• Revision:The Labour Party 1918-45

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Labour at the end of the First World War – 1924

  • Many left wing Liberals, who felt little loyalty to their now divided party (Asquith, Lloyd-George) ‘drifted towards Labour’ (M. Pugh).
  • The war divided the Liberals, yet Labour remained strong, because war time pressures allowed them to maintain unity and cohesion in the defence of working class interests.
  • Took the leading role in social reform from the Liberals.
  • During the war, union membership increased from 4.1 million to 6.5 million, and many more became associated with the Labour Party.
  • In 1918, Labour candidates who showed any sign of opposing/criticising the war, were met with an overwhelming rejection from the voters. Patriotism was essential in the Coupon Election.
  • While not a successful election, Labour still won 22% of the Vote (Coupon Election), and was able to canvass over 350 candidates (compared to 1910 – 56). They also made sweeping gains in the Municipal Elections in 1919.
  • Post WW1 Labour became the ‘champion of traditional Liberal causes’ – social reform, Home rule, civil liberties etc.
  • The 1918 ‘Representation of the People’ Act, also greatly ‘swelled the ranks of Labour voters’ (Stephen Lee) – but not by an amazing amount, women (40%) tended to vote Conservative and many others did not naturally vote Labour, for several reasons, up to 1924 and beyond:
  1. Lack of experience.
  2. Fear of communism/socialism (Russia).
  3. Liquidisation of the British Empire.
  • 1918: Labour also adopted a new constitution, with its famous Clause IV on Public Ownership – many Historians are critical of this. Their new constitution allowed them to separate themselves from the Liberal Party, to whom they had been associated pre-1918.
  • They also gained valuable experience in the war-time coalition, but left in 1917 – under Arthur Henderson. Labour refused to take part in the new coalition Gov’t of post 1918 – Arthur Henderson, James Ramsay MacDonald and Philip Snowden all lost their seats.
  • Towards 1924, with the Liberal party divided, many grass-roots Liberal voters turned to Labour. The very fact that the Liberals canvassed an extremely low amount of candidates means that in many constituencies, the choice was between voting Conservative, Labour of abstaining.
  • 1922: Labour wins 142 seats, becoming the main opposition to the Tories.
  • 1923: Labour wins 191 seats, takes office with the help of the Liberals.
  • 1924: (January-October) Ramsay MacDonald leads a minority Gov’t.

The 1924 Government

1923 Results:, Conservative: 258, Labour: 191, Liberal: 159.

  • Baldwin remained as PM, but not for long – it was a hung parliament. He introduced bills on tariff reform, which were voted against by both Liberal and Labour resulting in a defeat.
  • Baldwin was more than happy to allow a Lab-Lib Gov’t to form; on the grounds that it would push many right-wing Liberals to the Tories, and that any radical actions by the Labour Gov’t could easily be vetoed by a Lib/Tory alliance. This also added further to the Liberal decline.
  • James Ramsay MacDonald became the first Labour PM, re-elected to Parliament in 1922. Labour was not harmonious under him, he appeared passionate as an orator, yet in person could be aloof (especially to the left wing of the party).
  • He brought in some former Liberals, such as Haldane, as Lord Chancellor. There was a great fear of this Gov’t being extremely radical – it was not. In fact it was a great disappointment to many socialists. The ‘Gladstone of the Labour Party’ (A.J.P. Taylor).
  • The Govvernment lacked success for a number of reasons:
  1. It was a minority Government, dependent upon Liberal votes, as such it had to pursue moderate policies. It was therefore out of the question to introduce nationalisation and disarmament. Therefore its policies were very similar to previous Liberal Governments.
  2. Difficulty in portraying a national image – put itself forward as the party of the industrial workers’. Mistrusted by many and linked to the militant trade unions.
  3. The Party was highly dependent upon Trade Unions for funds, in return TU’s expected to control the party, leading to friction. The 1924 Gov’t was given very little supported by TU’s. Almost immediately there was a Dockers strike. London Transport Workers then went on strike – MacDonald called a state of emergency, but the situation died down after employers caved in. Embarrassing for the Gov’t, left relations strained.
  4. Proved impossible to work out a joint plan of action between the Parliamentary Labour Party and TU’s.
  5. Economic situations: 1 million unemployed in 1924. No answer except nationalisation – which was out of the question.
  6. Many wanted MacDonald to introduced genuinely left policies – although they would be beaten, it would allow MacDonald to appeal to he electorate. He did not accept this, he preferred moderate policies, to gain the confidence of the country.

There were, although, some achievements:

  1. Grants were provided for the building of council houses.
  2. OAP and Unemployment benefit were increased.
  3. The number of free places at grammar schools increased and state scholarships to Universities re-introduced.
  • The end came rather suddenly, with the Campbell Case where the editor of the Communist Workers’ Weekly was arrested and charged with incitement to mutiny. The case was soon dropped.
  • Liberals/Conservatives alarmed at MacDonald’s opening of communications with Russia now accused the Gov’t of being Communist sympathisers. The Liberals demanded an enquiry, which was carried and followed with James Ramsay MacDonald’s resignations.
  • The election, was made more complicated by the appearance of the Zinoviev Letter in the Daily Mail four days before polling. It contained instructions to the British Communist Party on how to cause a revolution – many believed that Labour sympathy to Russia was causing the British Communists to open communications with the U.S.S.R.

