Abstract
Labour returned to office in March 1974 and policy-making within the party received less attention than it had during the preceding years. The paucity of consideration given to internal policy matters was not surprising because Labour had adopted a new programme and now had the opportunity to implement it. Five years later when Labour lost power in May 1979, supporters of its industrial strategy were bitterly disappointed: they claimed that the government had not carried out the plans contained in Labour’s Programme 1973. In this chapter I examine the attempt to realize the Alternative Economic Strategy — as the left’s strategy was termed by 1975 — while Labour was in government. I outline the development of the legislative proposals produced by Tony Benn and others at the Department of Industry after March 1974. I look at the impact of these industrial policies in practice and I consider to what extent the party’s strategy was shaped by the difficult economic circumstances that the government encountered. I also examine the developing relationships between the Labour government and the wider party.
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References
See T. Evans, ‘A Strategy for Government Industrial Policy’, Public Enterprise, 8 (1978), pp. 17–20;
Tom Forester, ‘Neutralising the Industrial Strategy’, in Ken Coates (ed.), What Went Wrong (Nottingham, Spokesman, 1979), pp. 74–94;
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Cmnd 5710, The Regeneration of British Industry (London, HMSO, 1974). See The Economist, 17 June 1974. The Labour MP Brian Sedgemore notes the accuracy and detail of The Economist’s reporting about industrial policy in this period: evidence, he claims, that leaks were coming from inside the Department of Industry. See The Secret Constitution (London, Hodder and Stoughton, 1980), p. 137.
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See Tribune, 15 November 1974; and Ken Coates, ‘Labour’s Turning Point’, Workers’ Control Bulletin, 25 (July 1975), pp. 2–3.
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The Economist, 15 February 1975.
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HMSO, Industry Act 1975 (London, 1975), clause 21, pp. 2006–7.
Department of Industry, The Contents of a Planning Agreement (London, HMSO, 1975), p. 3. Planning agreements would be ‘wholly voluntary, based on consent’; p. 2.
A similar conception of planning agreements was contained in Peter Shore’s Programme for Recovery (1982).
Denis Healey and Eric Varley, ‘Industrial Strategy’, RE: 1532/February 1978.
Cmnd. 6315, An Approach to Industrial Strategy (London, HMSO, 1975), p. 3. See also The Economist, 1 November 1975;
and T. Benn, Against the Tide (London, Hutchinson, 1989), pp. 455–7;
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Quoted by S. Wilks, ‘Planning Agreements: the Making of a Paper Tiger’, p. 405.
See ‘The National Enterprise Board’, RE: 668/June 1976; M. Parr, ‘The National Enterprise Board’, National Westminster Bank Review (February 1979), pp. 51–62; and N. Vann, ‘Negotiating Planning Agreements’, Studies for Trade Unionists, 3 (March 1977), pp. 3–11.
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M. Sawyer, ‘Industrial Policy’, p. 160.
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Quoted by D. Kramer, State Capital and Private Enterprise, p. 8.
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Department of Industry, National Enterprise Board Guidelines (London, HMSO, 1977), p. 2.
D. Kramer, State Capital and Private Enterprise, p. 14.
Coventry Trades Council et al, State Intervention in Industry, pp. 99–112; and S. Wilks, ‘Planning Agreements: The Making of a Paper Tiger’, p. 406–416. See ‘A Note on Planning Agreements: Progress and Policy’, RE: 933/January 1977.
TUC, The Trade Union Role in Industrial Policy (1977), p. 94.
Cmnd. 6706, Report of the Committee of Inquiry on Industrial Democracy (London, HMSO, 1977).
See also John Elliott, Conflict or Cooperation? (London, Kogan Page, 1978), pp. 205–64.
Some Leftwingers were also unhappy. See Ken Coates and Tony Topham, ‘Bullock What’s Wrong?’, Workers’ Control Bulletin, 35 (1977), pp. 2–3;
Ken Coates, ‘Holding the Line Against Bullock’, Workers’ Control, 1 (1978), pp. 3–4;
and Ken Coates and Tony Topham, The Shop Steward’s Guide to the Bullock Report (Nottingham, Spokesman, 1977).
See T. Benn, Against the Tide, p. 158; and Joel Barnett, Inside the Treasury (London, Andrew Deutsch, 1982), pp. 35–7.
