What Did the Labour Government do?

1945-51

Beveridge Report

• William Beveridge – Economist and Social Reformer.

• Famed for writing the Beveridge report

• The Beveridge Report was the Report of the Inter-Departmental Committee on Social Insurance and Allied Services chaired by William Beveridge.

Recommendations

• 1. Proposals for the future should not limited by "sectional interests" in learning from experience and that a "revolutionary moment in the world's history is a time for revolutions, not for patching".

• 2. Social insurance is only one part of a "comprehensive policy of social progress". The five giants on the road to reconstruction were Want, Disease, Ignorance, Squalor and Idleness.

• 3. Policies of social security "must be achieved by co-operation between the State and the individual", with the state securing the service and contributions. The state " should not stifle incentive, opportunity, responsibility; in establishing a national minimum, it should leave room and encouragement for voluntary action by each individual to provide more than that minimum for himself and his family".

• The British people hoped that “post-war would be better than pre-war”

5 Giants of the Beveridge Report

• WANT (poverty)

• DISEASE (bad health)

• SQUALOR (bad housing)

• IGNORANCE (poor education)

• IDLENESS (unemployment)

• Beveridge said

• “this is a time for revolution not patching”

• Universal welfare plan that should cover the whole population of the country.

Acts passed during the War

• Education Act 1944

• All children over the age of 11 should receive a separate secondary free of charge and that the school-leaving age would be raised to 15 as soon as possible.

• Family Allowances Act of 1945

• Coalition Measure introduced a child allowance of 5 shillings a week (25p) for the second and all subsequent children regardless of family income.

Labour Tackling the 5 Giants

WANT

• The main social problem to tackle

• 1946 National Insurance Act created the structure of the welfare state.

• Extended the 1911 National Insurance Act to cover all adults and also put into operation a comprehensive National Health Service.

• Compulsory contributory scheme for each worker and in return for the weekly contribution from workers, employers and government, an individual was entitled to sickness and unemployment benefit.

• Pensions for women at 60

• Pensions for men at 65

• Widows and Orphans’ pensions

• Maternity and Death Grants

Quote

• James Griffiths, Minister of National Insurance

• “The best and cheapest insurance policy offered to the British people, of any people anywhere”

Problems with Pensions

• The Pensions were still not enough to live on.

• Value of pensions reduced by inflation

• Pensions levels remained below basic subsistence levels.

National Assistance Board

• Helped people not in work or who had not paid enough contributions to qualify for full benefit.

• People in need could apply for further assistance from the national assistance board.

• Applicants were means tested but not the same as the draconic means testing of the 1930s

• Money provided by Government from central taxation.

• Government also required local authorities to provide homes and other welfare services for the Elderly and handicapped.

Purpose

• To provide a whole new social security structure and really did provide a safety net through which no person should fall into serious poverty.

Family Allowance Act

• Attack household poverty.

• Started by the wartime government

• Small amount of money paid to all mothers of two or more children.

• Money paid to the mothers and not the fathers

• Not means tested

Industrial Injuries Act 1946

• Compensation paid by the government , not individual employers and all workers were covered.

Summary of Want

• Almost 50 years earlier, Seebohm Rowntree had identified old age, sickness, injury at work and unemployment as the main causes of poverty.

• Labour had directly attacked these problems and provided help and assurance to many and in doing so removed the fear of falling into serious long-term poverty.

DISEASE

• Most people consider the greatest achievement of the post-war Labour Government to be the creation of a National Health Service.

3 Aims

• UNIVERSAL ACCESS– NHS was for everybody– Regardless of Class and income

• Comprehensive – Meeting all demands– Treating all medical problems

• Free at the point of use– No patient would be asked to pay for any

treatment

Funded

• The service was and is paid for by the taxation and National Insurance payments made by every worker

ORDINARY WORKER PAYS TAX FUNDS NHS

Before NHS

• Healthcare had to be paid for

• About ½ the male workforce was entitled to assistance through various insurance schemes

• Wives and families did not qualify

• Many families had no insurance and had to rely on support from friends, neighbours or local charities.

Services Offered

• Offered free health care at the point of need

• Everybody was entitled to– GPs– Specialists– Dentists– Spectacles– False Teeth– Maternity and Child Welfare Services

Opposition

• At first opposition came from Doctors

• “Being treated like civil servants”

• Would end the Gravy train of private healthcare

Aneurin Bevan

• Minister for Health

• Responsible for establishing the NHS

• Defused the situation with a new payment to doctors

Results of the NHS

• Even though there was opposition to the NHS, ordinary people celebrated the arrival of the NHS

• The new NHS was inundated with a backlog of untreated problems.