1924 Results: Conservative: 419, Labour: 151, Liberal: 40.

  • Labour blamed the loss upon the Zinoviev Letter, but Historians tend to agree that they would have lost anyway. What the short term did allow, although, was to prove that a Labour Government could work – Ramsay MacDonald’s aim was successful. Seen as the ‘point of no return’ for the Liberal Party.
  • Disprove Churchill “Not fit to Govern”.
  • True victims were the Liberals, not Labour (Robert Pearce). Labour actually gained 1 million more votes – politics now polarised (Lab/Tory).

The 1929 - 35 Government

1929 Results: Labour: 288, Conservatives: 260, Liberal: 59.

  • Labour’s manifesto: ‘Labour and the Nation’. Content and application were very blank. They were very confident, insistence on building bridges and roads as well as employing men through public works. More a statement to create a ‘socialist common wealth’.
  • Two big issues of this Government: internal friction and unemployment.
  • The Gov’ts main achievements were in foreign policy, any domestic policies they wanted to implement were blighted by bad luck: The world economic crisis (The Great Depression).
  • By May 1931, the Unemployment level had risen to 2.5 million people – and there was a financial crisis.
  • Domestic Achievements were limited; once again more money was directed towards council housing, as well as the clearing of slums. This was suspended during the financial crisis (1931-4), by 1939, the vast areas of slums had been cleared – the job also created jobs. As well as this, a shortening of the miners work day for 8hrs to 7.5.
  • Unemployment was the key issue during this Government’s ministry, until their resignation, and the creation of the National Government under J. Ramsay MacDonald.
  • The effect of the Wall Street crash was not as sudden as in the U.S.A. or central America, because the U.K. had not experienced the boom of the 1920s. Unemployment was at 1 million at the start of Labour’s ministry, within a year it was at 2.5 million. By 1932, exports had fallen by 1/3 and unemployment was stagnant at 3 million – 23% of the insured workers!
  • The Gov’t was stunned and took no action. Many (such as Oswald Mosley) suggested Gov’t spending – with import restrictions and protective tariffs, control of banks etc. MacDonald and Snowden were far too cautious and cut Gov’t spending, hoping to revive trade. There was much support for Mosley’s ideas (especially from the Liberals), the leaders rejected this and so he resigned, forming a party, which had no success and then founded the British Fascist Party.
  • Ramsay MacDonald took control of Economic Policy, even though he had little/no specialisation in it.
  • Unemployment benefit was placing an extreme strain upon the Gov’t, a committee suggested a reduction in the salary of public sector jobs: civil servants, police, teachers – being the biggest cut at 20%, with the reduction in benefits being about the same. Eventually a 10% cut was allowed – of £78million, hurting those worst off during this crisis. This led to Henderson causing a split in the Gov’t and its resignation. The cut was also needed to encourage New York and Paris bankers to loan UK the money it needs to balance the payments and take itself out of a deficit and the country out of recession (the banker’s insisted upon a balanced budget before giving the loan).
  • 'Snowden’s’ Orthodox 1931 Budget also suggested a 10-25% cut in a those employed/paid by the Government – that meant Civil Servants, teachers and those in the armed forces. This led to the Invergordon Mutiny, crippling the Atlantic Fleet (now called the Home Fleet), which in turn caused a run on the pound – making the economic situation in the UK even worse. Britain also came off the Gold Standard.
  • Foreign Banks, following the collapse of the biggest Austrian Bank (Credit Anstalt) became very cautious, and so, with the report, believed Britain was on the verge of bankruptcy, this led them to withdraw all their gold, plunging Britain into a deeper financial crisis.
  • The Gov’t could not cope with the situation, and MacDonald claimed that the schism that had formed in the Gov’t of what should be done was to large for the Gov’t to continue. He therefore went to the King an handed in the Gov’ts resignation – but, stayed on as PM with a cabinet made mainly of Conservatives, Liberals and three Labour – the National Government (1931, August).

The National Government, under James Ramsay MacDonald

  • Ramsay MacDonald the betrayer? Originally he was seen as a traitor in 1914-18 for not joining a coalition, now he is labelled a traitor for joining one.

