Edward Heath 1970-1974

'The New Right'
1. Reduce rise in prices, increase productivity, reduce unemployment
  1. State intervention to be abandoned, 'break away' from consensus
Trade Unions
1. Industrial Relations Act 1971
  1. Restricted right of workers to strike
  2. National Industrial Relations Court (NIRC) judged validity of strike
  3. Unions required to register themselves to Govt to maintain legal rights
2. Hostility
  1. TUC refused to join 1971 Act, as did all unions. Impossible to enforce Act
    1. Heath Govt. appeared weak
  2. NUM. 1972, for wage increase and highlight threat on livelihood, strikes
A Bad Start
1. John Davies, Department Of Trade and Industry
  1. Advised Govt comapanies not doing well, should not be funded
2. Anthony Barber as Chancellor Of Exchequer
  1. Income tax cuts, reductions in Govt spending, scrapped Prices and Incomes Board
    1. Brought tax concession to rich, rise in council house rent
3. Withdrawal of free milk. Margaret 'the milk snatcher'
4. Inflation at 15% in 1971, Industrial output declining
  1. 1972, returned to price and income control
    1. 1971, DTI nationalise Rolls Royce. U-Turn
      1. Upper Clyde Shipbuilders granted £34m to continue
Failures
1. 1973, three-day week. NUM gained 21% wage increase
  1. Almost 3x what they originally offered
    1. 1974 further strike, 'Who governs Britain?'
  2. Major Heath defeat
2. Rapid inflation made maintaining prices impossible
  1. Productivity declined due to miners strikes and demands
    1. Unemployment had only risen under Heath
      1. Resorting back to austerity measures with 3 day week
3. Labour won 1974 election by four seats
Other Aspects
1. Local Government Act 1972-73
  1. Peter Walker, Environmental Minister
    1. Reshape local government structure
      1. Destroyed landmarks, Rutland
2. EEC 1973
  1. De Gaulle retires 1969
    1. Reapply 1972, signed Jan 1 1973
      1. Heath said to have told colleagues to accept EEC's request at any cost
  2. 'The Six' unwilling to listen to newcomer
  3. European tariffs non-profitable for imports or exports
  4. British workers could work in any EEC country
3. Oil Price Crisis 1973
  1. OPEC, Arabs use oil as weapon in conflict with Israel
    1. Arab-Israeli War, Oct 1973. West supported Israel
      1. Arabs then reduced oil supplies to West
        Severe Inflation. Severe Recession 1973-83
4. Balance of Payments deficit reaches £1b
  1. Unemployment had receded to 628,000 by 1974
    1. Sterling value dropped from $2 to $1.57

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Edward Heath 1970-1974

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