M. Sawyer, ‘Prices Policies’, in M. Artis and D. Cobham (eds), Labour’s Economic Policies 1974–79, pp. 176–89.
The Economist, 16 November 1974 and 21 December 1974. Some Leftwingers were more positive about the impact of price controls on inflation; interview, John Hughes, February 1994.
See Shirley Williams, ‘Review of the Price Code’ (paper, 12 November 1974); and Shirley Williams, ‘Investment and Other Cut-Backs in Industry’ (paper, November 1974).
H. Wilson, Final Term, pp. 29–36, 135–43.
Phillip Whitehead, The Writing on the Wall (London, Michael Joseph, 1985), p. 129.
Barbara Castle, The Castle Diaries 1974–76 (London, Weidenfield and Nicolson, 1980), pp. 145–46. See also Tony Benn, Against the Tide, p. 159.
Quoted by Coventry Trades Council et al, State Intervention in Industry, p. 37. The Times, 23 May 1974; and B. Castle, The Castle Diaries 1974–76, p. 103.
Michael Hatfield, The House the Left Built (London, Victor Gollancz, 1978), pp. 235–8;
Eric Heffer, Labour’s Future (London, Verso, 1986), p. 12;
Austen Morgan, Harold Wilson (London, Pluto Press, 1992), pp. 438–9;
and Robert Jenkins, Tony Benn (London, Writers and Readers, 1980), pp. 207–9.
H. Wilson, Final Term, p. 33.
See Eric Heffer, Never a Yes Man (London, Verso, 1989), p. 154;
T. Benn, Against the Tide, pp. 187–9; and Edmund Dell, A Hard Pounding (Oxford, Oxford University Press, 1991), pp. 94–5.
The Economist, 20 July 1974.
H. Wilson, Final Term, p. 33.
P. Whitehead, The Writing on the Wall, p. 130.
B. Donoughue, Prime Minister (London, Jonathan Cape, 1987), p. 52.
R. Day, … But with Respect (London, Weidenfield and Nicolson, 1993), p. 112.
Michael Meacher, ‘Interview’, Politics and Power, 2 (1980), pp. 8–14, p. 10.
P. Whitehead, The Writing on the Wall, p. 131.
The Economist, 15 June 1974.
T. Benn, Against the Tide, p. 193.
T. Benn, Against the Tide, p. 209.
B. Castle, The Castle Diaries 1974–76, p. 167. See also I. Mikardo, Back-bencher (London, Weidenfield and Nicolson, 1988), p. 197.
The Economist, 17 August 1974.
The Guardian, 3 August 1974. The result was ‘a major victory for rightwing members of the cabinet’.
Interview, T. Benn, July 1989.
R.Jenkins, Tony Benn, p. 212.
Quoted by Jad Adams, Tony Benn (London, Macmillan, 1992), p. 355.
Quoted by Coventry Trades Council et al, State Intervention in Industry, p. 43.
Ben Pimlott, Harold Wilson (London, Harper Collins, 1992), p. 665.
The Guardian, 16 August 1974.
P. Whitehead, The Writing on the Wall, p. 131.
B. Donoughue, Prime Minister, p. 53.
The Guardian, 16 August 1974.
P. Whitehead, The Writing on the Wall, p. 140.
The Economist, 22 June 1974.
The Times, 1 August 1974.
The Economist, 16 November 1974.
Labour Weekly, 25 October 1974; and Bank of England Quarterly Bulletin, 14 (1974), pp. 435–6.
Michael Foot, Loners and Loyalists (London, Collins, 1986), p. 49. See also B. Castle, The Castle Diaries 1974–76, pp. 11 and 531.
Peter Shore, Leading the Left (London, Weidenfield and Nicolson, 1993), p. 123.
Interview, September 1993.
See John Hughes, ‘Those Company Profits’, Workers’ Control Bulletin, 22 (December 1974), pp. 7–9. The Economist reported Jack Jones as holding a similar view, 6 September 1975.
Stuart Holland, The Socialist Challenge (London, Quartet, 1975), p. 57.
‘Current Economic Developments, July 1975’, RE: 232/July 1975, p. 28.
‘The Alleged Profits Crisis and Labour Policies’, Tribune group papers; and Stuart Holland, ‘An Alternative Economic Strategy’, in M. Barratt Brown et al (eds), Full Employment Priority (Nottingham, Spokesman, 1978), pp. 133–6.
