The 'Winter of Discontent' & the Fall of Labour, 1978-1979 (AQA A Level History: Component 2: Depth study): Revision Note

Callaghan's leadership

Callaghan as prime minister (1976-1979)

Marion S. Trikosko / U.S. News & World Report Collection, Library of Congress, Prints and Photographs Division, LC-DIG-ppmsca-53218. Public domain.

• James Callaghan became prime minister in April 1976, following Harold Wilson's resignation

  • He was the only prime minister to have held all four great offices of state:

    • Chancellor of the Exchequer

    • Home Secretary

    • Foreign Secretary

    • Prime Minister

• He brought long experience and close links with the trade unions

• Callaghan led a minority government for most of his premiership

  • The Lib-Lab Pact of 1977 secured Liberal support for key Commons votes

  • When the pact ended, Labour relied on support from nationalist MPs

• His government remained in office despite having no overall Commons majority

Callaghan's strengths and weaknesses

Callaghan and the trade unions

• Callaghan's authority partly rested on his relationship with the unions

  • He had helped defeat 'In Place of Strife' in 1969

  • He had consistently opposed legal restrictions on trade union power

• Union leaders had supported several years of voluntary pay restraint

  • In return, Labour introduced social reforms and repealed Heath's industrial relations legislation

• By 1978, the relationship was under growing strain

  • Three years of pay restraint had reduced real wages

  • Lower-paid public-sector workers had fallen further behind

• Jack Jones retired as leader of Transport and General Workers' Union (TGWU) in 1978

  • His successor, Moss Evans, was less willing to restrain wage demands

• National union leaders were also finding it harder to control local disputes

  • They could agree pay restraint with the government but could not always secure the support of their members

• Industrial unrest grew before the Winter of Discontent: mass picketing at the Grunwick film-processing plant (1976–1978) and a national firefighters' strike (November 1977–January 1978) tested the government's pay policy

The decision to delay the election

• Callaghan was widely expected to call a general election in autumn 1978

  • Inflation had fallen below 10%

  • Unemployment had started to fall

  • Labour and the Conservatives were close in the opinion polls

• At the TUC Congress on 5 September 1978, Callaghan suggested that an election might be called

  • Two days later he announced on television that there would be no election in 1978

• Callaghan expected the economy to improve further

  • North Sea oil production was increasing

  • Another year of recovery might have strengthened Labour's position

• The decision left the government facing the winter with its 5% pay policy already under pressure

  • Once the winter strikes began, Labour could not choose a good moment for an election until the crisis was over

The 'Winter of Discontent', 1978-1979

The 5% pay limit

• In July 1978 the government introduced a 5% limit on pay increases for the coming year

  • This was the fourth stage of the incomes policy that had operated since 1975

  • Inflation was still around 8%, so a 5% rise led to a further fall in real wages

• The policy lacked support

  • The TUC rejected the limit in autumn 1978

  • The Labour Party conference also voted against it

• The government had no legal power to enforce the limit in private companies

  • Its main sanction was to withhold government contracts from employers that agreed larger pay rises

The Ford strike and the collapse of pay policy

Ford strike, 1978. Photographer unknown; reproduced from a Red Notes publication. Image via Alexei Schwab/Flickr.

• Ford workers rejected a 5% offer and began strike action in late September 1978

  • Around 57,000 workers were involved across Ford's British factories

• After nine weeks Ford agreed to a 17% pay settlement in November 1978

• The government initially planned to penalise Ford for breaking the limit

  • In December 1978, MPs voted against imposing the penalty

  • The government was left without an effective way to enforce the 5% policy

• The Ford settlement became the figure against which other unions measured their own pay claims

Strikes in transport and distribution

• Road haulage drivers in the TGWU began strike action in January 1979

  • They eventually secured pay rises of around 20%

• Secondary picketing spread the effects of the dispute

  • Pickets targeted ports, depots and factories that were not directly involved in the original strike

  • Supplies of petrol, food, and industrial materials were disrupted

• Because lorries carried goods between ports, factories, shops and fuel depots, the action affected large parts of the economy

Public-sector strikes

• Public-sector workers followed the haulage drivers into dispute during January and February 1979

• The National Union of Public Employees (NUPE) and other unions organised a National Day of Action on 22 of January 1979

• Those taking industrial action included:

  • hospital ancillary workers

  • school caretakers

  • refuse collectors

  • grave diggers

• The disruption became highly visible

  • Refuse remained uncollected in some areas

  • Army ambulances were held in reserve during the ambulance workers' dispute

  • A strike by grave diggers in Liverpool attracted widespread press attention

The effect of the winter weather

• Britain experienced its coldest winter for 16 years

  • Snowstorms cut off some areas and added to transport problems

• Uncollected refuse in Leicester Square and delays to burials in Liverpool became prominent images of the crisis

  • They received extensive television and newspaper coverage

How large were the disputes?