• Doctors, dentists and opticians were flooded with patients

• Prescriptions rose from 5 million a month before the NHS to 13.5 million in September 1948

• In the first year 5,000,000 spectacles were dispensed

• 8,000,000 dental patients were treated

Spiralling Cost

• Victim of its own success

• Became an ENORMOUS EXPENSE

• National Insurance only contributed 9% of NHS funding in 1949.

• The rest coming from general taxation.

Charges

• By 1950 the NHS was costing £358 million a year

• The Labour Government were forced to BACKTRACK on the principle of a free Service by introducing charges for spectacles and dental treatment

• The Government was also constrained (limited) by the economy still recovering from the war.

Conclusion of the NHS

• Despite criticism, compromises and constraints the NHS was arguably

“The greatest single achievement in the story of the welfare state”

Beveridge Report

• Beveridge made clear his desire for an education system available to all, especially the poor, which would provide opportunities and develop talent.

Problems with Education

• Before 1939 Education services varied across the country.

• The quality of secondary education was variable• Many children received no education past

primary stage and poorer parents could not afford the fees that some secondary schools charged.

• Scholarship did exist but pressure to leave school and bring in wages was very high.

Education Act 1944

• Also know as the Butler Act

• Main idea was equality of opportunity

• Allowing working class children with ability to progress as far as they could without being restricted by the demands to pay expensive fees.

• However in reality the Act was rather different from its original aims.

• Butler believed that the future of Britain’s strength and Wealth lay in

Science Technical

Butlers idea

• Three level education system

• Technical• Grammar• Secondary modern

• In Scotland the last two were normally called senior and Junior secondary.

• Originally each type of school would have equal status.

• In reality though it was not the case.

Which School

• All children sat an exam at 11

• Called the 11+ exam or Qualy in Scotland

• Decided the type of school a child went to.

• Those who passed went to a senior secondary school and were expected to leave school after 15, go on to university or get jobs in management and the professions.

Fail?

• Junior secondary

• Leave school at 15

• Enter an unskilled job

• By failing the 11+, thousands of children were trapped in a world of low expectations and inferior education.

Success or Failure

• There was a small increase in the proportion of working class boys at grammar school but the real benefits lay with the middle classes.

• Grammar schools and senior secondary's were given far more government spending than junior secondary moderns.

• 11+ exam was socially divisive and highly contentious selection procedure.

• Secondary modern became the ‘inferior’ partner offering little in the way of opportunities to children.

• Many children were classified as non-academic as grammar schools could only take about 20% of children.

Lack of Understanding

• Never really understood the need for a tight control of educational policy.

• Some of the leaders such as Attlee, Dalton, Cripps all went to Public School.

• Little understanding of state system• Others like Bevin, Morrison and Shinwell

had little formal education.• Tomlinson who became Minister of

Education in 1947 left school at 12.

• Compared to the equality of opportunity and provision being enacted in the fields of social security and health, the Labour Government did little for the educational welfare of the working class.

Serious Problem

• The chronic housing shortage at the end of the war was the most pressing problem facing the government.

• Already a serious shortage before the War

• Made worse by the destruction of 700,000 houses by Hitler’s bombers.

• In 1945, 1/3 of all British houses were in need of repair and renovation.

• As peace broke out a huge rebuilding programme was needed.

• Labour Manifesto“Labour’s pledge is firm and direct – it will

proceed with a housing programme with the maximum practical speed until every family in this island has a good standard of accommodation”

Aims and Reality

• The aim was too build 200,000 houses each year.

• Economic conditions did not help

• Raw materials were in short supply and expensive

• Lack of building workers.

• Timber had to be imported from Sweden and America.

• The responsibility for Britain’s housing problems fell to Bevan at the Health Ministry

• Bevan’s policy was to help those most in need i.e. working class.

• Most of the scarce building materials were allocated to the local authorities to build council houses for rent.

• Between 1945-51 4 council houses were built to every private house.

• As a short term solution the government built prefabricated houses known as “prefabs”

• 1946 saw the completion of 55,600 new homes; this rose to 139,600 in 1947, and 227,600 in 1948. While this was not an insignificant achievement, Bevan's rate of house building was seen as less of an achievement than that of his Conservative (indirect) successor, Harold Macmillan, who was able to complete some 300,000 a year as Minister for Housing in the 1950s. Macmillan was able to concentrate full-time on Housing

• However critics said that the cheaper housing built by Macmillan was exactly the poor standard of housing that Bevan was aiming to replace

• However despite all this, the shortage was still chronic and many families were forced to take residence in disused army camps.

• After the War there was– Increase in marriages– Rapid increase in birth-rate– Reluctance of families to continue living as an

extended family.

• All this meant that houses were swallowed up as fast as they were built.

• In spite of labours undoubted achievement, given the difficult economic situation, there was still a serious housing shortage in 1951 and long waiting lists for council housing.

New Towns Act 1946

• Gave the government the power to decide where new towns should be build.

