Winter of Discontent
The Labour governments of Harold Wilson and James Callaghan had been fighting for several years against inflation, which had peaked at 26.9% in the year to August 1975, but wished to avoid large increases in unemployment. As part of the campaign to bring down inflation, the government had agreed a 'social contract' with the Trades Union Congress which allowed for a voluntary incomes policy in which the pay rises for workers were held down to limits set by the government. Previous governments had brought in incomes policies backed by Acts of Parliament, but the social contract agreed that this would not happen.
Phase I of the pay policy was announced on 11 July 1975 with a white paper entitled The Attack on Inflation. It proposed a limit on wage rises of –6 per week for all earning below –8,500 annually. The TUC general council had accepted these proposals by 19 votes to 13. On 5 May 1976 the TUC accepted a new policy for the forthcoming year's negotiations of increases beginning 1 August between –2.50 and –4 per week; at the annual Congress on 8 September that year it rejected a motion which called for a return to free collective bargaining (which meant no incomes policy at all) once the agreement expired on 1 August 1977. This proposal became Phase II of the incomes policy.
On 15 July 1977 the Chancellor of the Exchequer Denis Healey announced Phase III of the incomes policy in which there was to be a phased return to free collective bargaining, without "a free-for-all". After prolonged negotiations, the TUC agreed to continue with the increases recommended for that year under Phase II limits and not to try to reopen agreements made under the previous policy, while the Government agreed not to intervene in pay negotiations. The Conservative Party criticised the lack of any stronger policy. The inflation rate continued to fall through 1977 and by 1978 the annual rate fell below 10%.
Despite having prepared for the end of the incomes policy, on 21 July 1978 Denis Healey introduced a new White Paper which set a guideline for pay rises of 5% in the year from August 1 (Callaghan's initial preference had been for 3%, but other ministers considered this totally unachievable). The TUC voted overwhelmingly on 26 July to reject the limit and insist on a return to free collective bargaining. Unexpectedly, on 7 September, Prime Minister James Callaghan announced that he would not be calling a general election that autumn but seeking to go through the winter with continued pay restraint so that the economy would be in a better state in preparation for a spring election. The pay limit was officially termed 'Phase IV' but most referred to it as 'the 5% limit'. Although the government did not make the 5% limit a legal requirement, it decided to impose sanctions on government contractors who broke the limit.
Although not an official guideline, the pay rise set by Ford Motors was accepted throughout private industry as a benchmark for negotiations. Ford had enjoyed a good year and could afford a large rise, but was a major government contractor. The management at Ford therefore made a pay offer within the 5% guidelines; 15,000 Ford workers, mostly from the Transport and General Workers Union (TGWU) began an unofficial strike on 22 September, and the TGWU made it official from 5 October (the number of participants grew to 57,000). During the strike, Vauxhall Motors employees accepted an 8.5% rise. After long negotiation in which they weighed the chances of suffering from government sanctions against the continued damage of the strike, Ford eventually revised their offer to 17% and decided to accept the sanctions; Ford workers accepted the rise on 22 November.
As the Ford strike was starting, the Labour Party conference began at Blackpool. Terry Duffy, the delegate from Liverpool Wavertree Constituency Labour Party and a supporter of Militant Tendency, moved a motion on 2 October which demanded "that the Government immediately cease intervening in wage negotiations". Despite a plea not to put the motion to the vote from Michael Foot, the resolution was carried by 4,017,000 to 1,924,000. The next day, the Prime Minister accepted the fact of defeat by saying "I think it was a lesson in democracy yesterday", but insisted that he would not let up on the fight against inflation.
Meanwhile the government's situation in the House of Commons was increasingly difficult. It had lost its majority in 1976 and had been forced to put together a pact with the Liberal Party in 1977 in order to keep winning votes, but this pact had lapsed in July 1978. The decision to grant extra Parliamentary seats to Northern Ireland ensured temporary support from the Ulster Unionist Party, but the Unionists were clear that this support would be withdrawn immediately after the Bill to grant extra seats had been passed. It was through the Ulster Unionists agreeing to abstain that the government defeated a motion of no confidence by 312 to 300 on 9 November.
By the middle of November it was clear that Ford would offer an increase substantially over the 5% limit and the government entered into intense negotiation with the TUC, hoping to produce an agreement on pay policy that would prevent disputes and show political unity in the run-up to the general election. A limited and weak formula was eventually worked out and put to the General Council of the TUC on 14 November, but the General Council ended up tied 14–14 on its adoption and it was rejected on the Chair's casting vote. One important personality on the TUC General Council had changed earlier in 1978 with Moss Evans replacing Jack Jones at the TGWU. Evans proved a weak leader of his union although it is doubtful whether Jones could have restrained the actions of some of the TGWU shop stewards.
