UNIT The Labour Party in power 2 – victory and reform – Britain 1945 L A What is this unit about? I This is an attempt to show why the Labour Party won such a convincing victory in July 1945 and then why and how the new government carried out a major series of reforms affecting both welfare and the economy in the period 1945 to 1948,R despite massive economic problems. It also examines the effects of having to negotiate a major loan from the USA to under-pin the much weakened British EDEXCEL economy. E

Key questions T • Why did the Labour Party win the general election of July 1945 with a large BY majority? • What were the key features of the reforms carried through?A • How important was the USA in providing financial help? M Timeline

1945 7/8 May End of the war in Europe 23 May Churchill ends wartime coalitionE 4 June Churchill’s ‘Gestapo’ radio broadcast 5 July General Election leads to LLabour victory 26 July Attlee forms the first majority Labour Government 21 August Truman ends Lend-Lease September Japan surrendersP and Second World War ends December US loan agreement

1946 March Bank of Nationalised ENDORSED Bevan unveils plans forM May Trades Disputes Act repealed Bread rationing announcedA National Insurance Act National HealthS Services Act YET December Coal shortages shuts down some industries

1947 January Coal mines and Cable and Wireless nationalised February Severe cold – energy crisis worsens March Gales and flooding NOT 1 Consensus and Conflict: British Political History 1945–90

April School leaving age raised to 15 Dalton’s third Budget include tax rises July Sterling becomes convertible – sterling crisis Government draws up ‘famine food programme’ August Food rations cut and petrol rationL abolished – no motoring for pleasure September Cabinet plot to remove Attlee as Prime Minister fails October Foreign travel allowance abolishedA November Dalton resigns over budgetI leak and is replaced by Cripps Potato rationing introduced

1948 January Railways nationalised March Last £25 million of USR loan drawn April European Recovery Programme (MarshallEDEXCEL Aid) begins Electricity nationalised E First Budget by Cripps announced May British nuclearT bomb programme announced to the public 5 July National Health Service inauguratedBY A The end of the Coalition The German Army surrendered at Rheims on the 7 May 1945. Just two weeks later the CoalitionM government came to an end and Britain returned to traditional competitive party politics. Churchill, Attlee and Bevin favoured continuing the coalition until Japan was defeated, which it was expected would take until 1946. However, a Labour Party conference at Blackpool pushedE Attlee into a decision to end the coalition by October. On the 21 May he telephoned Churchill to this effect and Churchill decided that in thisL case the sooner the coalition ended the better and the earlier the election, the better it would be for the Conservatives. It was felt by most politicians and knowledgeable commentators that Churchill, as the great leaderP of the war, would carry the Tory party to victory. Attlee was not optimistic and the best he hoped for was a reduced Conservative majority. ENDORSED OnM 23 May the coalition came to an end and Churchill formed a ‘caretaker’ Tory cabinet until an election could be held. It was decided that Parliament would be dissolved on 5 June and voting would take place on 5 July. The Avotes would not be counted until 25 July to allow the many millions in uniform a chance to vote and their ballot boxes to be collected. There were many soldiersYET still fighting the Japanese in Asia and a sizable British fleet S in the Pacific. In addition there was a very large British garrison occupying defeated Germany. This would make for a very unusual election. Although the country was about to return to party politics with the usual trading of insults and competitive jibes, the war in a very real sense had established a comradely consensus. Young MPs of both parties had served NOT 2 The Labour Party in power, Britain 1945

1111 in the forces. Captain Roy Jenkins and Major Dennis Healey of the Labour 2 Party now faced Lt. Colonel Heath and Brigadier Enoch Powell of the 3 Tories. All had been civilians before the war and many had taken the 4 opportunity war provided to demonstrate their abilities. Powell, for 5 example, had risen impressively from Private to Brigadier without any 6 means other than his own skills. Leading Labour politicians had served forL 7 five years alongside leading Conservatives in the coalition government. 8 Attlee and Sir Anthony Eden, Churchill’s deputy, addressed one another 9 in letters as ‘My dear Clem’ and ‘My dear Anthony.’ Churchill had a veryA 1011 real respect for his Labour Party colleagues, particularly Attlee and Bevin. 1 At a farewell meeting in the cabinet room tears poured down his faceI as 2 he declared that ‘The light of history will shine on every helmet’. This was a 3111 far cry from Neville Chamberlain’s attitude to the Labour front bench in 4 the 1930s. When urged by Baldwin not to treat them like dirt heR replied 5 ‘Intellectually they are dirt.’ 6 EDEXCEL In 1945, not only was there a personal consensus of men whoE had served 7 together in a common cause, there was also a wide consensus of what had 8 to be done. 9 T 20111 • Both parties essentially agreed on foreign policy. Bevin, no less thanBY 1 Churchill, could not think of Britain as other than a great power with 2 world-wide responsibilities. A 3 • Both parties supported a close relationship with the USA, maintaining 4 something like the war-time alliance. 5 • Both parties embraced an extension of welfareM at home. Churchill’s 6 caretaker government introduced child allowances in its short existence 7 and Butler had already established the broad pattern of post war 8 education policy with his 1944 Education Act. 9 E 30111 However, with an election to fight, consensus was about to give way to 1 conflict, even if much of the conflict wasL false. 2 3 The 1945 General Election 4 P 5 Churchill would be standing in his North constituency of 6 Woodford, which he was expected to win comfortably and as the cartoonist 7 ‘Vicky’ points out the Conservatives tried to give ENDORSEDthe impression that he 8 was standing everywhere. M 9 The Tories were relying heavily on Churchill for victory as Source A 40111 makes clear. He toured theA country in a grand cavalcade. Attlee, in 1 contrast, energetically campaigned up and down the land driven by his 2 wife Vi in his little Standard motor car. TheYET two leaders’ styles inevitably 3 reflected their differentS personalities but Attlee was to be no push over. 4 On the 4th June, the day before Parliament was dissolved Churchill opened 5 the election campaign in a radio broadcast with a typical bombastic salvo 6 aimed at the Labour Party. 7 8222 The next day Attlee effectively demolished his opponent. NOT 3 Consensus and Conflict: British Political History 1945–90

