Abstract
In November 1978, Arthur Cockfield addressed the Institute for Fiscal Studies (IFS).1 As will appear, Cockfield and the IFS had played, and would continue to play, important parts in debates over taxation and spending. Cockfield claimed to detect a turning point on spending and associated revenue policies, in Britain and elsewhere: ‘public resentment will ultimately compel a reduction in the role of the state … it may well be that the collectivist tide has already reached its high water mark’.2 Much of the literature reflects this apparent Conservative intellectual and rhetorical self-confidence. Some writers have discerned Conservative enthusiasm for radical Republican policies.3 Thus, Gamble suggests that, after 1974, the Conservatives embraced ‘the revival of a liberal economy’.4 In his view, they sought large reductions in welfare spending to secure substantial cuts in taxation.5
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Notes
Francis Arthur Cockfield, Too Much of a Good Thing?: Looking back over 45 years involvement in tax administration, Lord Cockfield questions whether we might not have asked our tax system to do too much … (London: Institute for Fiscal Studies, 1978).
Middlemas, Power, Competition and the State, vol. 3, The End of the Postwar Era: Britain since 1974 (Basingstoke, 1991).
Andrew Gamble, Britain in Decline: Economic Policy, Political Strategy and the British state (3rd edn, London, 1991) p. 143.
Source for all the figures in this paragraph: James Browne and Barra Roantree,A Survey of the UK Tax System (IFS, Oct. 2012) http://www.ifs.org.uk/bns/bn09.pdf, Table 11, Summary of main reforms, 1979–2012,
and see generally, T. Clark and A. Dilnot, Long-Term Trends in British Taxation and Spending, IFS Briefing Note 25, 2002 http://www.ifs.org.uk/bns/bn25.pdf, both accessed 2.5.13.
Viscount Hailsham, The Conservative Case (Middlesex, 1959) p. 112.
Martin Daunton, Just Taxes: The Politics of Taxation in Britain, 1914–1979 (Cambridge, 2002) pp. 277–278.
Bow Group Paper ‘The Theoretical Basis of a Tax System’, June 1957, Cambridge, Churchill Archives Centre, the Papers of Lord Jenkin, JENK 4/1/1/2.
See Nigel Fisher, Iain Macleod (London, 1973) pp. 263–265.
Heath speech to Party Conference, October 1965, quoted in Andrew Roth, Heath and the Heathmen (London, 1972) p.191 (author’s emphasis).
Anthony Barber, Taking the Tide: A Memoir (Norwich, 1996) pp. 103–105.
For example, Ralph Howell, Low Pay and Taxation (London, 1976, Low Pay Paper No.8).
See Vito Tanzi, et al. Taxation: a radical approach; a reassessment of the high level of British taxation and the scope for its reduction (London: Institute of Economic Affairs, 1970);
Barry Bracewell-Milnes, The Measurement of Fiscal Policy: an analysis of tax systems in terms of the political distinction between ‘right’ and ‘left’ (London, 1971, CBI).
See, for example, Alan Prest, Social Benefits and Tax Rates: a short study of implicit and explicit marginal tax rates in England and Wales (London: Institute of Economic Affairs, 1970);
Alan Prest, et al. The State of Taxation (London: Institute of Economic Affairs, 1977) pp. 21–32.
See, for example, Frederick Tooby, Excessive Taxes Lead to ‘Stag-flation’ (London, 1972, Economic Research Council).
See Economic Research Council, Excessive Taxes Lead to Inflation and Unemployment (London, 1978) p. 8.
C.T. Sandford, J.R.M. Willis, and D.J. Ironside, An Accessions Tax (London, Institute for Fiscal Studies, 1973).
C.T. Sandford, J.R.M. Willis, and D.J. Ironside, An Annual Wealth Tax (London, Institute for Fiscal Studies, 1975). As to the Wealth Tax, see below.
IFS vol. II, report in Glasgow Herald on 24.2.76 of conference held on 23.2.76. The IFS organised a conference in 1975, chaired by Samuel Brittan, on ‘Indexing for Inflation’: Thelma Liesner, and Mervyn King, Indexing for Inflation (London, Institute for Fiscal Studies, 1975).