More Facts about James Ramsay MacDonald

  1. Majority of the Labour Party saw him as such. Furious with him, saw him as a traitor and expelled him from the Party.
  2. Some believe that George V and Baldwin convinced him to stay on, to avoid and election as well as restore confidence in the Government.
  3. Some suggest his real betrayal was earlier than 1931, when he would not take actions to avoid the crisis of 1931.
  4. Save the face of the Conservative Party – Neville Chamberlain: “Rich mans party cutting incomes of the poor.”
  5. Not working class therefore out of touch with the grass roots/origins of the party.
  6. ‘Born a socialist, he died a bloody Tory’
  7. Coalitions seen to be required only during war – why now?
  8. Only three Labour M.P’s joined the coalition Cabinet.
  9. Damaged the party extremely in the 1931.
  10. Only three members of the Labour cabinet joined the coalition.
  11. It blurred party differences and ‘failed the working man’.
  12. The National Government cut unemployment benefits by 10%.
  13. He had been corrupted by the establishment.
  14. Failed the Labour movement.

Some people suggest that MacDonald’s actions were not those of a traitor:

  1. Labour were inexperienced, how could they hope to cope on their own in office. Especially against the unprecedented problems they faced post Wall Street Crash.
  2. He was of key importance to their early Labour party and actually had nothing to gain, as he was already the PM – so seems unlikely he would seem himself as betraying his own party.
  3. Seen as emotionally connected to the party.
  4. Put the country over party politics, he was not a traitor, but rather a patriot. I.e. his main aims/goals were good – to lower unemployment and help the country get back on track.
  5. PM’s first duty is of national – not party, interest. He saw himself as responsible not to the Labour party but to the Country as a whole.

The main argument though, is that the lack separate parties in the commons, with only one dominant one – meant that new ideas were extremely unlikely to come to the surface – i.e. the Classical / Treasury view on the economy was held to be the best way to remove the country from depression. Keynesianism – promoted by the dwindling Liberal Party – may have helped as well.

1931 – 39

  • Labour’s share of seats went from 288  46. It was seen as a massacre.
  • Many Labour MP’s lost to Conservative’s backing MacDonald. A large part of the working class also voted against Labour. Partly due to the moderate image portrayed by Baldwin’s Conservative Party, in forming a National Government of ‘reconciliation’.
  • Many of the working class had been ‘depoliticised’ and were no longer concerned about Westminster or the old battle lines between the working class Labour Party and the rich man’s Conservative Party – but rather, were more concerned about the future of their jobs.
  • Labour now only drew support from those areas where the depression had done its worst (Jarrow, South Wales, Parts of Scotland, Tyneside), rather than areas who still showed signs of recovery.
  • The Party also fell quickly into deficit and officials at the Party’s HQ (Transport House) had to face a 5% cut in salary.
  • Lack of funds also meant that Labour had difficulty contesting by-elections and had to miss 5 alone in 1932.
  • New divisions were also forming, not on the grounds of unemployment, but foreign policy. Some in the party were supporting the peace and rearmament agenda of the NG. Whilst others favoured tougher measures. In 1935, Labour Leader Lansbury had to resign over the issue (he opposed sanctions on Italy) at the 1935 conference.
  • Divisions remained (over rearmament vs. not rearming) until a consensus was achieved in 1937. The party slowly recovered from 1935.
  • The percentage of the popular vote (Labour was still achieving an impressive amount, when compared to the Liberal Party – who were in terminal decline) was the key issue showing that all was not lost. The fact that three cabinet members had called for a coalition and other parties had responded – which almost guaranteed a victory – as it had done for L-G in 1918.
  • Labour were suffering from short term but alarming, fluctuations.
  • 288 seats in 1929 were 37.1% of the vote. Its 46 seats still represented 30.7% of the popular vote.
  • The Liberals, because of electoral deals with the Tories had 3.7% of the popular vote, yet held 35 seats.
  • The 1931 results was therefore Labour’s ‘bedrock’ (Lee). Things could only get better, and they did, in 1935, the achieved 37% of the vote, equating into only 154 seats.
  • Long before WW2, Labour’s recovery was underway. As is also confirmed by the number of by-elections won by Labour in the years preceding the war.
  • There was also a remarkable recovery of Labour in the Local Government elections – where they fared better than the Conservatives and the Liberals, gaining more than both put together (Labour gained 181, Conservatives 6 and the Liberals 5).
  • Recovery also took the form of internal consolidation, preparing Labour more effectively for political responsibility. Changes to the party’s constitution were also made.
  • As well as new programmes being put forward, such as: ‘For Socialism and Peace’ (1934) and other programmes which lay behind Attlee’s reforming ministry 1945-51.
  • The absence from Government had a long-term positive effect. Allowing the Labour Party to consolidate and shed the radical left with the decision of the Independent Labour Party to disaffiliate from the Labour Party in 1932.
  • Above all, the Labour Party benefited from a period of safe, unspectacular and steady leadership, under Clement Attlee. Unlike MacDonald he had a reputation for trustworthiness with every section of the Labour Party and also helped heal relations with the Labour Party and the TUC.
  • The Labour split was superficial. The key point is that MacDonald only took 3 ministers with him, the rest of the party remained relatively united. This was not equivalent to the schism in the Liberal Party, which produced rival allegiances to Asquith and Lloyd-George,.
  • The Party, was therefore able to vilify the man who contributed so much to its early development. In fact, the legend of Ramsay MacDonald’s treachery became and integral part of Labour’s recovery.


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