Source A

L SKILLS BUILDER Look carefully at A Source A. What is the message of this I cartoon? R E EDEXCEL T 2.1 Cartoon by ‘Vicky’ in the News Chronicle, 30BY May 1945 A Source B Source C No Socialist Government conducting the entire life M When I listened to the Prime Minister’s speech last and industry of the country could afford to allow free, night, in which he gave such a travesty of the policy sharp or violently worded expression of public of the Labour Party, I realised at once what was his discontent. They would have to fall back on some object. He wanted the electors to understand how form of Gestapo, no doubt very humanely directedE in great was the difference between the first instance. the great leader in war of a united nation and Mr Churchill speaking on the radio, 4L June 1945 Churchill, the Party Leader of the Conservatives. He feared lest those who had accepted his leadership in war might be tempted out of gratitude to follow him P further. I thank him for having disillusioned them so thoroughly. ENDORSEDAttlee speaking on the radio, 5 June 1945 M

A SKILLS BUILDER Using SourcesYET B and C S In what ways do the two party leaders hope to win support in their two party political addresses on the radio?

NOT 4 The Labour Party in power, Britain 1945

1111 Many, including Conservatives like R.A. Butler felt that this broadcast 2 damaged the Conservatives and some historians still point to its role in the 3 election result. 4 Other historians disagree and down play its importance. 5 6 L 7 Source D Source E 8 9 That elaborate confection of rhetorical exaggeration Churchill revertedA to type as a narrowly partisan 1011 did Churchill great harm. It made him sound ludicrous campaigner. Afterwards, one of his extravagant 1 rather than eloquent, a crude partisan rather than the claims, thatI the same Labour colleagues with whom 2 wise statesman above the fray. It was gift to the he had worked for five years against Hitler were 3111 Labour Party such as few Conservative leaders have about to introduce their own Gestapo into Britain, 4 presented in twentieth century elections and Labour was blamedR for losing votes. But according to the 5 made effective use of it, starting with Attlee himself opinion polls, the ConservativesEDEXCEL actually gained 6 when he broadcast his reply. supportE during the campaign; in the spring of 1945, 7 Extract from Never Again, Britain 1945–51 they were 20% behind Labour and closed the gap to 8 by Peter Hennessy, published 1992 8% on polling day in July. 9 T Extract from Hope and Glory: Britain 1900–2000 by 20111 BY Peter Clarke, published 1996 1 2 A 3 SKILLS BUILDER 4 5 Use Sources C, D and E and your own knowledgeM to assess how far 6 Churchill’s broadcast of 4 June damaged the Conservative Party? 7 8 9 Why did Labour win? E 30111 Labour had many advantages going into the election. They were 1 consistently ahead in the opinion polls,L as Source E makes clear, as the 2 Conservatives were paying the penalty for all the suffering and mistakes of 3 the 1930s. The level of unemployment was held against them and fears of 4 its return were widespread. The MunichP meeting with Hitler and the policy 5 of appeasement were now looked on with derision and people blamed the 6 Conservatives who were in government at the time. The fact that Churchill 7 ENDORSED had opposed it did not now seem to count, nor did the fact that the Labour 8 M Party had consistently opposed rearmament until 1939. The sins of the past 9 were heaped onto the Tory Party and the Labour Party, as the opposition, 40111 was absolved. 1 A 2 The long standing hostile attitude of the bulk of the British press had been 3 partially reversed by theS shift of the DailyYET Mirror to support Labour just 4 before the war. Lord Beaverbrook’s Daily Express was still hostile to Labour, 5 as was the Daily Mail, but the Mirror’s circulation was increasing rapidly, 6 and by 1950 it had become the biggest circulation paper in the country. 7 Labour also appeared better organised than the Conservatives. Dalton told 8222 John Colville that whilst during the war ‘the Tories had left the constituencies NOT 5 Consensus and Conflict: British Political History 1945–90