After Ford settled, the government wasted no time and on 28 November announced that sanctions would be imposed on them, along with 220 other companies, for breach of the pay policy. The announcement of actual sanctions produced an immediate protest from the Confederation of British Industry which announced that it would challenge their legality. The Conservatives also put down a motion in the House of Commons to revoke the sanctions. A co-ordinated protest by left-wing Labour MPs over spending on defence forced the debate on 7 December to be postponed, but when it went ahead on 13 December, an amendment against the sanctions was passed by 285 to 279. The substantive motion as amended was then passed by 285 to 283. James Callaghan put down a motion of confidence for the next day, which the government won by 10 votes (300 to 290), but accepted that it could not use sanctions. In effect this deprived the government of any means of enforcing the 5% limit on private industry.
With effectively no means of enforcing the pay policy, unions which had not yet put in pay claims began to increase their aim. The first to take extreme action were lorry drivers, members of the TGWU. Large numbers of the lorry drivers worked on oil tankers, and drivers working for BP and Esso began an overtime ban in support of rises of up to 40% on 18 December. With supplies of oil being disrupted, the Cabinet Office prepared 'Operation Drumstick', by which the Army were put on standby to take over from the tanker drivers. However, the Operation would need the declaration of a state of emergency in order to allow conscription of the assets of the oil companies, and the government drew back from such a step. Before the situation developed into a crisis the oil companies settled on wage rises of around 15%.
From 3 January 1979 an unofficial strike of all TGWU lorry drivers began. With petrol distribution held up, petrol stations closed across the country. The strikers also picketed the main ports. The strikes were made official on 11 January by the TGWU and 12 January by the United Road Transport Union. With 80% of the nation's goods transported by road, essential supplies were put in danger as striking drivers picketed those firms that continued to work. While the oil tanker drivers were working, the main refineries were also targeted and the tanker drivers let the strikers know where they were going, allowing for flying pickets to turn them back at their destination. More than 1,000,000 workers were laid off temporarily during the disputes.
A further plan was drawn up to safeguard essential supplies through the Army and calling a state of emergency. The government warned the TGWU leadership of the plan, which resulted in the union accepting (12 January) a list of emergency supplies which were officially exempt from action. In practice, what counted as an emergency was left up to local officials of the TGWU to determine, and practice across the country varied according to the views of the local shop stewards who established 'dispensation committees' to decide. When strikers in Hull did not allow the correct mix of animal feed through to local farms, the farmers dropped the bodies of dead piglets and chickens outside the union offices; the union contended that the farmer had actually wrung the chicken's necks to kill them, and the piglets had been killed when the sow rolled over and crushed them.
On 29 January, lorry drivers in the south west accepted a deal awarded by an arbitration panel of a rise of up to 20%, just –1 per week less than the union had been striking for; this settlement proved a model which was accepted throughout the country.
On 10 January, James Callaghan arrived back from a summit in Guadeloupe in the middle of the lorry drivers' strike. Having been tipped off that the press were present, his press secretary Tom McCaffrey advised him to say nothing and return immediately to work, but his political adviser Tom McNally thought that the image of Callaghan returning and declaring his intent to take control of the situation would be reassuring. Callaghan therefore decided to give a press conference at Heathrow airport. To McNally's dismay Callaghan was jocular and referred to having had a swim in the Caribbean during the summit. He was then asked (by a reporter from the Evening Standard) "What is your general approach, in view of the mounting chaos in the country at the moment?" and replied:
The next day's edition of The Sun featured the famous headline "Crisis? What crisis?" with a subheading "Rail, lorry, jobs chaos–and Jim blames press".
With many in the private sector having achieved substantial rises, the public sector unions became increasingly concerned to keep pace in terms of pay, especially for those paid lowest. The government had already announced a slight weakening of the policy on 16 January, which gave the unions cause for hope that they might win. Train drivers of ASLEF and the National Union of Railwaymen had already begun a series of 24-hour strikes, and the Royal College of Nursing conference on 18 January decided to ask that the pay of nurses be increased to the same comparative level as 1974, which would mean a 25% average rise. On 22 January the public sector unions held a "Day of Action", in which they held a 24-hour strike and marched to demand a –60 per week minimum wage. This was the biggest individual day of strike action since the general strike of 1926, and many workers stayed out indefinitely after that day.
With the succession of strikes having been called and then won, many groups of workers began to take unofficial action – often without the consent or support of the union leaderships. Ambulance drivers began to take strike action in mid-January, and in parts of the country (London, West Midlands, Cardiff, Glasgow and the west of Scotland) their action included refusing to attend 999 emergency calls. In these areas, the Army was drafted in to provide a skeleton service. Ancillary hospital staff also came out on strike. On 30 January, the Secretary of State for Social Services David Ennals announced that 1,100 of 2,300 National Health Service hospitals were only treating emergencies, that practically no ambulance service was operating normally, and that the ancillary health service workers were deciding which cases merited treatment.
