The National Government

The experience of the National Government during the economic crisis
1. Implelemented public spending cuts
  1. Cut public sectors pay by 10%
  2. Means test for unemployment benefit
2. The Special Areas Act
  1. Identified regions in need of direct government assistance
  2. Only provided limited investment
  3. 'too little too late'
3. The depression did not last as long in Britain as it did in other countries
  1. Real incomes rose by 19%
    Annotations:
    - Increase in income after taking inflation into account
  2. Industrial production rose by 46%
  3. GNP rose by 23%
  4. Exports increased by 28%
  5. Unemployment fell from 17% to 8.5%
4. Removal from the Gold Standard
  1. Cut in interest rates
    Annotations:
    - Borrowing for businesses and individuals became cheaper. People invested more in property . This fueled a housing boom. The number of new houses built grew from 133 000 in 1931 to 279 000 in 1935
  2. Banks became more willing to spend again
  3. Stimulated economic growth by restructuring war debts
    Annotations:
    - Cost the country 25% of tax revenue as opposed to 40%
The problems faced by the National Government over rearmament
The role of the National Government during the Second World War
1. Developed specific ministries
  1. The Ministry of Aircraft Production
  2. The Ministry of Supply
  3. The Ministry of War Production
  4. The Ministry of Food
  5. The Ministry of Labour and National Service
  6. All ministries has legal powers
    1. Could take over wartime industries
    2. Decreased role of market forces
2. The government decided production levels
  1. Not market forces
    Annotations:
    - In peacetime production was determined by prices for goods and profits; during wartime production levels were decided by the government

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The National Government

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	Created by Holly Bamford about 8 years ago