unattended, their agents being for the most part away fighting, he ,like Herbert Morrison, had spent much time and effort in ensuring that Labour’s electoral machinery was in good order’. The Labour campaign was also more professional with the effective targeting of marginal seats where just a small shift in support could win them the constituency.L Perhaps most important of all, there was a mood change since the last election of 1935. Deference had declined and there was clearly an increased faith in the power of the state toA produce a fairer society in which old evils should be and could be removed. This was not a spirit of revolution but one of faith that the countryI which had defeated an intolerable moral evil in the shape of Nazi Germany could now slay Beveridges’ giants of evil – WANT, DISEASE, IGNORANCE, SQUALOR and IDLENESS. The Archbishop of RCanterbury since 1942, William Temple, was a socialist sympathiser and many now of all classes felt that the time was right ‘to build Jerusalem in England’s green andEDEXCEL pleasant land’ to quote the lines from the popular hymnE Jerusalem. Attlee, who in many ways, was a deeply traditional figure, attached as he was to cricket and his old publicT school, embodied this feeling and expressed it effectively in his radio responseBY to Churchill. He argued that the Labour Party was now the all embracing national party representing ‘all the main streams whichA flow into the great river of our national life’. By comparison the Conservatives were a ‘class party’ representing ‘property and privilege.’ This seems to have struck a chord with the electorate. The party which had dominatedM British elections since 1918 now seemed old fashioned. It was time for a change and the Labour Party cashed in on this mood of the country. Churchill’s attempts to scare the electorate were E Source F L SKILLS BUILDER Look closely at P Source F. How does the ENDORSED cartoonist show his M disapproval of the Conservative campaign regarding A the importance of Laski within the YET Labour Party? S

2.2 Cartoon by George Whitelaw published in the Daily Herald, 4 July 1945 NOT 6 The Labour Party in power, Britain 1945

1111 unconvincing. After the Gestapo reference there was then a concerted 2 attempt to emphasise the power and influence of the Left in the Labour 3 Party, embodied in the person of Professor Harold Laski of the London 4 School of Economics who was elected Labour Party Chairman in May. 5 The Beaverbrook press ran a campaign stressing his influence. Source G 6 L The electorate rightly remained unconvinced of his influence. He had tried Dear Laski, 7 to persuade Attlee to resign in a long memo to the Labour leader, written 8 Thank you for your letter, on the 24th May. Attlee’s response was a typically terse one. 9 A contents of which have 1011 I been noted. 1 S IL S UIL E C.R. Attlee 2 K L B D R Letter from Attlee 3111 Read Source G to Laski written in 4 R How far does Attlee’s letter indicate that Laski exercised limited response to a long 5 letter sent by Laski to influence on Attlee as leader? EDEXCEL 6 E Attlee on 24 May 1945 7 8 9 Who won the election? T 20111 The results of the election were a national landslide; 432 ConservativesBY 1 had been elected in 1935. Now there were only 213.A Only 154 Labour 2 MPs had been elected ten years previously, now there were 393. There 3 were only 12 Liberals returned compared with 20 in 1935. In almost every 4 region Labour did well. They had a convincing majority in London and 5 even a slight majority in the rest of southern England,M which was 6 traditionally Tory. In the North, Midlands and Wales Labour was 7 comfortably ahead. was much closer than might be expected given 8 the near elimination of the Conservatives in Scotland by the 21st century. 9 Labour was ahead but by only 37 to 29. InE every region, Labour had won a 30111 majority of the seats and now for the first time in the history of the Party 1 could form a government with a strongL base in Parliament. Labour’s 2 programme could be carried out, as long as the state of the economy 3 allowed it. 4 P 5 6 Forming a government 7 Churchill and Attlee were both somewhat surprisedENDORSED by the result, which 8 became clear on the 26 July. Churchill’sM wife sought to comfort her 9 husband with the suggestion that it might be a blessing in disguise. 40111 Churchill grumpily retorted that at the present it was very effectively 1 disguised. Attlee immediatelyA faced a plot to replace him organised by 2 Herbert Morrison, who suggested that there be a leadership election 3 amongst the new MPs,S an election MorrisonYET expected to win. Ernest Bevin, 4 the Labour heavyweight, in every sense of the phrase, suggested that Attlee 5 go to the palace immediately and get appointed before Morrison could 6 organise anything. Attlee was promptly driven to Buckingham Palace by 7 his wife, and after expressing his surprise to the King at being there, 8222 accepted the King’s commission to form a government. As Morrison NOT 7 Consensus and Conflict: British Political History 1945–90