• The strikes were smaller than the miners' disputes of 1972 and 1974

  • Most settlements reached by March 1979 averaged around 10%

• Many of the strikes were unofficial

  • National union leaders did not always call or control the action

  • This showed the growing difficulty union leaders faced in securing the support of local members

• The political impact was greater than the economic scale of the disputes

  • Images of picket lines, closed hospitals and uncollected refuse shaped public opinion

  • Labour appeared unable to maintain its pay policy or control industrial unrest

Approach: As a magazine that generally supported free market economics, it presented the strikes as a threat to contracts, public order, and the wider economy. Its examples show how opponents of the unions described the crisis but its dramatic predictions should be compared with the scale and eventual settlement of the disputes

Callaghan's return from Guadeloupe

© News Group Newspapers Ltd / The Sun, 11 January 1979

• Callaghan returned from an international summit in Guadeloupe on 10 of January 1979

• He told reporters that he did not accept that Britain faced mounting chaos

• The Sun reported his comments under the headline "Crisis? What crisis?"

  • Callaghan did not use those exact words

  • The headline, however, became closely associated with the government's response

• By 1979, most national newspapers, including The Sun, the Daily Mail and the Daily Express, supported the Conservatives

Approach: Kenneth Williams was a well-known comic actor and broadcaster who kept detailed private diaries. He was not a politician or trade unionist, but he held strongly right-wing views and followed the news closely

His entries from January and February 1979 are useful for showing how the Winter of Discontent appeared to an ordinary member of the public through newspapers and television. However, his political views shaped what he noticed, so he focused on disorder, strikes and hostility towards the unions rather than giving a balanced account of the disputes

The collapse of the Labour government

The loss of parliamentary support

• The Lib-Lab Pact had kept Labour's minority government in office from March 1977

  • The 13 Liberal MPs agreed to support the government in important Commons votes

  • In return Labour consulted the Liberals and agreed to continue with plans for devolution

• Liberal leader David Steel ended the pact in the summer of 1978

  • The agreement was not renewed

• Labour then depended increasingly on support from the nationalist parties

  • The Scottish National Party (SNP) expected the government to introduce devolution for Scotland

    • This made the outcome of the devolution referendum important to Labour's survival

The devolution referendums, 1 March 1979

• Voters in Scotland and Wales were asked whether they supported the government's plans for devolved assemblies

  • These assemblies would take responsibility for some domestic matters

  • Westminster would remain the UK Parliament

• The Scotland Act (1978) and the Wales Act (1978) required referendums before devolution could take effect

• Labour backbencher George Cunningham added a clause to the Scotland Act

  • At least 40% of the whole electorate had to vote in favour

    • This meant that abstentions counted in practice against devolution

Results

• The government did not bring the Scotland Act into force

  • The SNP withdrew its support

    • SNP MPs then backed a motion of no confidence against the government

The vote of no confidence, 28 March 1979

• Conservative leader Margaret Thatcher tabled a motion of no confidence

• The Conservatives, Liberals and SNP voted against the government

• Plaid Cymru voted with Labour

  • The party had secured a compensation scheme for quarry workers suffering from dust-related diseases

• The government lost by 311 votes to 310

  • This was the first time since 1924 that a government had been defeated in a confidence vote

• Callaghan announced that Parliament would be dissolved and a general election held

Approach: Callaghan's reference to the minority parties voting for an early Christmas was aimed particularly at the SNP and Liberals, warning that an election might cost them seats

The source is useful for showing Callaghan's tactics during the debate. However, it was a final attempt to discourage opposition MPs from bringing down the government rather than a detailed explanation of why Labour had lost its parliamentary support

