Page last updated at 11:38 GMT, Friday, 5 September 2008 12:38 UK

Then was the winter of our discontent

Anne Perkins
The Archive Hour, BBC Radio 4

Trade unionists are gathering again this weekend for the TUC just as they did 30 years ago at the congress that triggered the Winter of Discontent.

Leicester Square in 1979
Leicester Square was dubbed Fester Square during the winter of 1979

Once again they meet against a backdrop of government demands for pay restraint.

Public sector employees have been offered 2%, half the inflation rate.

They are planning synchronised strike action that might echo those weeks in early 1979 when the dead went unburied and school children feared they'd have to cross picket lines to get to their exams.

Listen to Then Was the Winter of our Discontent at 2000 GMT on Saturday on BBC Radio 4

The economy is rocky, in the midst of what the Chancellor thinks is the worst downturn for 60 years. Is it the moment that new Labour has dreaded, when the past it thought it had broken with returns to destroy its election prospects for another generation?

Like all earthquakes, the Winter of Discontent was a long time in the making. You could trace it back to Keynes' General Theory in the 1930s, which became the blueprint for Britain's post war settlement, the balance between on the one hand, full employment and a welfare state and on the other, economic growth.

It resulted from the pressure between conflicting demands: one the one hand, high state spending on welfare and on the other, maintaining a place at the global top table. Success depended on a strong economy. Instead, Britain seemed locked in a downward spiral where the declining value of sterling and inflationary pay claims led to low industrial productivity and inflation that in turn led to a weak pound.

Backbench revolt

One big problem were price increases to pay for wage deals that were not justified by higher productivity. On the right, the power of trade unions - representing more than half the work force, including the rapidly growing public sector - to go on strike without a ballot, official backing or compulsory arbitration was widely and bitterly criticised.

Even Labour, as long ago as 1969, had tried to legislate for union reform: Harold Wilson's government had nearly fallen after a union-inspired backbench revolt led in cabinet by Jim Callaghan.

Ted Heath came to power in 1970 with the same agenda, and was defeated in his turn by the power of trade unions to disrupt everyday life - and the miners' strike of 1973-4 that turned off lights and closed down factories all over Britain.

Nurses picket line 1979
Nurses were among those striking for more pay

Labour returned to power in 1974 as the government that could handle the unions. And through the Social Contract, an arrangement concocted by Employment Secretary Michael Foot and the leader of the country's most powerful union, Jack Jones of the Transport and General Workers, a pay policy was agreed that held down wage increases, even closed a little the gap between the highest and lowest paid workers, that lasted until the end of 1977.

The danger for Labour was that it was now even more closely identified with the unions, and their unpopularity damaged the party's own standing.

The trade unions had an unprecedented political influence but at the expense of their members' pay packets. And by 1978, their members were not prepared to support it any more. They wanted a catch-up pay settlement, and a return to free collective bargaining.

Trouble brewing

But inflation had been cut from 27% to single figures. And Labour was favourite to win an election that was expected that October. Everyone assumed it would be announced at the TUC congress in September 1978. But Jim Callaghan, Labour prime minister since 1976 and a man whose political career was built on his trade union background had decided a few more months would embed the economic turn around and prove he had defeated inflation.

He chose to delay it despite the opposition of several Cabinet ministers, and his trade union friends who knew trouble was brewing.

Callaghan and Chancellor Denis Healey had agreed that pay rises for 78-79 should aim at about 5%. But the men and women who had delivered the 'economic miracle' wanted a payback. Especially those who worked for companies like Ford that were making such handsome profits that the company boss, Terence Beckett, had just had an 80% pay rise.

Healey realises now that he should have fudged it and asked for something "in single figures".

Dock workers at Felixstowe in 1979
Unofficial walk-outs sprang up across the country

The Transport and General Workers Union put in a claim for a 30% pay rise. It was like a call to battle. The Ford negotiations opened the season, and everyone watched like hawks. An unofficial strike soon became official. Five weeks later, they settled for around 17%. Callaghan knew then he had lost the election.

After Ford there was no doubt the unions were not going to moderate their pay claims. The second part of the anti-inflation policy was price control, enforced by a vast bureaucracy that was testing the faith in the state of even the most born and bred Labour man as the prices minister, Roy Hattersley.

The third part of the strategy was a government power to impose sanctions on employers who breached pay guidelines. By the time Ford settled, it was only one of more than 200 companies that had paid well over 5%.

Strikes spread

But no sanctions could be imposed without a Commons vote. Labour was a minority government, and a some of its own backbenchers agreed with the unions that pay rises were nothing to do with government.