Biography Biography

Herbert Stanley Morrison Sir Richard Stafford Cripps The son of a London policeman, Morrison had left Born into a wealthy legal family, he himself became school at 14. He rose through local politics to become a very successful barrister.L He was a devout Christian the Leader of the GLC (Greater London Council) from and this brought him into left-wing politics. He was 1934–40. He was a London MP and served in the a major opponent of re-armament in the 1930s and Labour Cabinet of 1929–31 but lost his seat in that supporter of the A‘Popular Front’ in opposition to year and so missed his chance to become leader fascism but never saw any incompatibility between when Attlee succeeded George Lansbury in 1935. his two positionsI which irritated realists like Bevin He returned to Parliament later that year in the and Dalton. He became a major figure in Churchill’s General Election and he always felt that he deserved war-time Rgovernment. He was personally austere to be leader rather than Attlee. He served in as a vegetarian and teetotaler and a suitable Churchill’s war-time government as Home Secretary Chancellor of the ExchequerEDEXCEL for the period of and as a senior figure in the war cabinet from 1942. maximumE austerity from 1947 onwards, when he He became very proud of his quiff, which the replaced Dalton. cartoonist David Low made famous (see Source X, unit 1, page XX). T BY A Biography M Known as Nye Bevan, he was the son of a Welsh miner and went into the mines himself at the age of 13. He rose rapidly as a union official and became Labour MP for Ebbw Vale in 1929. He was an inspired and inspiring speaker and became a noted left-wing member of the party. He was one of the few to criticise Churchill during the war who responded by describing him as a ‘squalid nuisance’.E He clashed frequently with Bevin who in response to the advice ‘Never mind Nye, he’s his own worst enemy’, famously retorted ‘Not while I’m alive, he isn’t’. He often appeared lazy and vain but he proved himselfL an able administrator at the Ministry of Health. P continued to make trouble he was forcibly informed by Bevin ‘To stop mucking about or he wouldn’tENDORSED be in the bloody government’. AttleeM rapidly put together a strong team. Bevin went to the Foreign Office, Dalton to the Exchequer. Herbert Morrison became Leader of the House of Commons, responsible for the management of government business and ALord President of the Council, an ancient title, which accompanied Morrison’s overview of Labour’s domestic programme. Stafford Cripps as S President of YETthe Board of Trade was the fifth member of Labour’s senior team. The one great surprise choice was that of the difficult and fiery Welshman, Aneurin Bevan as Minister of Health. At 47, Bevan was considerably younger than the others. The average age of the cabinet was over 60. In many respects it was oddly conservative despite the programme of reform. NOT 8 The Labour Party in power, Britain 1945

1111 2 Source H Source I 3 Attlee asked me what I thought of Geoffrey De Freitas The Attlee government even with such prominent left- 4 who was there to be vetted as a candidate for wingers as Bevan, Shinwell and Strachey, was 5 Parliamentary Private Secretary. Charming, I said, and anything but a doctrinaire socialist administration. 6 highly intelligent. ‘Yes,’ replied Attlee,’ and what is Attlee’s personal dedicationL to Haileybury public 7 more he was at Haileybury, my old school’. Churchill, school, Dalton’s to the rowing fraternity of King’s 8 though he sometimes said nice things about me, College, Cambridge,A alone belied the fact. In the 9 never included in his recommendations that we were summer of 1947, a new splinter –group of fifteen left- 1011 both Old Harrovians. I concluded that the old school wing MPs formedI the ‘Keep Left’ group in protest at 1 tie counted even more in Labour than in Conservative the government’s promotion of the mixed economy at 2 circles. home and, more especially, its hard line Cold War 3111 policies overseas. 4 An extract from the diary of Sir John Colville, which R recollecs a conversation at Chequers in August 1945. 5 Extract from Britain Since 1945: The People’s Peace Colville had been appointed to serve under Attlee to by KennethEDEXCEL O. Morgan, published 1990 6 help with the transition between governments E 7 8 9 However for all the personal conservatism of some of theT leading Labour 20111 ministers there was a real sense that something monumental had BY SKILLS BUILDER 1 happened in the election. John Freeman, a new young Labour MP, A How far does Source 2 expressed it eloquently in his speech replying to the King’s Speech opening H support Source I in 3 parliament on the 15 August ‘Today we go into action. Today may rightly be its views about 4 regarded as D-Day in the battle for the New Britain’. 5 M Attlee’s government? 6 7 8 Source J 9 E 30111 1 L 2 3 4 P 5 SKILLS BUILDER 6 7 ENDORSED What image does 8 M Low’s cartoon in 9 Source J present? 40111 1 A 2 3 S YET 4 5 6 7 2.3 A cartoon by Low from the Evening Standard of 27 July 1945 8222 NOT 9 Consensus and Conflict: British Political History 1945–90

Creating the new Britain: Part one – the welfare state Possibly the greatest achievement of the post-war labour government was the establishment of what became known as the welfare state, cradle-to- grave support for the entire population against poverty and sickness. This achievement was embodied in three Acts, two in 1946, the National Health Service Act and the National Insurance Act, andL one in 1948, the National Assistance Act. It is often believed that Labour created theA welfare state from scratch, and/or simply implemented the recommendations of Beveridge. Neither is strictly true. A national welfare systemI goes back to the reign of Elizabeth I and in its modern form to the major reforms carried through by the Liberal government before the First World War. Old age pensions, National Insurance against sicknessR and unemployment, existed for some people by 1914. These were gradually extendedEDEXCEL by 1939. Even before Beveridge produced his famousE report late in 1942, the Labour party was committed to an extensive overhaul and extension of welfare provision. T BY Source K A The Labour Part conference in 1942, having accepted a motion moved by James Griffiths, had called for a) one comprehensive scheme of social security; b) adequate cash paymentsM to provide security whatever the contingency; c) the provision of cash payments from national funds for all children through a scheme of family allowances; and d) the right to all forms of medical attention and treatment through a National Health Service. E Extract from Post-War Britain: A Political History by Alan Sked and Chris Cook, published in 1979 L

Beveridge’s report was important in giving a major boost to welfare reform. It was aP propaganda triumph which made it difficult for any post-war government not to extend welfare provision. Point (c) of the Labour programme of 1942 (seeENDORSED Source K) was actually carried out by the ConservativeM caretaker government of 1945.