Tribune, 18 October 1974. See also Brian Sedgemore, Tribune, 8 November 1974.
M. Meacher, ‘Interview’, p. 9. A point also made by Labour’s research department, ‘Economic Report’, RE: 336/November 1975.
IPSC minutes, 21 June 1975. Others on the committee were pessimistic.
Stuart Holland and Paul Ormerod, ‘Corporation Tax and Economic Policy Issues’, RD: 434/June 1980, written in 1978; and J. Hughes, ‘A Programme for Industrial Development’ (unpublished paper, 1975), p. 1.
See the discussion in W. Martin (ed.), The Economics of the Profits Crisis (London, HMSO, 1981).
T. Benn, Parliament, People and Power, p. 29. Donoughue makes a similar point, Prime Minister, p. 60.
Lewis Minkin, The Labour Party Conference (Manchester, Manchester University Press, 1980), pp. 349 and 359.
See T. Benn, Against the Tide, p. 445; B. Castle, The Castle Diaries 1974–76, pp. 511–2; and Jack Jones, Union Man (London, Collins, 1986), pp. 300–1.
IPSC minutes, 25 March 1975, 8 April 1975 and 22 April 1975;
Tony Benn, Frances Morrell and Francis Cripps, ‘A Ten Year Industrial Strategy for Britain’, RE: 126 April 1975, p. 16. It was reproduced as T. Benn, F. Morrell and F. Cripps, A Ten Year Industrial Strategy for Britain (IWC pamphlet 49, 1975).
IPSC minutes, 21 June 1975. See also ‘Economic and Industrial Planning’; RE: 144/May 1975 and RE: 144a/May 1975; and Labour party, Labour and Industry (1975).
B. Castle, The Castle Diaries 1974–76, p. 493.
IPSC minutes, 27 June 1975.
RE: 599/April 1976; and The Times, 13 April 1976.
NEC minutes, 12 May 1976.
NEC minutes, 19 May 1976.
Labour party, Labour’s Programme 1976 (1976), p. 6.
The Times, 28 May 1976. See also Eric Varley, ‘Comments on Labour’s Programme 1976’, RE: 647/May 1976.
P. Shore, Leading the Left, p. 123.
Report of the NEC Delegation on Industrial Policy, minutes, 4 February 1976, RE: 511/March 1976. Other meetings are detailed in RE: 728/July 1976 and RE: 1946/December 1978.
See ‘Economic and Industrial Policy’, RE: 521/March 1976; ‘Alternative Economic Strategies’, RE: 900/December 1976; ‘A Summary of Labour’s Industrial Policy’, RE: 1341/October 1977; ‘Planning Agreements and Industrial Policy Under Current Legislation’, RE: 1427/December 1977; and ‘Proposals for the 1978 Budget’, RE: 1529.
‘An Agenda for Agreement’, RE: 966/February 1977, p. 4. See also D. Healey and E. Varley, ‘Industrial Strategy’, RE: 1532/February 1978, p. 7; R. Liddle, ‘The Government’s Policy and Labour Party Programme’, RE: 1383/November 1977; and Department of Industry, ‘The Strengths and Weaknesses of the Sectoral Approach’, RE: 1533/February 1978.
See G. Bish, ‘Working Relations Between Government and Party’, in K. Coates (ed.), What Went Wrong, pp. 163–9.
HPC minutes, 6 February 1978 and 13 February 1978; IPSC minutes, 29 June 1978; and NEC minutes, 22 February 1978.
‘The Crisis and the Only Way in which the Labour Government Can Solve It!’, Tribune, 1 January 1975. Members of the PLP frequently criticised the government’s policy trajectory — they were equally aware of the limitations as to what they could do to secure a more favourable economic policy. See PLP minutes, 21 November 1974, 16 April 1975, 8 July 1975 and 11 November 1975; and Tribune group minutes, 14 July 1975.
M. Foot, Loners and Loyalists, p. 114.
J. Jones, Union Man, p. 309.
The Times, 13 March 1976.
The Trade Union Role in Industrial Policy, pp. 83–4; and TUC, Industrial Strategy: Action at Company and Plant Levels (1979), p. 1. See also LC minutes, 31 January 1977.
TUC, Economic Review (1977), p. 36.
