Reasons for Labour's victory
The failures of the Conservatives:
- Previous Conservative governments had not understood the needs of the ordinary working people.
- The public remembered the Conservative governments inability to deal with the economy during the 1930s - leading to the great depression.
- The appeasement policy put in place by the Conservative government had failed to prevent war from occuring.
- The Conservatives election campaign was ill-judged.
- The government was deemed old fashioned: they would not introduce new social and economic changes that the country needed.
- Churchill wasn't seen as a reliable domestic politician.
- The Labour party presented the zeitgeist of the public.
- Labour were generally seen as better fitted to carry out post-war construction.
- Labour figures had gained respect and credibility during the war.
- The electoral system worked in Labour's favour.
Creation of the welfare state
- Beveridge report - identification of '5 giant evils'.
- The Education Act 1944 - free compulsory secondary education.
- Family Allowances Act 1945 - weekly payments for each child after the first.
What did it include?
- NI - regular financial contributions to a central fund which meant that you could receive payments in times of need, such as unemployment or sickness.
- NHS - free medical and hospital treatment regardless of status or income.
- National Assistance Act - help for those suffering from serious hardships.
- Industrial Injuries Act - covered accidents in the workplace
Resistance to the NHS
- The resistance of the medical profession delayed the setting up of the NHS by a year.
4 objections to the NHS:
- Doctors did not want to become mere salaried civil servants of the government.
- Doctors feared government interference in doctor-patient relations.
- Doctors were concerned that management boards, run by the NHS, would take away their independence as a practitioner.
- Doctors saw the NHS as a form of nationalism - which treated the medical profession as an industry.
Provisions of the NHS:
- Primary care given by GPs, who would work as independent contractors and be paid for each patient on their books.
- Dentists and opticians would provide both NHS and private treatment.
- Hospitals would be run by regional management boards.
- Maternity care, vaccinations and ambulance services were to be provided by the local authorities.
- Medical prescriptions would be free.
Failures of the NHS
- Working class still did not receive as much.
- Middle class prospered more, as they had access to the best practices and doctors.
- People wasted GPs time with trivial complaints - 'dandruff syndrome'.
- Providing patient care was not being fufilled - many of the managerial and administrative positions did not directly relate to treatment for patients - bureaucracy.
- The government had the right to direct the key aspects of the economy.
- Nationalisation would bring greater safety, productivity and efficiency.
The Nationalisation programme:
- 1946 - coal, civil aviation, Cable & Wireless & Bank of England.
- 1947 - road transport and electricity.
- 1948 - gas.
- 1949 - iron and steel.
The opposition to the nationalisation of steel:
- It was not owned by the public.
- It was successful and making profits.
- Large investments had recently been made into it.
- It had an excellent record of employer-employee relations.
- The government should use its budgets and revenue powers to raise capital, which it could then reinvest in the economy.
- A boost in the economy would lead to genuine recovery and growth.
- Earnings would be spent on goods and services, resulting in the forces of supply and demand being stimulated.
- The government should not always try to balance the budget between income and expenditure - it should be willing to run deficit budgets.
The government's financial problems
By the end of the war, Britain was burdened with the following:
- Debts of £4198 million.
- A balance of payments crisis (cost of imports was greater than the profit from exports).
- Exports had dropped by 60% during the war.
- The sale of invisible exports declined during 1938-1946.
- The cost of maintaining overseas military commitments had increased by five times the amount between 1938-1946. Spending 14% of GNP - led to austerity measures e.g rationing & wage freezes.
- Economic blizzard - fuel shortages, cuts in domestic and industiral electricity supplies, workers were laid off.
In order to meet the demands of the crisis, a loan was necessary. A loan of $6000 million was negotiated from the USA and Canada.
- The hope was that as Britain's economy recovered, the pay back of the loan would be relatively easy.
- The recovery never happened, due to the dollar gap.
The Marshall plan 1947
After 1945, the only country/economy with sufficient resources was the USA. Concerned with the spread of Communism, and in order to allow their own economy to grow, they adopted a programme to provide dollars to any country that would grant trade concessions to the US.
- Europe received $15 billion, with Britain taking 10%.
- Further tied Britain to the USA.
- Indian independence 1947 - during WWII Britain began to realise that the burden of being an Imperial power was too much.
- Implemented a large scale nationalisation programme.
- Created the welfare state.
- Helped to convince the USA of the need for the Marshall plan.
- Initiated a major housing programme, resulting in a million new homes being built.
- Played a key role in the formation of NATO.
- Started the programme that turned Britain into a nuclear power.
Reasons for Labour's 1951 defeat
- The government was worn down by heavy economic and financial difficulties.
- Serious divisions had developed between the right and the left of the party.
- A number of the ministers had been working continuously since 1940.
- There was resentment among some trade unions at Labour's slowness in responding to workers' demands.
- The Labour party image was damaged - they were associated with rationing and high taxation.
- Britain's entry into the Korean war angered the left of the Labour party.