemployment had not been reduced. indeed, 1972 marked the highest figure for joblessness since the depression in the 1930s
• the resort to the three-day week in 1973 showed how far the government had fallen short of its aims

Question 15

what were the results of the 1974 february election?

Answer 15

Labour won 4 more seats than Cons however lost 6% of their vote and overall Cons won more votes
Liberals performed very well vote wise but did not win many seats

Question 16

which developments occurred under Heath but the effects weren’t felt until after he left office?

Answer 16

• local gov reforms
• Britain’s entry into the EEC
• the international oil crisis

Question 17

what was the Local Government Act?

Answer 17

passed in two stages in 1972 and 1973
prepared by the environment minister Peter Walker
aimed at reshaping structure of local gov, measures destroyed many historical administrative landmarks
whole areas were subsumed into newly created regions with different names
there were protests particularly from the right wing

Question 18

what triggered Britain’s acceptance into Europe?

Answer 18

de Gaulle’s retirement in 1969 - EEC invited Britain to reapply
Heath believed the economic situation meant joining the EEC was essential
Britain signed the Treaty of Accession in 1972 which led to Britain becoming a full member on New Years Day 1973
Britain’s team of negotiators were told to ignore their concerns of political implications of entry

Question 19

how did Britain’s weak bargaining position impact their place as part of the EEC?

Answer 19

could not negotiate from a position of strength
existing members, understandably, were not going to let Britain, a late comer, change the system
EEC demanded that Britain accepted that Commonwealth food and goods would no longer enter Britain on preferential terms and would have a European tariff placed on it making it decreasingly profitable for Britain buy from from
ultimately Britain had sacrificed its ties to the Commonwealth for the EEC

Question 20

what key event happened in 1973?

Answer 20

international oil price rise
OPEC (organisation of petroleum exporting countries) were establishing greater control over their oil industries
in 1973 Arab members of OPEC used oil as a weapon in their conflict with Israel
the West’s support for Israel meant that Arab members drastically reduced their oil supplies
OPEC had also increased their prices for $2 a barrel to $35 - main target was US however many Western states suffered

Question 21

what were the economic effects of the oil crisis for Britain?

Answer 21

• balance of payments deficit rose to £1 billion
• annual inflation rate rose to 16%
• value of sterling dropped to $1.57
• interest rate was raised to 15%
• a record budget deficit occurred
• between 1974 and 1976 the unemployment figures more than doubled to 1.44 million and remained high for the rest of the decade

Labour gov would suffer the full effects of this 1974-9