National Insurance Act, 1946 AThe key element in Labour’s programme of reform was ‘universality’, which meant that benefits would apply to all, rich and poor. There would S be no meansYET test, a hated feature of the dole in the 1930s. On the other hand, benefits were paid for by insurance contributions, not given for free. The whole social security system of the 1946 Act was established on a sound economic basis and it was paid for by contributions from workers and employers not taxation. Only school children, pensioners, married women and the self-employed earning less that £104 a year were not NOT 10 The Labour Party in power, Britain 1945

1111 covered. A minimum number of contributions had to be made before 2 benefits could be drawn, and a proposed amendment from left-wing Labour 3 MPs that demanded the absolute right of the unemployed to benefits was 4 defeated. Old-age pensions were established at 26 shillings for those over 5 65 and 42 shillings for a married couple. 6 L The unemployed and those who had failed to make contributions were 7 dealt with in a later act, the National Assistance Act of 1948. Here personal 8 means tests were applied by regional offices of the National Assistance 9 A Board. This was kept separate from the Minister of Social Security 1011 established under the 1946 Act. The widespread support for welfare reform 1 I was shown by the fact that the Conservatives failed to oppose either the 2 second or third readings of the Bill. 3111 4 R 5 National Health Service Act, 1946 EDEXCEL 6 There was far more controversy over the other great Act ofE 1946. Here 7 the Conservatives attacked the details, if not the fundamental principles 8 behind the scheme announced by Aneurin Bevan, the new Minister of 9 Health. The key aims were laid down at the beginning ofT the Act. 20111 BY 1 Bevan early on took the decision to in effect nationalise all hospitals in 2 place of the chaotic mix, which then existed. There Awere locally run 3 hospitals many of which had in origin been attached to workhouses. 4 5 M 6 7 Source L 8 1. It shall be the duty of the Minister of Health to promote the establishment in 9 England and Wales of a comprehensive healthE service designed to secure 30111 improvement in the physical and mental health of the people and England and 1 Wales and the prevention, diagnosis and treatmentL of illness and for that purpose 2 to provide or secure the effective provision of services in accordance with the 3 following provisions of this act. 4 P 5 2. The services so provided shall be free of charge except where any provision of 6 this act expressly provides for the making and recovery of charges. 7 Extract from the NationalENDORSED Health Service Act of 1946 8 M 9 40111 A 1 SKILLS BUILDER 2 Read Source L. 3 S YET 4 What are the main principles of the new National Health Service as 5 outlined in this source and why would they create opposition? 6 7 8222 NOT 11 Consensus and Conflict: British Political History 1945–90

There were charity hospitals some of which were also teaching hospitals. He was initially opposed in cabinet by Herbert Morrison who believed strongly in local control. Bevan carried his point, receiving strong support from Hugh Dalton, the Chancellor of the Exchequer, who agreed to provide 80 per cent of the costs from taxation. Only 20 per cent of the cost of the health service was to come from national insuranceL contributions. 388 hospitals were to be run by 14 regional hospital boards centred on the medical faculties of a university. Bevan feltA that only the state could pay the quality consultants necessary to ensure a spread of talent throughout the entire country. The consultants wereI persuaded to go along with the scheme by the concession that they could continue their private practices while receiving generous salaries from the National Health Service. They were to become the demigods of theR new system. Bevan’s biggest fight was to be with the British MedicalEDEXCEL Association (BMA) which was the representative bodyE of general practitioners. There was real hostility from most GPs who feared being turned into mere state employees, a course which was favoured by the Socialist Medical Association. Bevan compromised,T letting down in their eyes his left-wing supporters. Doctors who agreed to join the BYNational Health Service were to be paid a small salary topped up by fees on the basis of the number of patients enrolled. This gaveA freedom to doctors and patients. Private practice could continue. As with the consultants, Bevan had bought off the doctors with generous terms, as he stated he had ‘stuffed their mouths with gold’. M State-run hospitals and state-funded and supervised general practitioners were supplemented by various local health services administered by local authorities suchE as maternity and child welfare clinics, health visitors, vaccination provision and ambulance services. By 5 July 1948,L 90 per cent of GPs had agreed to join and the whole scheme could be launched. Bevan had shown great skill and flexibility in piloting his Bill through Cabinet and parliament and negotiating with powerfulP bodies such as the BMA. The fire-breathing Welsh socialist had proved himself a pragmatic political operator, more so when the whole scheme turned into an enormous popular success. Thousands now received treatment, whichENDORSED they previously had felt that they could not affordM and the National Health Service, became not only the biggest employer in the country but an almost sacred national institution, such as the Royal Navy had been before. There was in fact an irony that as Aone new national icon was being created, the other was being destroyed. Between 1945 and 1948, 10 battleships, 20 cruisers, 37 aircraft carriers, S 60 destroyersYET and 80 corvettes had been scrapped. The nation’s priorities were changing. The new National Health Service was not without criticism then or since and a recent popular study of Modern Britain by the journalist Andrew Marr makes the following balanced judgement. NOT 12 The Labour Party in power, Britain 1945

