Heath’s Challenges

Question 1

Issues with his Chancellor

Answer 1

• initially appointed Iain Mcleoud who was very highly skilled
• unexpectedly died 4 weeks later
• major setback for party and was replaced by Anthony Eden

Question 2

What was decimalisation

Answer 2

• 1971 - modernising the economy
• Britain still used old pounds, shillings and pence (12p = 1 shilling, 20 shillings = £1)
• replaced by decimal currency
• last major country to switch to this

Question 3

Why did Heath do a U-Turn in terms of lame duck industry

Answer 3

• Feb 1971 - Rolls Royce bankrupt
• they employed 80000 and 14th largest employer in the uk
• developing new aero engine RB211 and ran out of money
• June 1971 - Upper Clyde Shipbuilders went into receivership
• loss of tens of thousands of jobs who would then claim employment benefits
• promised not to support them though?

Question 4

What did Heath do about this?

Answer 4

• had to nationalise both companies
• long term wise move to save jobs and one of most successful exports
• national humiliation to policies - Labour and unions laughed

Question 5

What happened with Margaret Thatcher in 1971?

Answer 5

• 1946 - free school milk to improve health and diet
• 1960s - stop in secondary schools to save money
• 1971 - Edcuation minister Thatcher decided to stop this for anyone above 7
• £14 million spent a year which was twice as much as on books
• very unpopular public decision which nearly got her sacked - ‘Maggie Thatcher Milk Snatcher’
• later apologised and admitted that a small amount had been saved at the cost of making the government look ‘uncaring’
• 1980 - horrified when Health Secretary Ken Clarke suggested ending it
• ‘This will cause a terrible row - all for £4m - I know - I went through it 19 years ago’

Question 6

What was the Industrial Relations Act of 1971

Answer 6

• aimed to succeed where Place of Strife Failed
• reaction from unions was predictable
• Feb 1971 - before even passed - 140000 march in Trafalgar Square to protest against removal of union rights
• ‘Kill the Bill’ protests in Glasgow
• In March 1,500,000 members of the Amalgamated Engineering Union staged a one day strike

Question 7

What did the Act say

Answer 7

1. It restricted the right of workers to strike (including a ban on ‘wildcat’ strikes).
2. Required unions to put themselves on a government register if they were to keep their rights
3. Set up a neutral National Industrial Relations Court (NIRC) to judge the validity of strike actions and settle
   disputes

Question 8

1972 miners strikes

Answer 8

• January 1972 - miners demand pay rise and did this in winter so caused most disruption they could
• reliant upon them highly
• 6 weeks into the strike, Britain began to run out of electricity
• February 1972 - ‘state of emergency’ imposing a ‘three day week’ where electricity was rationed
  
  • factories only allowed to operate 3 days a week - industry output fell
  • tv shutdown at 10:30
  • powercuts

Question 9

What did heath decide to do?

Answer 9

• 28th February he had to give in to the miners
• 27% pay rise
• bought himself some more time but troubles were only just beginning

Question 10

What was unemployment like?

Answer 10

• 1972 - 1 million unemployed for the first time since the Great Depression in the 1930s
• at the time this shocked Britain and sparked demonstrations outside the House of Commons and anger inside

Question 11

What was the ‘Barber Boom’ of march 1972

Answer 11

• made a huge mistake in the budget and decided to cut taxes by £1 billion
• called it a ‘dash for growth’ and predicted a 10% growth but misjudged BADLY
• produced stagflation - people has more to spend to prices rise and unions demand higher wages if prices are higher
• if paid more, industrial costs rise so prices rise so demand high wages
• no economic growth