Section 5 - Economy

• Stop-go economic policies were followed by Conservative Chancellors which used interest rates to control economic growth.
• Interest rates would be raised if the economy was growing too quickly and borrowing money would become more expensive.
• Interest rates would be cut if the economy slowed and credit would be easier to access.
• The budget was manipulated to win more support in elections.
• The Chancellor introduced tax cuts in the 1959 budget so people could spend more.
• Experts could see an increasing number of problems in the economy and Macmillan's team of Treasury Ministers resigned in 1957 over stop-go.
• Treasury Ministers wanted reduced government spending.
• The government preferred to promote economic growth and set up NICKY and NEDDY in 1961.
• NEDDY stood for the National Economic Development Council which oversaw the planning of growth.
• NICKY stood for the National Incomes Commission who wanted the regulation of wage demands.
• The government announced a pay pause in July 1961 as they were trying to curb excessive pay demands.
• The period of 1951-64 saw a period of economic growth but underlying problems were there during this period that would later resurface.
• There was a very small difference between Labour and the Conservatives on the economy with both parties supporting Butskellist policies.
• Butskellism comes from the names of Rab Butler and Hugh Gaitskell.
• Butskellism wanted to maintain full employment and economic growth.
• Butskellism wanted to continue the development of the welfare state.
• Economies grew in Western Europe in the 1950s because of Marshall Aid.
• The issue with the balance of payments was that Britain imported more than it exported and Britain's deficit value in 1961 was £95m.
• Britain couldn't afford to build a competitive and modern economy and welfare state and defence commitments could not be maintained.
• People spoke of "Stagflation" where workers demanded pay rises as inflation grew.
• Britain's debt was at £540m in 1957 and at £800m in 1964.
• Macmillan made a famous speech in 1957 which said that the British people "never had it so good".
• Despite high employment, unemployment was growing in Britain.
• 367,000 Britons were unemployed in 1951 but 563,000 were by 1958.
• In his "never had it so good" speech, Macmillan said to "go around the country and you will see prosperity".
• Jennifer Worth wrote the Call the Midwife memoir which stated that "by the 1950s most houses had cold water and toilets in the yard outside".