• The aim was to create town that were healthy and pleasant to live in unlike the random uncontrolled growth of Britain’s 19th century industrial towns.

• 14 New Towns were established before the end of the labour government in 1951 including Glenrothes and East Kilbride

Success or Failure?

• Historians

• 1951 Voters

Unemployment

• Need to avoid a return to the problems of the late 1920-30s.

• Mass Unemployment etc

• In 1944 a White Paper (government proposals for discussion) seemed to accept the need for full employment.

Nationalisation

• One answer to the problem of unemployment was nationalisation

• Meant that, in theory, the government would take over major industries and run them for the benefit of the country rather than private owners

• Labour believed that they could control and manage the economy more effectively and maintain full employment.

• Beveridge believed that unemployment could not be brought down below 3%

• By 1946, the unemployment figure was 2.5%

• Dalton, the 1st post war chancellor of the exchequer, claimed that full employment was

“The greatest revolution brought about by the Labour Government”

Why did this occur?

• Marshall Aid?

• Governments economic policies?

• Post-war boom?

• Mixture of all of these?

Unemployment levels 1931-51

• (thousands)

1931 2,630 1938 1,791 1945 137

1932 2,745 1939 1,514 1946 374

1933 2,521 1940 963 1947 480

1934 2,159 1941 350 1948 310

1935 2,036 1942 123 1949 308

1936 1,755 1943 82 1950 314

1937 1,484 1944 75 1951 253

How do you achieve Full employment?

• Keeping interest down

• This encouraged private investment and local authority spending

• The Government controlling inflation (price controls & rationing)

Reality

• De-mobilisation was carried out without upsetting economic recovery

• There was no return to high levels of unemployment in the pre-war depressed areas of northern and western Britain.

• North-east coastal area of England had unemployment rates of 38% in 1938

• 1951 the figure stood at just 1.5%

•Britain faced massive problems between 1945 and 1951:

•bread and potato rationing•severe shortage of raw materials•fuel shortages during the winter of 1947•a 30% devaluation of the pound•inflation•balance of payments problems•losses of overseas assets and markets during WW2•loss of one-quarter of its national wealth during WW2

Devaluation of the Pound

• Helped the exports industry

• E.g. A British car was now 30% cheaper

• Therefore world demand for British exports grew.

Positive Evaluation•Economic historians tend to conclude that it was difficult to see how Labour’s performance could have been improved upon.

•Britain’s growth rates were better than America’s. The wartime slogan ‘Britain can take it’ had changed to ‘Britain can make it’. (Pearce)

•‘The single most important domestic achievement of the Labour government was the maintenance of full employment after the war.’ (Brooke)

•This was made more impressive by a climate of crisis and diminished resources. Between 1945 and 1951, unemployment averaged 310,000 a year, compared to 1,716,000 for the period 1935-9.

•Labour’s achievement of full employment by 1950 led to a belief that further, more radical social reforms were not needed and that ‘a growing economy would take care of remaining social problems.’ (Thane)

•The average real wage in 1949 was 20% higher than in 1938. People were better off.

Positive Evaluation

Criticism•There is very little to criticise about the unemployment record during the period 1945-51•Only once, during the fuel crisis of 1947 (sparked by the exceptionally harsh and prolonged winter), did unemployment briefly approach the one million mark•The raising of the school leaving age from 14 to 15 in 1947 helped keep the unemployment figures down.•Some historians argue that Labour can take little credit for full employment. Most of the factors affecting employment were outwith government control e.g.

•world demand was growing•Britain could sell all its exports•all countries needed to re-stock due to the damage and interruptions of the war •therefore the government did not have to create jobs itself

IDLENESS

Overall Judgement

• The Labour Government focused on their attempts to build a fair society in Britain where help was available to all.

• “New Jerusalem”

• Pro’s• 5 Giants were under severe

attack• State now provided a safety

net• Cradle to the Grave• Rowntree’s investigation of

York in 1950 found that primary poverty had gone down to 2% from 36% in 1936.

• Poverty had been reduced but not eliminated

• Still much to do• Adequate schools, hospitals

and houses were in short supply.

• Cons• Labour only built on the work

done by the Liberal 1904-14 and Coalition Government of 1940-45

• Only completed the Welfare State originated by others

• Lack of experience in government and restricted by serious economic problems

• Some critics argued that the government was either doing too much for the people. Nanny State.

• Apart from a disappointing record on housing, Labour carried out its manifesto promises.

• By 1951, Britain had a comprehensive system of social security, unified health and education services and full employment.

• Many doubt whether the conservatives would have completed the social welfare system had they won the election.

• Attlee wanted his reforms to last, and although criticised for not being radical enough, and he was successful in this as the conservatives largely accepted the welfare state.

OVERALL!