How successfully did the Labour governments of 1945-51 solve the social problems of the time?

Britain in 1945 was reeling from the social, political and economic impact of WWII, and was united in a desire for a better world than the one which spiralled into war in the 1930s. Britain faced five main social problems which were outlined in the 1942 Beveridge report: poverty, health, education, housing, and unemployment. Attlee’s Labour government tackled these issues with varied success, most notably with the creation of the National Health Service, seen by some historians as the greatest achievement of the Labour government, but by others as an overly expensive system that failed to substantially improve the lot of the average working class man. Labour also met with success in implementing National Insurance, which some historians see as providing tangible help ‘from cradle to grave,’ and was a “spectacular political and social achievement,” (Nicholas Timmins) although some complain that National Insurance did little to solve the fundamental causes of poverty, and instead only treated the symptoms. Success was more limited in providing housing for the needy; in 1951 there was still a major deficit in available houses, although one million homes had still been built. Labour failed to seriously alter British class structure (Robert Pearce) and indeed passed some measures which proved to worsen social divides, such as the grammar school system, according to Morrison.

The Beveridge report made many recommendations for changes to British society, separating the problems into ‘five giants,’ Want, Disease, Ignorance, Squalor and Idleness, although this distinction is misleading as his proposals were highly integrated as shown by the proposed National Insurance contributions which would pay for the many social changes Beveridge was suggesting. Key to his report, was the principle that the welfare state should be comprehensive, covering all aspects of society; universal and non-means-tested; compulsory and relying on full employment for funding through flat rate National insurance; and able to provide subsistence for those in need. While this report provided an outline of the problems Britain faced, it was by no means a clear guide to reform, for example, the Minister of Health, Bevan, had to “draw up plans for a comprehensive health service virtually from scratch.” (Pearce)

Labour tackled the issue of ‘want’ through the creation of a benefits system funded by National Insurance contributions, which became the cornerstone of the whole social security system. The National Insurance Act of June 1946 gave improved benefits to those injured at work, and an updated version of the Act in August 1946 gave benefits to the unemployed, the sick, widowers, mothers on maternity leave, pensioners and paid for funeral expenses, with an allowance of 26 shillings per week. This was clearly a major step towards the creation of a welfare state; however the acts came from a 1944 white paper from Churchill’s government, so credit cannot entirely be given to Labour. Labour deviated from the Beveridge report’s recommendation that benefits should be at the subsistence level, as this would be too expensive, instead they “were nearly a third below what Beveridge had recommended as necessary for subsistence,” (Brian Abel-Smith) and Morrison agrees, saying that welfare benefits in 1949 were only 19% of the average industrial wage and so well below subsistence level. Also, National Insurance payments were not index-linked with inflation, and therefore “could not eliminate poverty in a time of inflation.” (Pearce) However, National insurance still became “the key agency, providing ultimate protection to more than eight million persons.” (Nicholas Timmins)

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These acts were backed up by the 1948 National Assistance Act which was meant to be a safety net, providing extra help for those whose needs were not met by National insurance, and was therefore means tested. It soon became clear, however, that the original acts were insufficient: in 1949, 48% of pensioners applied for National Assistance. “This dependency of National Insurance benefits on means-tested assistance” compromised “the principle of universality and of benefits paid as of right,” and so limits the success of the Labour government. (J Heb) It is Katherine Woodroffe’s view, however, that the welfare state removed barriers to aid and de-stigmatised poverty. A tangible improvement in living conditions and mark of Labour’s success is shown in Rowntree’s reports of 1936 and 1950, which showed a decrease of primary poverty from 36% to 2% in York. That National Assistance existed at all, however, was an admission of the failure of National Insurance to solve social problems and provide a basis for the funding of the welfare state, as was shown by the fact that only 9% of NHS funding came from National Insurance in 1949. The combination of NI and NA were, however, largely successful in improving the financial situation of the working classes.

The National Health Service Act of 1946 gave free medical care to all British citizens of a wide ranging nature: GPs, dentists, opticians and hospitals were all to be provided for free, backed by National Insurance contributions. This was clearly a high minded vision which, according to Birch, became “the greatest single achievement in the story of the welfare state.” However, the NHS was not without its problems. It faced initial strong opposition from the British Medical Association and GPs in the run up to its implementation in July 1948. In early 1948, 90% of BMA members voted against the NHS Act, and as a result Bevan was forced to make concessions: consultants would be allowed to keep their private practices and could have lucrative ‘pay beds’ inside NHS hospitals; and Bevan set aside £66 million as compensation for the GPs who would lose their practices. A fee of 15 shillings was to be paid for each patient, in addition to a salary. By June of 1948, 90% of doctors had agreed to enter the NHS. Charles Webster, the official NHS historian, is very critical, saying that this partial privatisation resulted in a grossly unfair healthcare system which benefited the wealthy far more than the working classes.