1111 2 Source M 3 When the NHS opened for business on 5 July 1948, there was a flood of people 4 to surgeries, hospitals and chemists. Fifteen months later Bevan announced that 5 5.25 million pairs of free spectacles had been supplied, as well as 187 million free 6 prescriptions. By then 8.5 million people had already had free dental treatment. L 7 Almost immediately there were complaints about cost and extravagance, the 8 surge of demand for everything from dressings to wigs. There was much A 9 anecdotal evidence of waste and misuse. There certainly was waste. The new 1011 bureaucracy was cumbersome. And it is possible to overstate the change I– most 1 people had had access to some kind of affordable health care before the NHS, 2 though it was patchy and working class women had a particular difficulty in 3111 getting treatment. But the most important thing it did was take away Rfear. 4 Before it millions at the bottom of the pile had suffered untreated hernias, 5 cancers, toothache, ulcers and all kinds of illness, rather than face the EDEXCEL 6 humiliation and worry of being unable to afford treatment. There Eare many 7 moving accounts of the queues of unwell and impoverished people surging 8 forward for treatment in the early days of the NHS, arriving inT hospitals and 9 doctors’ waiting rooms for the first time not as beggars but as citizens with a 20111 sense of right. BY 1 2 Extract from A History of Modern Britain by AndrewA Marr, published in 2007 3 4 5 S IL S UIL E M 6 K L B D R 7 Analysing a secondary source 8 Using Source M, list the positive and negative comments on the 9 E National Health Service referred to here. 30111 1 In what ways does it tend to be moreL positive than negative over-all? 2 3 4 Housing and town planning P 5 If the introduction of the National Health Service was to prove one of 6 Labour’s most enduring and popular reforms, the most urgent in 1945 and 7 ENDORSED the issue that concerned most people in contemporary surveys was the 8 M issue of housing. By 1945 there was a crisis of major proportions. Not only 9 had building and slum clearance been largely halted by the war, German 40111 bombers had added to the problem by destroying the homes of many 1 A thousands of families. By 1945 there were 700,000 less houses than in 1939. 2 Nye Bevan as Minister of Health was responsible for housing but made it 3 YET less of a priority as heS was ‘only keeping half a Nye on it’ as one saying of 4 the period put it. 5 6 He was responsible for two Housing Acts extending the powers of local 7 authorities and with them he hoped to achieve an end to social segregation 8222 with people of all classes living in council houses. Possibly the most NOT 13 Consensus and Conflict: British Political History 1945–90

notable success of the period was the construction of 157,000 prefabs as temporary accommodation. Bevan in fact disliked these referring to them as ‘rabbit hutches’. Part of the reason he did not meet the government target of building 300,000 houses a year was his insistence on high standards, which increased the minimum floor area and insisted on both upstairs and downstairs lavatories, this at a timeL when many older properties did not even have any indoor lavatories. Despite a slow start in 1945–46, 750,000 new homes had been provided by September 1948, a not inconsiderable achievement. A Closely associated with the drive for moreI housing was the whole issue of planning which in the best war-time tradition was taken up enthusiastically by the government. If all land was not going to be nationalised then it would, at least, be subject to rigorousR government control. The Town and Country Planning Act was passed in 1947 and came into effect in 1948. Agricultural land was to be protected and urban developmentEDEXCEL carefully controlled, in contrast to the uncontrolledE and chaotic development of Victorian Britain. 14 new towns were to be constructed to help solve the housing shortages of the olderT cities. These included Stevenage, amongst many others, to solve the problems of Greater London, Peterlee in and Corby in Northamptonshire. NationalBY Parks were also to emerge from the same planningA process, a cause very dear to Dalton, the Chancellor of the Exchequer.

Creating the new MBritain: Part two – seizing the commanding heights of the economy The Labour Party felt that the other great initiative with which it could transform BritainE was seizing the commanding heights of the economy through what it termed socialisation, more commonly called nationalisation. The party was committed by clause 4 of its 1918 constitutionL to ‘the common ownership of the means of production, distribution and exchange’. This commitment had been publicly restated at a party conference in December 1944. The conference overwhelmingly carriedP a motion supporting public ownership that had been moved by a young left-wing activist, Ian Mikardo. After his triumph, a gloomy Herbert Morrison placed a handENDORSED on Mikardo’s shoulder and said – ‘You do realise thatM you have lost us the general election’. The King’s speech of August 1945 referred to large number of nationalisation proposals which would bring 20 per cent of the economy Aunder public ownership. Like the welfare reforms these seeming examples of radical politics were in reality less radical than they superficially S appeared. AllYET the proposed victims of nationalisation were already under some degree of state regulation and control as a result of the war effort. The approach adopted to running the newly nationalised industries was the public corporation. This device had already been adopted by Conservative governments to run the BBC in 1927 and BOAC in 1939. Nationalisation made little change to workers within the industries and usually left the NOT 14 The Labour Party in power, Britain 1945

