Callaghan 1976 - 1979
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- Created on: 04-01-18 14:53
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- Callaghan in Power 1976 - 1979
- James Callaghan
- became lesser, beating the left-wing Michael Foot
- Callaghan was the most experienced
- he had been chancellor 1964-1967 before the devaluation crisis
- he had also been Home Secretary & Foreign Secretary
- became lesser, beating the left-wing Michael Foot
- IMF Crisis 1976
- in Sept 1976 Britain faced national bankruptcies as inflation ran almost out of control
- this was partly due to the effects of the 1973 oil crisis but also by B's industrial decline & national debt
- the govt. was forced to apply to the IMF for a £3.3bn loan to save B going bankrupt
- this was humiliating as only 3rd world countries usually applied for IMF loans
- the IMF would only grant the loan if the UK govt. agreed to make big cuts in spending on public services eg the NHS, pensions & schools
- however, only half the loan was used and the govt. paid it back ahead of schedule
- the value of the pound stabilised
- inflation reached a record high of 24% in 1975, but was down to 8.3% in 1978
- Devolution
- Devolution Acts
- acts for Scotland & Wales passed opening the way for a referendum
- the terms of the referendum were set up in a way that devolution was unlikely to pass
- 1st March 1979
- Scotland turnout 62% Yes 51% & No 48.4%
- Wales turnout 59% Yes 20.3% No &9.7%
- the rules stating that a simple majority was not enough meant devolution was defeated
- disappointed Scottish Nationalist MPs withdrew their support from Lab
- 1977 C created the 'Lib-Lab Pact' to defeat a vote of no confidence
- 12 Lib MPs agreed to vote with Lab & in return C promised to move ahead with devolution
- majority of Cons & many Lab against devolution, but after lengthy debates 1978
- Devolution Acts
- The Winter of Discontent
- autumn 1978 the TUC rejected Labs proposed wage increase limit of 5%
- this encouraged TUs to put in higher demands
- Ford lorry drivers received a 15% increase in December after a 9 week long strike
- the wave of industrial action inc. disruption to transport with lorry drivers & train drivers from TU ASLEF
- strikes by public sector workers eg hospital porters, clerical staff in local councils, dustmen & gravediggers caused outrage
- the disputes were brought to an end March 1979
- average wage increase received was 10% but the psychological effect had devastating impact on public mood
- James Callaghan
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