The most notorious action during the winter was the unofficial strike by gravediggers, members of the GMWU, working in Liverpool and Tameside. As coffins piled up, Liverpool City Council hired a factory in Speke to store them. On 1 February a persistent journalist asked the Medical Officer of Health for Liverpool, Dr Duncan Dolton, what would be done if the strike continued for months, Dolton speculated that burial at sea would be considered. Although his response was hypothetical, in the circumstances it caused great alarm. The gravediggers eventually settled for a 14% rise after a fortnight's strike.
With many collectors having been on strike since 22 January, local authorities began to run out of space for storing waste and used local parks under their control. Westminster City Council used Leicester Square in the heart of London's West End for piles of rubbish, and as the Evening Standard noted, this attracted rats.
On 21 February a settlement to the local authority workers' dispute was agreed whereby workers got an 11% rise, plus –1 per week, with the possibility of extra rises should a pay comparability study recommend them. Some left-wing local authorities, among them the London Borough of Camden, conceded the union demands in full (known as the 'Camden surplus') and then saw an investigation by the District Auditor which eventually ruled it a breach of fiduciary duty and therefore illegal. Camden Borough councillors, among them Ken Livingstone, avoided surcharge of the costs of their illegal policy. Livingstone was Leader of the Greater London Council by the time the surcharge decision was made.
Prior to the "Winter of Discontent", the Callaghan government had sought (in 1976) an International Monetary Fund loan of –2.3bn to combat the rampant inflation at that time. This was perceived as marking a key moment in the country's post-war economic decline and helped pave the way for Margaret Thatcher's 1979 general election victory.
Strikes by essential services dismayed many senior ministers in the Labour government who had been close to the trade union movement, who thought it unlikely that trade unionists would take such action. Among these was Prime Minister James Callaghan himself, who had built his political career on his connection to the trade union, and had practically founded one union (the Inland Revenue Staff Federation) himself. In 1969 Callaghan had led a cabinet revolt which led to the abandonment of a proposed reform of trade union law outlined in a white paper called 'In Place of Strife'; had this reform been implemented, most of the action during the Winter of Discontent would have been illegal.
The government continued to negotiate with the senior union leaders and on 11 February came to agreement on a proposal to be put to the TUC General Council. On 14 February the General Council agreed the concordat, which was published under the title 'The Economy, the Government, and Trade Union Responsibilities' (the significance of Valentine's Day was remarked upon by the press). By this stage the degree of control which the union executives had over their members was limited and strikes did not immediately cease, although they began to wind down from this point. In total in 1979, 29,474,000 working days were lost in industrial disputes, compared with 9,306,000 in 1978.
The strikes appeared to have a profound effect on voting intention. According to Gallup, Labour had a lead of 5% over the Conservatives in November 1978, which turned to a Conservative lead of 7.5% in January 1979, and of 20% in February. On 1 March, referendums on devolution to Scotland and Wales were held. That in Wales went strongly against devolution; that in Scotland produced a small majority in favour which did not reach the threshold set by Parliament of 40% of the electorate. The government's decision not to press ahead with devolution immediately led the Scottish National Party to withdraw support from the government and on 28 March in a motion of no confidence the government lost by one vote, precipitating a general election.
Conservative Party leader Margaret Thatcher had already outlined her proposals for restricting trade union power in a party political broadcast on 17 January in the middle of the lorry drivers' strike. During the election campaign the Conservative Party made extensive use of the disruption caused during the strike. One broadcast on 23 April began with the Sun's headline "Crisis? What Crisis?" being shown and read out by an increasingly desperate voiceover interspersed with film footage of piles of rubbish, closed factories, picketed hospitals and locked graveyards. The scale of the Conservatives' victory in the general election has often been ascribed to the effect of the strikes, and the party used film of the events of the winter in election campaigns for years to come.
Following Mrs Thatcher's election win, she brought the post-war consensus to an end and made drastic changes to trade union laws (most notably the regulation that unions had to hold a ballot among members before calling strikes) and as a result strikes were at their lowest level for 30 years by the time of the 1983 general election, which the Tories won by a landslide.
The use of the term 'winter of discontent' in an industrial relations context was first used by Robin Chater (now Secretary-General of the Federation of European Employers) as a headline in an issue of Incomes Data Report (1977). But its first use in a newspaper was in the London Evening Standard in late 1978. Standard sub-editor Chris Stevens used it as a headline on a story by political reporter Robert Carvel.
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