For example, Len Murray called for import controls, planning agreements and a strong NEB at the 1975 Congress. Jack Jones supported industrial democracy, import controls, planning agreements, and price controls at various times. See Tribune, 5 April 1974, 4 July 1975, 21 November 1975 and 5 March 1976. David Basnett endorsed capital and import controls, price controls, and increased investment. See TUC, Annual Report (1976), pp. 528–9,
and TUC, Annual Report (1978), p. 443. Hugh Scanlon moved to the right after 1974 and supported Labour’s pay policy.
However he still called for an industrial strategy, TUC, Annual Report (1978), pp. 523–5. See also The Social Contract 1976–77, pp. 23–39; and The Trade Union Contribution to Industrial Policy, pp. 17–33.
Lewis Minkin, The Contentious Alliance Trade Unions and the Labour Party (Edinburgh, Edinburgh University Press, 1991), p. 170.
J.Jones, Union Man, p. 304.
Interview, TUC Official, August 1993. See also Jack Jones, Union Man, pp. 261 and 282; and quoted in Coventry Trades Council et al, State Intervention in Industry, p. 121.
Stephen Bornstein and Peter Gourevitch, ‘Unions in a Declining Economy: The Case of the British TUC’, in P. Gourevitch et al, Unions and Economic Crisis (London, George Allen and Unwin, 1984), pp. 13–88, p. 51.
J. Jones, Union Man, pp. 296–8.
Interview, July 1989.
Those that did included: ASTMS, The Crisis in British Economic Planning (1975);
NUPE, Inflation Attack or Retreat? (1975);
and NUPE, Time to Change Course (1976).
Jack Jones, Union Man, p. 308.
TUC-Labour Party Liaison Committee, The Next Three Years and The Problem of Priorities (1976), p. 8.
TUC-Labour Party Liaison Committee, The Next Three Years and into the Eighties (1977);
and, TUC-Labour Party Liaison Committee, Into the Eighties: An Agreement (1978).
NEC minutes, 23 June 1976; and 28 July 1976.
Stuart Holland, ‘Planning Disagreements’, in Stuart Holland (ed.), Beyond Capitalist Planning (Oxford, Blackwell, 1978), pp. 137–64, p. 145.
B. Castle, Fighting All the Way (London, Macmillan, 1993), p. 478.
‘Economic and Industrial Policy’, RE: 521/March 1976, p. 5.
G. Hodgson, Labour at the Crossroads (Oxford, Martin Robertson, 1981), p. 129; and D. Hoyle, ‘Labour Party and Nationalisation’, Labour Monthly (March 1976), pp. 111–5, p. 114.
‘The NEB and the Industrial Strategy’, RE: 962/February 1977, p. 3.
IPSC minutes, 22 June 1976 and 29 June 1978.
Quoted by Coventry Trades Council et al, State Intervention in Industry, p. 80.
T. Benn, Parliament, People and Power (London, Verso, 1982), p. 30.
M. Meacher, ‘Interview’, p. 7.
Quoted by Geoff Hodgson, Labour at the Crossroads, p. 134. Holland had called for grass roots support earlier; ‘Shop Floor Action To Force Through Labour’s Programme’, Workers’ Control Bulletin (December 1973), p. 2.
Interview, September 1993.
Quoted by Coventry Trades Council et al, State Intervention in Industry, p. 121.
In this sense the government’s abandonment of the industrial strategy did not represent, for the most part, a betrayal as many leftwingers alleged subsequently. Ministers had made no secret of their hostility to the AES before 1974. In office they attempted simply to implement the measures they had defended in opposition. Wilson’s rhetoric, however, was characteristically ambiguous in this regard.
B. Sedgemore, The Secret Constitution, p. 136.
B. Castle, The Castle Diaries 1974–76, p. 675.
‘Industrial Strategy: Government and Party’, p. 12.
T. Benn, Parliament, People and Power, p. 28; and S. Holland, ‘New Public Enterprise and Economic Planning’, in K. Coates, How to Win? (Nottingham, Spokesman, 1981), pp. 111–46, p. 118.
RD: 6/June 1979, p. 2.
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© 1996 Mark Wickham-Jones
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Wickham-Jones, M. (1996). Labour in Office, 1974–79. In: Economic Strategy and the Labour Party. Palgrave Macmillan, London. https://doi.org/10.1057/9780230373679_7
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