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Labour Government 1964 70 Essay

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Do you agree with the view that, in the years 1964-70, the Labour Government's failures outweighed its successes?

One of the most significant failures of the Labour government between the years 1964 and 1970 were the economic difficulties. Source 7 agrees with this very strongly as it states that they had “not got the economy right”. This could be highlighting Labour's National Plan launched by George Brown, the Minister of Economic Affairs at the time, in 1965. The Plan aimed to stimulate industrial production and exports by supporting collaboration between the government, employers and trade unions. It predicted an economic growth rate of 3.8% and a 25% increase in exports by 1970. However, due to the balance of payments crisis, Wilson and Callaghan (Chancellor of the Exchequer), were forced to impose £500 million worth of cuts and to increase taxes. This is shown in Source 9 when it states that there will be “no tax cuts for time being”. Therefore, the National Plan was cut and instead of being part of a plan for economic growth, it became a plan to cut wages. The statement in Source 7 could also be a reference to the balance of payments crisis that the Labour government was experiencing as there was a large difference in the money the UK was receiving from exports and the money they were spending on imports. This was made worse by how much stronger the dollar was than the pound as every £1 was worth $2.80. In 1964, there was an account deficit of £400 million due to the balance of payments crisis. Britain was spending too much on defence and not enough on industry. This was because Britain was changing from an industrial economy to a post-industrial one, which meant that the manufacturing industries were shrinking and the service and finance industries were expanding. Due to these economic difficulties, Wilson approached the International Monetary Fund (IMF), which was a scheme intended to prevent countries from going bankrupt, and asked them for a loan of £1 billion in 1964. However, Wilson had to ask the IMF for another loan in 1967, and he realised that this was only a temporary solution. This statement fr...

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