An attempt to get authority for sanctions was defeated. There was now nothing credible left of the anti-inflation strategy on which Callaghan had elected to be judged. As pay claims, and supporting strikes, escalated to include fuel tanker drivers, the only recourse left was to declare a state of emergency and call in the army to ensure that supplies got through.

But Callaghan could not bring himself to challenge the unions so directly.

In a freezing January, the strikes spread to public sector - not just the aristocrats of the workforce, the engine drivers and railwaymen (seeking 20% and a new bonus scheme) but the worst paid, the municipal workers like school dinner ladies and grave diggers, the people who do the jobs that keep society going.

James Callaghan
James Callaghan decided to delay a general election

These were the men and women who had at first done well from a Labour government but for the two previous years seen pay rises below inflation, and who could see the target of earning two thirds of the national average wage receding, not approaching.

Early in the New Year, Jim Callaghan was due in Guadeloupe for a four nation summit followed by a few days in Barbados. To the consternation of his advisers, he decided it would look worse if he cancelled than if he went.

'What crisis?'

So as Britain shivered in exceptional January temperatures - four consecutive weeks below zero - the nightly TV news showed the prime minister on the beach in his swimming trunks.

And again defying his advisers, on his return he chose to give a news conference at Heathrow. By turns jovial and testy, his demeanour (though not, of course his words) led The Sun newspaper to declare the following day, "Crisis? What Crisis?". The image of a prime minister out of touch with the country was complete.

Margaret Thatcher in 1979
Margaret Thatcher promised to tame the unions

January was the month when the rubbish went uncollected - Leicester Square became an official dump and was unofficially renamed Fester Square. It was the month the dead went not just unburied, but were left on wards for hours at a time. When hospital managers struggled to find a way of coping with bodies that were starting to decompose. When ambulance drivers refused to answer emergency calls, and pickets on the dockside blocked the unloading of drugs needed for chemotherapy.

According to National Union of Public Employees official, Rodney Bickerstaffe, who was later to become its General Secretary, his union members who were already low paid, were provoked by a substantial cuts in their real wages and by what they saw as the government's absolute refusal to recognise the importance of their role in society by paying them a decent wage.

Meanwhile, Conservatives who had fought the election of March 1974 under the unfortunate slogan, "Who governs Britain?", had spent the intervening years restoring channels of communication with the union movement that it now believed it could not defeat.

Labour of course was out of power for 18 years. When it won, it was as New Labour, a party that accepted the Thatcher revolution

But that was to reckon without Margaret Thatcher, elected Tory leader in the wake of Edward Heath's humiliation. Rather than rely on the traditionalists like the young Chris Patten running the research department at Conservative Central Office, she had authorised a parallel group led by a successful businessman, John Hoskyns. He had devised a series of stepping stones to rebuilding the national economy. Curbing trade union power was high on his list.

Tory victory

Mrs Thatcher was struggling to be taken seriously as the leader of the official opposition. Jim Callaghan ran rings round her in the Commons, she seemed unsure of where she was taking the party.

As the industrial nightmare unfolded Hoskyns pressed his case against the caution of the official employment spokesman, Jim Prior. He found an increasingly willing audience in Mrs Thatcher. For the first time, the first female leader of a major political party had a cause that chimed with her own instincts, and that of the public. Standing up to the trade unions became her mantra.

In the end it was not the strikes that actually brought down Labour, but a row with the Scottish Nationalists over devolution. Six months earlier Labour had been favourites to win its third consecutive election. By May, victory for a Tory party that was committed to confronting the trade unions was not in doubt.

For the first time since Stanley Baldwin, Britain had a leader who wanted to roll back the state. Bankrolled by unaccustomed oil wealth, prepared to tolerate levels of unemployment not seen since the 1930s, Mrs Thatcher chose confrontation as a route to reconstruction.

Without Argentina's attack on the Falklands, it might not have worked. Without Labour's fratricidal wars, it might have failed.

Labour of course was out of power for 18 years. When it won, it was as New Labour, a party that accepted the Thatcher revolution.

The trade unions have yet to recover. Union membership has halved, privatisation and the loss of manufacturing have emasculated the most powerful of the trade unions.

One great achievement, according to Rodney Bickerstaffe, to rise from the ashes of defeat: the minimum wage, finally introduced in 1999.

And the TUC struggles, still, to protect vulnerable workers, both migrant labour, and the hundreds of thousands of low-paid Britons.

Winter of Discontent: 30 years on
04 Sep 08 |  Business
Your 1970s: Strikes and blackouts
07 Jun 07 |  Magazine
1979: Thatcher wins Tory landslide
05 Apr 05 |  past_elections
Lord Callaghan tributes pour in
27 Mar 05 |  UK Politics


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