See also, M.F. Morley, The Fiscal Implications of Inflation Accounting (London, Institute for Fiscal Studies, 1974).
John Kay and Mervyn King, The British Tax System (Oxford, 1978). Kay and King were both members of the Meade Committee.
A series of articles in The Sunday Times, collected as: Robert Bacon and Walter Eltis, Britain’s Economic Problem: Too Few Producers (London, 1976).
Frank Field, Molly Meacher, and Chris Pond, To Him Who Hath: A Study of Poverty and Taxation. (Harmondsworth, 1977).
See Howell, Low Pay and Taxation; Ralph Howell, Why work?: A Challenge to the Chancellor (London, 1976, CPC).
See Cedric Sandford, Chris Pond and Robert Walker, Taxation and Social Policy (London, 1980) p. 169.
For a contemporaneous academic analysis, see J. A. Mirrlees, ‘An Exploration in the Theory of Optimum Income Taxation’, The Review of Economic Studies, vol. 38, no. 2 (April 1971) pp. 175–208.
Edmund Dell, A Hard Pounding: Politics and Economic Crisis, 1974–1976 (Oxford, 1991) p. 113.
In fact, although the tax system was highly progressive in principle, only one and a half in a thousand tax payers paid the 83 per cent rate (in 1978/9): see Alan Gillie, ‘Redistribution’ in M. Artis and D. Cobham (eds) Labour’s Economic Policies 1974–1979 (Manchester, 1991) p. 238.
Douglas Hibbs, Jr and Henrik Madsen, ‘Public Reactions to the Growth of Taxation and Government Expenditure’, World Politics vol. 33, no. 3, pp. 413–435 (1981) at pp. 413–415.
Ian Gough, The Political Economy of the Welfare State (London, 1979).
Tony Westaway, ‘Stabilisation Policy and Fiscal Reform’ in Peter Maunder (ed.) The British Economy in the 1970s (London, 1980) pp. 24/25.
Howell Interview. The details were set out in a pamphlet: David Howell, A New Style of Government (London, 1970).
Conservative Political Centre, Masterbrief 25: Scaling Down Government (London, CPC, 1969) pp. 9/10.
Kathleen Jones, The Making of Social Policy in Britain: from the Poor Law to New Labour (3rd edn, London, 2000) p. 159.
See Patrick Bell, The Labour Party in Opposition, 1970–1974 (London, 2004) pp. 171–174.
Denis Healey, The Time of My Life (London, 1989) pp. 380/1. This was 5.4 per cent of GDP.
See Barbara Castle, The Castle Diaries (London, 1980) entry for 14.3.74, p. 41; Note, Andrew Graham to Donoughue, 29.3.74 and Note of the same date, Donoughue to Prime Minister, DNGH 1/1/1. According to Donoughue, ‘[the need for cuts] was obvious to me from the moment we began’: Donoughue Interview.
In the Governor’s Memo of 19.12.74: Douglas Wass, Decline to Fall (Oxford, 2008) pp. 84–87.
Leo Pliatzky, Getting and Spending: Public Expenditure, Employment and Inflation (Oxford, 1984, rev. edn) pp. 156–162.
For an account of these developments, see, for example, Bernard Donoughue, Downing Street Diary, vol. Two: with James Callaghan in No.10 (London, 2008) pp. 104–110; Dell, A Hard Pounding, pp. 266–273.
Wynne Godley, quoted in Maurice Wright, ‘Public Expenditure In Britain: The Crisis of Control’, Public Administration (1977) vol. 55, no. 2, pp. 143–170, at p. 143.
Peter Jackson, ‘Public Expenditure’ in M. Artis and D. Cobham (eds) Labour’s Economic Policies 1974–1979 (Manchester, 1991) p. 81.
