Explain why the Labour government 1945-51 implemented nationalisation of key industries

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Explain why the Labour government 1945-51 implemented nationalisation of key industries
(12 marks)
Nationalisation had been a long-held belief of the Labour Party ever since the establishment of their
policies in the party's constitution of 1918. Clause IV, first drafted in 1917 by LSE founder Sidney
Webb, clearly outlined the party's aims and values, in particular the need for nationalisation in order
to reduce the surplus of uncoordinated and competing companies. Attlee's 1945
government was therefore supportive of taking industry into public ownership and having state
control of the economy by implementing nationalisation. It would reinforce the Labour party's firm,
almost socialist, ideologies of putting people before profit, unlike those of the capitalist private
factory owners.
Secondly, nationalisation was introduced in 1945 due to the practical possibilities of being in
government and having post-war support. For the first time Labour had won an election with a
majority and so they could use this power to push their policies through parliament without the
restrictions of minority government pressure. Unlike Ramsay MacDonald's earlier Labour
governments, Attlee also benefited from the contribution of experienced politicians and economists
such as Aneurin Bevan, Stafford Cripps, Herbert Morrison and John Keynes who could structure a
planned economy to ensure Labour's social ideals became reality. Furthermore he had the support of
the public who, after six years of total war, had come to see the advantages of State ownership and
control, and so Labour's proposal of nationalisation was made credible and became widely accepted.
Not only traditional Labour supporters but also the middle-class and businesses believed in the
nationalisation of failing industries. These factors contributed to the reasons for Labour's introduction
of nationalisation by making it politically possible for Attlee's 1945 government.
Most importantly the Labour government implemented nationalisation as they felt that the economic
benefits of the policy were self-evident and outweighed the alternative - private ownership. It was
believed that nationalisation would lead to greater national efficiency by ensuring full employment
and solving the unemployment issues arising after the closure of munitions factories. Some
industries, such as coal mining and railways, had suffered decades of under-investment and poor
labour relations, so were sorely in need of modernisation. The coal mines had been exhausted by the
relentlessness of war with poor working conditions and low wages becoming increasingly evident by
the workers' decline in health, and total nationalisation seemed to be the only solution to their
otherwise irreversible decline. Furthermore, it would enable the state to exercise greater control
over essential industries, thus making it easier for the government to plan the economy, increase the
possibility of full employment and encourage investment. Therefore the greater efficiency of
industries which nationalisation was predicted to bring about, contributed to the Labour
government's decision, although its implementation depended upon the support of the workers to
whom these radical changes would be politically attractive.
To conclude, the government's decision to implement nationalisation of key industries was the result
of several factors: first of all, the Labour government was ideologically pre-disposed towards
nationalisation as a concept of industrial management; secondly, the government had the means to
put their ideals into practice for the first time since its formation and thirdly, yet most
importantly, the government firmly believed that the electorate was behind them, that private
ownership had failed, and a more efficient and profitable future for large industries lay in


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