2 TaskIn groups you must reproduce the diagram on Conservative economic policiesYou must all produce a diagramOnly one person is allowed to look at the diagram at one time and feedback to the rest of the groupYou will only have a limited amount of time
3 1955: But Butler cuts income tax and purchase tax as there is a election coming Import controls-£50 limit on travel allowancesBank rate raised1955: Pots and pans budget on kitchen utensils1953: Income tax and purchase tax cut1951-Balance of payments and huge defence commitments1955: boom and too many importsIncrease in exports to USAR. A. Butler ( )1962-National Economic Development Councils created (NEDDY)MacmillanEconomic PoliciesSelwyn LloydDemanded halt to increasing government spendingComposed of 6 trade unionists, 6 industrialists, 2 independents and 3 Cabinet ministersWages rise faster than productivityThorneycroftHeathcoat-AmoryWanted to bring down inflation-incomes had risen by 75%1961-purchase tax raised and bank rate raised to 7%1959-economic recovery results in giveaway budgetThorneycroft resigns when Macmillan opposes thisPay Pause introducedIncome tax cut in an election winning budget
4 Chancellor Policies Butler: 1951-55 Macmillan: 55-57 n/a Balance of payments crisis and huge defence commitments led to raising of the bank rate and import controls (£50 limit on currency that could be taken out of the country). Exports to the USA led to an improved situation-in 1953 income tax and purchase tax were cut. A boom and too many exports should have led to stop policies but instead cuts were made to purchase and income tax as there was a general election. This led to a pots and pans budget were taxes were introduced on kitchen utensils.Macmillan: 55-57n/aThorneycroft:Incomes had risen by 75%. Thorneycroft wanted to cut back on government spending to prevent inflation but resigned when Macmillan opposed this as he did not want more unemployment (which cuts would produce).Heathcoat Amory:An improvement in the economic situation in 1959 led to a ‘giveaway budget’. Income tax was cut for example.Selwyn Lloyd:In 1961 income and purchase tax were increased. A pay pause was also introduced. This was because wages were rising faster than productivity. In 1962 National Economic Development Councils (NEDDYS) were introduced (they were largely useless).