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UK Confidential Monday, 1 January, 2001, 00:42 GMT
Wilson's economic gamble
Harold Wilson
Harold Wilson: Did he play politics with the economy?
The Labour government started 1970 ahead in the polls. But as polling drew nearer, documents disclosed for the first time appear to show that Prime Minister Harold Wilson was considering some unexpected economic tactics...

Election year politics can be risky business- as today's leaders of the UK's main parties may quite easily find out in the coming months.


If we lost the Election, the Conservative Party would have to shoulder the responsibility for dealing with the potentially inflationary problem which they would have inherited

Harold Wilson in Cabinet, 1970
But documents disclosed to the public for the first time under the UK's 30-Year Rule reveal that in 1970, Labour Prime Minister Harold Wilson considered postponing economic decisions because of the impending election that his Chancellor, and possibly others, believed may have been bad for the country.

At the turn of 1970, the Wilson government was ahead in the national polls - and was predicted to be returned to office.

But in a shock to many, he was thrown out when the Conservatives led by Edward Heath squeaked in at the June 1970 General Election.

But documents seen by BBC Television's UK Confidential documentary reveal that he feared that lead would slip unless he put off critical public sector wage decisions - something that could lead a successor government with major economic problems.

Wages woes

In February 1970, the government was facing a number of key wages claims from nationalised industries, including threats of impending strike action by docks workers.

A top secret cabinet document from 1970
CAB 128/46: Wilson's wages proposal
But according to Cabinet office documents marked top secret, Mr Wilson proposed a different approach to dealing with what the government feared would be an impending economic crisis.

Mr Wilson asked the cabinet on 12 February to consider the wage claims not just on their merits but "in terms of their political implications during a period in which the Government must face an approaching General Election."

Mr Wilson told the Cabinet that excessive wage settlements could provoke an economic crisis in which the "Government's freedom of electoral manoeuvre could be seriously affected".

He went on that it would be "desirable" to defer any wage increases until after a General Election.

"If (the Labour Party) lost the Election," he went on, "the Conservative Party would have to shoulder the responsibility for dealing with the potentially inflationary problem which they would have inherited."

Jenkins objects

Not all of the Prime Minister's Cabinet colleagues agreed with the realpolitik.

A top secret cabinet document from 1970
CAB 128/46: Roy Jenkins opposed plan
The then Chancellor of the Exchequer, Roy Jenkins, warned Mr Wilson that the proposed course would leave the economy in "an increasingly vulnerable condition". In other words, political plotting could be putting the entire recovery at risk.

"It could be argued to be better for the Labour Party that they should lose the General Election and leave behind them a record of sound management of the economy than they they should put that record at risk in order to achieve victory," he said.

Defending Wilson

In an interview for UK Confidential (available in full on this special website), the then Cabinet minister Barbara (now Lady) Castle, defended the Wilson policy - saying it was no different to that of any other government's thinking.

"It's absolutely routine that governments, particularly when they are facing an election, wish to postpone as far as possible the awkward decision until when the eleciton is over," she said.

"Every party does it, it's happening now.

"The opposition is always in the advantageous position of being able to dodge facing up to the real questions.

"Roy Jenkins was pressing his points too hard. It's extremely interesting that you get the vanity of chancellors.

" They love to be seen as prudent and balancing the books. "What was striking about this situation in 1970 was that we went into the election with everybody saying we would walk it."

They didn't. While the Cabinet backed the Prime Minister, the plan failed to stop the Conservatives taking power and a new prime minister, Edward Heath, taking office.


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Wilson's gamble

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