Jackson, ‘Public Expenditure’ Table 5.2. p. 79. See also Ken Judge, ‘The Growth and Decline of Social Expenditure’ in A. Walker (ed.) Public Expenditure and Social Policy: An Examination of Social Spending and Social Priorities (London, 1982) pp. 27–48.
See, for example, Timothy Raison, Tories and the Welfare State: A History of Conservative Social Policy since the Second World War (Basingstoke, 1990) pp. 96/97.
See, for example, David Alexander, A Smaller Public Sector and the Priority for a Free Society (London, Selsdon Group Brief, 1976).
Digby Anderson, June Lait and David Marsland, Breaking the Spell of the Welfare State: strategies for reducing public expenditure (London, Social Affairs Unit, 1981) p. 19.
Gordon Pepper and Geoffrey Wood, Too Much Money? (London, IEA, 1976) pp. 34–36.
Milton Friedman, Capitalism and Freedom, 40th Anniversary edition (Chicago, 2002) pp. 191–195.
For a very full contemporaneous review of such phenomena, see Ridley’s Paper, ‘Public Expenditure in the United Kingdom — the biggest crisis of all?’, 1978, Private Papers of Sir Adam Ridley. For the wider issues, see William Baumol and William Bowen, Performing Arts — the Economic Dilemma (New York, 1968), and the subsequent literature.
See, for example, Memo ACP/3/(52)19 ‘Home Ownership’, quoted in Stuart Ball (ed.) The Conservative Party since 1945 (Manchester, 1998) p. 107.
Conservative Party, October 1974 Conservative Party General Election Manifesto Putting Britain First (London, 1974). Heath imposed this commitment on a reluctant Thatcher, the then Environment Spokesman: Moore, Margaret Thatcher, p. 262. A less devoted observer than Moore agrees that, at this election, Heath was imposing populist policies on Thatcher: Patten Interview.
Conservative Party, 1979 Conservative Party General Election Manifesto (London, 1979).
Peter Willmott, The Evolution of a Community; A Study of Dagenham after Forty Years. (London, 1963) pp. 102–108.
The deputy librarian of Barking in 1961, quoted in Roy Greenslade, Goodbye to the Working Class (London, 1976) p. 14.
Harold Turner, The Sale of Council Houses on the Becontree Estate, Dagenham, p. 5 (Hull, 1978, held at the London Borough of Barking and Dagenham, Archives and Local Studies Centre).
Suzanne Kelly, The Becontree Estate, Contemporary Life 1963–1988, pp. 92, 104 (1989); held at the London Borough of Barking and Dagenham, Archives and Local Studies Centre).
Labour Party, Election Manifesto, February 1974 (London, 1974).
See generally, Cedric Sandford, ‘The Diamond Commission and the Redistribution of Wealth’, British Journal of Law and Society, vol. 7, no. 2 (Winter, 1980) pp. 286–296.
See, for example, John Barnes, ‘Ideology and Factions’ in S. Ball and A. Seldon (eds) Conservative Century: The Conservative Party since 1900 (Oxford, 1994) p. 332;
Kevin Hickson, ‘Inequality’ in Kevin Hickson (ed.) The political Thought of the Conservative Party since 1945 (Basingstoke, 2005).
Chris Pond, ‘Taxation and Public Expenditure’, in A. Walker (ed.) Public Expenditure and Social Policy: An Examination of Social Spending and Social Priorities (London, 1982) pp. 49–69, at p. 52; and Gillie, ‘Redistribution’, p. 245.
See, for example, Colin Robinson and Jon Morgan, Effects of North Sea Oil on the United Kingdom’s Balance of Payments (London, 1976): ‘no substitute for domestic enterprise and competent economic management’, p. 1.
See A.M. Gamble, and S.A. Walkland, The British Party System and Economic Policy, 1945–83 (Oxford, 1984) pp. 174–176.
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Williamson, A. (2015). Tax and Spend: Towards a Smaller State?. In: Conservative Economic Policymaking and the Birth of Thatcherism, 1964–1979. Palgrave Studies in the History of Finance. Palgrave Macmillan, London. https://doi.org/10.1057/9781137460264_3
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