1111 same managers in place. The complete non-revolution of this process 2 was well illustrated by the nationalisation of the Bank of England in 3 March 1946. There were no howls of protest from stricken capitalists 4 and the existing governor and deputy governor were immediately 5 reappointed and invited for a glass of sherry with the socialist Chancellor 6 of the Exchequer. This was a far cry from the Bolshevik revolution in L 7 Russia. Civil aviation was brought fully under state control in August 8 1946, coal and communications company Cable and Wireless in January 9 1947. Transport and electricity were taken over in 1948 and gas in 1949.A 1011 The only really controversial area was the iron and steel industry whose 1 nationalisation was bitterly resisted by the Conservatives and left untilI 2 1951. 3111 Given that there already existed a tradition of state control of such 4 R services as the BBC and temporary control of railways and mines in 5 wartime, the takeovers were hardly great political issues. In general the 6 EDEXCEL government was either taking over monopolistic utilities suchE as electricity 7 supply, against which the Conservatives had no arguments or “basket 8 cases” i.e. industrial enterprises that were no longer viable without state 9 T help. The railways were no longer profitable and the shareholders of these 20111 BY 1 industries were grateful to receive government stock in compensation for 2 their shares. Mine owners received £164,600,000, a veryA generous deal 3 for a run down antique industry in need of much modernisation. For the 4 miners however it was a symbolic victory over an ancient enemy. The 5 managers tended to be the same but miners receivedM improvements in 6 working conditions. 7 The most basic economic activity of the country, agriculture and the 8 producing of food was not neglected although the 1930s commitment to 9 the common ownership of land was forgotten.E An ex-Yorkshire miner, 30111 Tom Williams found himself Minister of Agriculture and actually ended 1 up endearing himself to farmers and landownersL although not to rural 2 romantics. The Agriculture Act of 1947 gave farmers guaranteed prices 3 and modernisation grants to encourage production and easy access to a 4 government–run scientific advisoryP service. Output increased to 146% 5 of 1939 levels and an age of ‘industrial’ farming blossomed. Williams 6 became known as ‘the Farmer’s Friend’ and on hisENDORSED retirement, the 7 Duke of Norfolk organised a farewellM thank-you dinner at Claridges club 8 in London. 9 40111 1 Creating the new Britain:A paying for it 2 As indicated above, the role of the state in peoples’ lives far from 3 decreasing with the arrivalS of peace continuedYET to grow. Part of this could 4 be paid for by shifting expenditure from defence to welfare and in this 5 sense the war made the implementation of the Labour programme easier. 6 Dalton proved a canny Chancellor of the Exchequer and one genuinely 7 radical in helping to build the new Britain. His biographer, Ben Pimlott 8222 summarised his budget strategies. NOT 15 Consensus and Conflict: British Political History 1945–90

Definitions Source N

The redistributive aim was disguised because Dalton reduced the total burden Direct taxes of taxation as compared to war-time levels, added nothing to income tax, and These are taxes on showed a preference for indirect over direct taxation. However, tax cuts were income which include the heavily in favour of the worst off. Dalton’s first twoL budgets took two and a half basic income tax and million people in lower income groups out of tax altogether (by raising personal ‘surtax’ a higher rate allowances and earned income relief) and substantiallyA increased surtax. charged on higher Dalton also revealed his socialism by what he deliberately neglected to do. incomes. Such taxes are He did not dismantle the tax structure thatI had been erected to meet wartime said to be ‘progressive’ needs. As Anthony Crosland put it later, ‘he maintained and even extended the because they hit the rich great advance to income equality that was made during the war’. For those harder. paying tax, the effect was ‘to steepenR the slope of graduation, and to make all tax on income more sharply progressive than before’. At its highest level, taxation Indirect taxes on income reached 19s 6d in the pound (97.5%). EDEXCEL Taxes on the buying and ExtractE from Hugh Dalton by Ben Pimlott, published in 1985 selling of goods such as excise duty on alcoholic T drinks are known as Nevertheless high taxes were not enough to sustain the ‘New Britain’. The indirect. BY end of the war produced a major financial and economic crisis as the USA suddenly and without warningA cancelled the Lend-Lease programme in August 1945. Without Lend-Lease Britain would not be able to pay for food imports to feed herself let alone cover the costs of massive defence SKILLS BUILDER commitments overseasM such as in occupied Germany, Greece and the Middle East. The only solution without inflicting even more sacrifices on Use Source N to the British public in terms of rationing and lower living standards was a answer the following massive loan from the USA. One of the world’s greatest economists and an question. adviser to the ETreasury, John Maynard Keynes, believed that he could What were Dalton’s extract an interest free loan or even a gift of $6 billion and was duly budget strategies? dispatchedL across the Atlantic. The United States did not see things quite as simply as the brilliant Keynes whose wit and arrogance produced distrust. It was aP case of brains versus power and power had the upper hand. Biography ENDORSED JohnM Maynard Keynes By 1945 Keynes was one of the most eminent economists in the world. He was born into a Cambridge academic family and became a celebrated academic figure A himself. He established an international reputation criticising the economic consequences of the Treaty of Versailles in 1919. His great work was ‘The General S Theory of Employment,YET Interest and Money’ in 1936. He appeared to offer a means of controlling the vagaries of the market by government policy thereby offering an alternative to the two opposed viewpoints of the period, namely free- market capitalism and state socialism. His ideas dominated British government policy from 1947 to the 1970s. NOT 16 The Labour Party in power, Britain 1945