The general election, 3 May 1979

• The Conservatives based their campaign on:

  • trade union power

  • unemployment

  • law and order

• The Saatchi and Saatchi poster "Labour isn't working" attacked Labour's unemployment record

• Press coverage of the Winter of Discontent continued throughout the campaign

  • Most national newspapers were hostile towards Labour

• The result was a clear Conservative victory

Results

• The Conservatives won a majority of 43

• Labour's share of the vote fell by just over two percentage points, from 39.2% in October 1974 to 36.9%

• The Conservative share rose more sharply

  • This was helped by falling Liberal and SNP support

  • Large numbers of skilled and unskilled workers voted Conservative for the first time

Approach: The extract comes from the 1979 Conservative general election manifesto, written to persuade voters to remove Labour from office. It presents the Winter of Discontent as evidence that Labour had allowed trade unions too much power and that the country had lost confidence and direction

The source is useful for showing how the Conservatives framed the election campaign. However, it was designed to win voters, so its language exaggerates Labour's responsibility and does not give a full account of the economic or industrial problems

Why did the post-war consensus break down by 1979?

• The post-war consensus had been weakened throughout the 1970s

• By 1979 both the economic policies and political agreements that had supported it were breaking down

  • The factors below contributed to the breakdown of the post-war consensus

The failure of incomes policy

• Pay restraint had been the main method used to control inflation since 1975

• The government's 5% pay limit collapsed in 1978

  • It was rejected by the TUC

  • It was also rejected by the Labour Party conference

  • Ford workers secured a 17% settlement, setting a precedent

• In December 1978, MPs prevented the government from penalising firms that broke the limit

  • The policy could no longer be enforced

• Both main parties concluded that national incomes policies had failed

  • No later British government attempted a similar national pay policy

The breakdown of cooperation with the unions

• The consensus assumed that governments, employers, and trade unions could work together

  • This approach had continued under Labour's 'Social Contract'

• By 1979, national union leaders could no longer guarantee the support of their members

  • Many of the strikes during the Winter of Discontent were unofficial

  • The government could no longer rely on union leaders to deliver wage restraint

• Labour had won the elections of 1974 partly by claiming it could work more successfully with the unions than the Conservatives

  • The disputes of 1978 to 1979 weakened that claim

Long-term economic weakness

• Stagflation had challenged the economic aims of the post-war consensus throughout the 1970s

  • Full employment and low inflation could no longer be maintained together

• The 1976 IMF loan was followed by reductions in public spending

  • This weakened the belief that governments could manage the economy through higher spending

• British productivity remained below that of several major competitors

  • Both Labour and the Conservatives used this to argue that existing economic policies needed to change

The rise of New Right ideas

• Free market ideas gained support during the 1970s

• Monetarism offered a different explanation for inflation

  • It focused on the supply of money rather than wage demands alone

• The Centre for Policy Studies, founded by Keith Joseph and Margaret Thatcher in 1974, promoted:

  • lower government spending

  • reduced state intervention

  • greater reliance on the market

• Callaghan also questioned an important part of the consensus

  • In his 1976 Labour Party conference speech, he rejected the idea that governments could spend their way out of recession

  • A Labour prime minister had, therefore, publicly challenged a policy associated with earlier post-war governments

The loss of Labour's parliamentary support

• The post-war consensus had operated within a mainly two-party political system

• Labour's parliamentary position weakened after 1974

  • Its majority of three disappeared by 1976

  • The Lib-Lab Pact ended in 1978

  • Labour then depended on support from nationalist MPs

• The growth of the Scottish National Party (SNP) and Plaid Cymru weakened the traditional two-party pattern in Scotland and Wales

• The failed devolution referendums led the SNP to withdraw its support

  • Labour lost the vote of no confidence on 28 March 1979

• Conservative victory in May 1979 brought to power a government that openly rejected several parts of the post-war consensus

Approach: Thatcher gave this speech while opening the no-confidence debate on the 28th March 1979. As leader of the opposition she wanted MPs to remove the Labour government and prepare the ground for a Conservative election campaign. Her emphasis on excessive government power, trade union influence, defence and law and order shows the main New Right criticisms of the post-war consensus

However, the speech was intended to defeat the government, so it presents Britain's problems in a way that supports a Conservative case for change