Labour and the Five Giants

fact that Britain was in depression and that the unemployed, elderly and families with a large number of children remained in poverty. To deal with this four pieces of legislation were passed. These were Family Allowances Act 1945, Industrial Injuries Act 1946, National Insurance Act 1946 and the National Assistance Act 1948. However, Labour were solely responsible for just one of these. The Family Allowance Act was introduced by the coalition government in 1944 and passed by Labour in 1945. It provided for a weekly allowance of 5 shillings, which was paid to the wife and financed out of general taxation. It was open to all families with more than one child as long as the child was at school. The allowance increased with the cost of living.  The 1946 Industrial Injuries Act was inherited from the coalition government. It replaced the Workmen’s Compensation scheme. It was financed by the worker, employer and the state. Each would pay 4p per week and if the worker was injured at work, they would receive 45 shillings per week. This was much higher than the payment for ordinary sickness.  The National Insurance Act 1946 was based on the Beveridge report and the 1944  white paper. It offered comprehensive coverage from the ‘cradle to grave’. The employee, employer and the state, made contributions and in return would receive unemployment, sickness, maternity, widow benefit, guardian allowance, retirement pensions and death grants. The unemployment benefit was 26 shilling per week for a single adult and 42 shilling per week for a couple. This was only paid up to a maximum of 492 days. The levels of benefits were set in 1946 and by the time they were in action in 1948 the cost of living had increased reducing the purchasing value of the benefits.The National Assistance Act 1948 put an end to the poor law, as means tested payments were made to those in need, by the National Assistance Board, out of general taxation. This provided a safety net for those not covered by the National Insurance scheme. In particular, the elderly were badly hit and in 1949  48% of all national assistance was supplementing pensions. This had increased to 68% by the late 1950’s. The importance of this social security system was that it was the first to cover all areas. In the early 1950’s Rowntree revealed that poverty had been reduced to just 2%. On the other hand, Labour was only solely responsible for one of the four policies and national assistance was means tested meaning many people did not apply for it because of the stigma surrounding it. In Britain there was also a fear that there would be a repeat of the 1930’s Wall street crash resulting in mass unemployment but the 1944 white paper meant that Labour was committed to the maintainance of a high and stable level employment after the war. They were successful in doing this and by 1946 the unemployment figure was running at only 2.5%. Chancellor Dalton said “that full employment was the greatest revolution brought about by the Labour government”. Others argue that it was the post war boom and Marshall aid from America that reduced unemployment. The importance of this was that there was no return to pre war unemployment rates. However, there is uncertainty as to whether Labour should be credited with this or whether it was because of the post war boom. The chronic shortage of housing at the end of the war was the most pressing problem facing Labour. This was caused by the already housing shortage before the war, 700,000 destroyed during the war and hindered even more by the shortage of building workers and materials due to the war. Labour policy of housing was aimed at those most in need, working class. Therefore, most of the scarce building materials were allocated to the local authority to build council houses for rent. Between 1945-51, four council houses were built to every one private house. The Housing Act 1945 was passed. This allowed the local authorities to use open spaces as sites for temporary housing, these were to have a maximum of 20 years life span. Between 1945-8, 157,000 of these prefabs were built with little effect. Many families took to squatting on disused army camps in the summer of 1946 but the government decided not to prosecute and instructed the local authorities to provide basic services and amenities to these families. The New Town Act 1946 was passed and allowed for the development of selected towns and developments e.g East Kilbride, Livingston, etc. Between 1945-9 Labour built 432,000 houses, far more than the private sector an achievement considering the shortage of builders and materials. However, it was not enough as the 1951 census revealed there were 750,000 fewer house than families and they did very little to improve old and poor housing. Page  of