Reasons for Consensus Progressive Conservatives: Eden was a One-Nation Tory Macmillan wrote The Middle Way in 1938 in which he showed sympathy for radical solutions Butler was the driving force behind the 1944 Butler Act Wilson and Callaghan (both Labour) were dependent on trade union support
Reasons for the end of consensus By the 1970s Keynesianism wasn't working Conservatives wanted free-market policies Some Conservatives felt that the unions had too much power Heath tried to break it Neither party had much to offer so the Liberals grew in support in the 60s and 70s (under Jeremy Thorpe) but failed to recover fully due to the First Past the Post system Winter of Discontent (1978-9) The most votes in a constituency wins. Therefore a PM can be elected with the fewest votes but most seats
Eden (1955-57) Took over when Churchill retired then called an election One-Nation Tory Wanted Britain to be taken seriously in foreign affairs Very low unemployment Fell due to Suez crisis Agreed to invade but was forced to pull out when America threatened to sell their Pound reserves (which would cause inflation) Resigned
Macmillan (1957-63) Replaced Eden when he resigned Popular government Mixed economy Low unemployment Waged and living standards very close Wrote The Middle Way in 1938 in which he showed sympathy for radical solutions Stagflation 1959 important Conservative members resigned (including Powell) as they felt the government was spending too much 1962 Night of the Long Knives Spy scandals Resigned due to ill health
Douglas-Home (1963-64) Took over when Macmillan resigned Many people did not like his image – very upper class
Wilson (1964-70, 1974-76) Won in 1964 as his party was classless. Used TV. Promised welfare and to increase military presence abroad Made improvements to education Department of Economic Affairs (1964) under George Brown. Brown came up with a National Plan but it lacked government resources or good relations with the treasury 1966 National Seamen’s Strike Devalued the pound 1967 – unpopular (opposed by Callaghan) Was refused entry to the European Economic Community 1969 Barbara Castle proposed curbing union power but was never passed as it worried Wilson (even though he initially agreed)
Heath (1970-74) Won due to problems in with Wilson’s government: Rising unemployment Union unrest Also won due to new manifesto Tax cuts Wages should not be set by the government Remove the state from peoples’ lives Organisation of Petroleum Exporting Countries raised oil prices by 70%. The cost of energy rose The Industrial Relations Act failed to reduce union power as unions were not forced to sign up the National Industrial Relations Court 1970s wages failed to keep up with prices 1971 National Union of Miners strike Pay Board created to examine pay deals and a Price Commission to limit price increases for some companies 1973 strike: teachers, hospital staff, train drivers, Ford workers and gasmen 1974 NUM strike Fell due to: The failure of the ‘Barber budget’ (tax cuts) Selsdon Group – Conservatives who wanted a free-market policy Forced to call a state of emergency due to NUM strike Failure of ‘Who runs Britain?’ campaign ‘Who runs Britain?’ – unions or government
Wilson (1964-70, 1974-76) 1974 election was a hung parliament (no majority) Repealed the Industrial Relations Board Returned to corporatism Formed the Social Contract From 1976 was forced to cap spending and wages due to inflation (fuel prices) Growth of unemployment in the 60s and by 1976 unemployment was at 1.5 million The party was split Resigned in 1976
Callaghan (1976-79) Took over from Wilson when he resigned in 1976 Started to abandon consensus Clashed with Tony Benn Divisions within the party 1978 Ford car strike 1979 Public Sector and haulage strikes
Consumer spending increased which meant the economy struggled Unemployment 2% Rise in living standards Decline of British empire Economy grew slower than in other countries 1960s 1963 Unemployment 878, 000 Exports became less competitive Stagflation IMF loans 1970s Inflation Unemployment 6% Consumer spending increased which meant the economy struggled
Economic Policies Problems Solutions Success or failure Inflation Unemployment Welfare Deficit – too much spending on defence Devaluation of the pound, tax, interest rates, stop-go NEDDY, NICKY IMF loans Stop-go policies meant businesses were reluctant to invest- slow economy 1957 Rent Act increased rents for lowincome earners + hit them hard