1111 Eventually after four months of gruelling negotiations, which contributed 2 to Keynes’ death of a heart attack in 1946, the USA agreed to a 50 year 3 loan of $3.75 billion at 2% interest. Another condition imposed by the 4 US administration was that within 12 months of the loan beginning, the 5 pound should become freely convertible i.e. it could be freely traded 6 for dollars and other currencies on the world money markets. This was L 7 storing up trouble for 1947 but in the short term it was paying for the 8 ‘New Britain’. 9 A 1011 Crisis and misery 1 I 2 The rationing and deprivations of war-time continued well after the war 3111 ended. There was a serious shortage of dollars with which to pay for 4 imports after the US ended Lend-Lease. British exports had collapsedR and 5 it was a priority for the government to boost these, so that what goods EDEXCEL 6 were produced by the new peace-time Britain had to be directedE to exports 7 to earn currency to pay for necessary imports. One role of the heavy 8 taxation meted out by Dalton was to restrain spending power in Britain, 9 driving firms to export. The post-war economic situationT was made worse 20111 by serious shortfalls in coal production, for which Britain was dependantBY 1 for 90% of her energy. , the Minister of Fuel and Power 2 was absorbed in carrying through the nationalisationA programme and was 3 blithely optimistic, believing that the miners would deliver what was 4 necessary once they were freed from the ‘oppressive capitalist owners’, but 5 nationalisation could not make good years of under-investmentM and poor 6 management. By December 1946 there were serious fuel shortages 7 affecting the whole economy and in January/February 1947, the weather 8 intervened to produce a crisis hitherto unseen in 20th century Britain. 9 Siberian cold weather swept in from the east.E Many writers have described 30111 its impact. 1 L 2 3 Source O 4 P 5 Everyone who remembers 1947 has his own winter story. At Beaumont in Essex, 6 the local postmaster walked 16 miles through head-high drifts to the nearest 7 town to collect rations for his hungry village. On the morningENDORSED of 29th January, the SKILLS BUILDER 8 fireman of the 6.23 am train fromM Huddersfield to Bradford glanced out of his cab What was the 9 and was knocked unconscious by a large icicle hanging from a bridge. On a impression given of 40111 national scale, the story was one of unrelieved disaster. By the end of the first the winter of 1947 in 1 week in February two millionA men were out of work, and there was no electricity Source O? 2 at all for industry in the South Midlands and the North West. Several power 3 stations closed for lackS of coal; a hundred andYET twenty-five colliers were storm 4 bound on the Tyne. Parsnips were being dug out of the ground with pneumatic 5 drills. 6 Extract from The Age of Austerity 1945–51 by Susan Cooper, 7 edited by Michael Sissons and Philip French and published in 1963 8222 NOT 17 Consensus and Conflict: British Political History 1945–90

The Conservatives coined the phrase ‘Shiver with Shinwell’ as the government struggled to cope with the power shortages and cold weather. In March floods replaced the cold as the snow began to melt. Selby in the Vale of York was cut off and the water level in the low lying areas around the Rivers Ouse and Wharfe reached levels never known before or since. As the problems producedL by nature receded and a fine summer began new ones were caused by the need to accept the convertibility of the pound, as part of the deal over the US loan. No sooner was it possible to freely buy andA sell pounds in July than a sterling crisis ensued. Dollars poured from the country and by August convertibility was stopped. The governmentI began to plan for famine and the prospect of Britain not being able to import sufficient food. Rations were cut further than they had been in wartime and private consumption of petrol stopped. In November evenR potatoes were rationed something that had never even happened during the worst phases of the war. E EDEXCEL Political effects In these circumstances thereT was an inevitable knock-on effect in politics. Plots abounded to dump Attlee and replace him with either Cripps or Bevin. Dalton and Morrison wereBY in the forefront but Bevin remained steadfast and AAttlee showed himself a smart political operator. Cripps was first of all promoted in September to a new ministry in charge of economic planning, sidelining Morrison, who had hitherto had a general oversight. WhenM Dalton made the mistake in November of speaking to a journalist about the contents of his budget, just before announcing it to the Commons, he had to resign and Attlee replaced him with Cripps. The modest little prime minister had neatly defused the situation andE neutralised his critics. The economic situation nevertheless remained grim. L Unit summary What haveP you learned in this unit? This unit has covered a considerable amount of information. You have learned about why LabourENDORSED won the general election of 1945 and in what waysM the new government tried to transform Britain. In particular you should appreciate the major changes in welfare provision and the big increase in government management of the economy. Some of the Afinancial problems have been addressed and aspects of the very severe economic crisis that developed in 1947 YET S What skills have you used in this unit? You have encountered a large number of secondary sources relating to this period as well as some primary ones and asked to consider their strengths and weaknesses as sources of evidence for historians. You have begun to use sources in various different ways. NOT 18 The Labour Party in power, Britain 1945

1111 2 Exam-style question 3 This is in the style of a (b) question where the sources are used with own 4 knowledge 5 6 Study Sources J, M and N. L 7 How far do you agree with the view that the Labour government 8 transformed Britain in the years 1945–48? 9 A 1011 Explain your answer using the evidence of Sources 10,13 and 14 and your 1 own knowledge. I 2 3111 4 R 5 EDEXCEL 6 E 7 8 9 T 20111 BY 1 2 A 3 4 5 M 6 7 8 9 E 30111 1 L 2 3 4 P 5 6 7 ENDORSED 8 M 9 40111 1 A 2 3 S YET 4 5 6 7 8222 NOT 19