The NHS was also faced with a large backlog of untreated ailments: 8.5 million had dental treatment; and 5 million pairs of glasses were produced in the first year of the NHS. In consequence, the NHS became very expensive, costing £358 million in 1950, even though prescriptions were never completely free, which was a necessary though unfortunate aspect of the NHS. Some historians, such as Correlli Barnett, link increased welfare spending with British decline, however Robert Pearce disagrees, pointing to successful competitors who spent more on social services. Martin Pugh argues that the reforms were in fact very cost effective due to the huge benefits of a healthy population. Undoubtedly, Labour’s success was very real as is evident from the vast number of prescriptions (187000 prescriptions issued by 18000 doctors in the first year) and tangible results for many millions, despite the difficult economic circumstances resulting from the war.

The Labour government inherited the Education Act of 1944 and had to put it into effect. The act would raise the school leaving age to 15 by 1947, and 16 as soon as was practical; it would split the school system into three, with optional nursery schools, and primary and secondary schools where attendance was compulsory. School meals and milk were to be made available to all, and a school medical system was to be developed. The act also recommended that secondary schools be divided into a tripartite system of grammar schools, secondary modern schools, and secondary technical schools where admittance was based on pupils’ abilities and aptitudes as tested by an ‘eleven plus’ test at the end of primary school. However, due to the damage or destruction of 20% of existing schools during the war, Attlee was forced to concentrate on replacing lost schools and building new primary schools to accommodate the ‘baby boom’ of 1942-47. (Pearce) 1176 new schools had been built by 1950, of which 928 were primary schools. This focus on primary education resulted in the secondary system becoming a dual system of academic grammar schools, and inferior secondary modern schools, where funding was lower despite representing a larger section of education. According to Morrison, this led to a “socially divisive and highly contentious selection procedure” which discriminated against pupils from working class backgrounds, most of whom left school early with no qualifications. This divide in society (just 20% of pupils went to grammar schools) was far from Labour’s socialist goal of breaking down barriers in society, and therefore a limiting factor in their success.

The government also tried to implement the 1944 Fleming Report which recommended that 25% of places at public schools should be reserved for pupils with local authority scholarships, but Pearce says this failed due to councils wanting to spend money on their own schools, and this ironically led to a “period of ‘socialist’ administration proving to be the heyday of the public school system.” Labour did, however, recruit 25,000 more teachers, and overall met with success in improving the education system, despite some serious problems remaining to be solved.

The most pressing problem facing Labour in 1945 was the chronic lack of housing: 700,000 houses had been destroyed during the Blitz which only exacerbated the already serious shortage of houses which existed before the war. In 1945 one third of all houses in Britain were in serious need of repair and renovation. The housing project was further hampered by a lack of construction workers and a major shortage and high cost of raw materials, with the result that the project was cut back on in 1949 at the Treasury’s insistence. Consequentially, the emphasis was placed on the construction of council houses for rent and temporary prefabricated homes to try and meet demand. Despite the construction of 160,000 prefabricated houses by 1951, the 1951 census revealed that there were still 750,000 more households than there were houses, roughly the same level as in 1931. However, Labour constructed four times as many council houses as private houses, and to a better standard than pre-war levels: average floor area had increased from 800 square feet in the 1930s to 1000 square feet under Attlee. This shows that, despite the difficult circumstances, Labour succeeded in building one million new homes by 1951, still not enough, but “a significant achievement none the less.” (Pearce)

The 1944 White Paper on Employment Policy had committed the government to “the maintenance of a high and stable level of employment after the war,” committing Labour to the principle of ‘full employment’ using Keynesian economic management strategies. This goal was, with the temporary exception of 1947, achieved, according to Kevin Jefferys. Unemployment in the North East coastal regions had been running at 38% in 1938, but by June 1951 this had been reduced to just 1.5%. Though the resumption of global trade after the war had much to do with this, Jefferys argues that the “role of ministerial policy” must not be underestimated; pointing out that “the same circumstances” after the First World War resulted in “a deep recession.” However, other historians claim that a mixture of post war boom and American Marshall Aid from 1948, to the value of £1263 million, were responsible. In the face of such economic strife, such as fuel shortages and the 30% devaluation of the pound in the winter of 1947, it is clearly to Labours credit that they maintained full employment, which was necessary to fund and complete the expensive welfare state successfully.

Labour’s policies, according to Arthur Marwick, clearly show their commitment to the idea of a welfare stare. They provided support for the poorest; free access to decent medical care; benefits for the elderly and unemployed; and eliminated the worst in slum housing, thus, in David Dutton’s view, continuing the work of the wartime coalition government. Woodroffe praises the welfare state for removing barriers and de-stigmatising poverty. While this is true, some barriers remained, such as the unfair education system, which favoured the wealthy and divided society. Pearce says that “Labour largely fulfilled its manifesto commitments, despite an adverse economic climate,” and Hennessy agrees, calling Attlee’s government this century’s “most hyper achieving peace time administration.” This is evidenced by the remarkable 347 Acts passed by the Labour government. Some historians, however, are less enthused, pointing to the lack of serious nationalisation, redistribution of wealth or social class change, saying that the fundamental causes of poverty were not tackled thoroughly enough: “One per cent of the population owned 80 per cent of the country’s private capital around 1950.” (Pearce) Despite these limitations, however, the Labour government of 1945 to 1951 was largely successful in reducing poverty, providing benefits, healthcare, and dealing with the social problems of the time.