Download Issues in British Politics by Colin Pilkington (auth.) PDF

By Colin Pilkington (auth.)

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The term 'full employment' never did mean 100 per cent employment of the workforce, since the pattern of work is not static and at any one moment there has to be a certain number who have either just left a job or are about to go into one: nor should we forget that there are those who are, by any criterion, unemployable. Keynes himself was prepared to accept unemployment figures of up to 6 per cent within his definition of full employment, while Beveridge preferred a lower figure of 3 per cent.

A tax on income is a progressive tax in that the more you earn the more you pay. This effect can be heightened by progressively increasing the differential rate at which income tax is levied as an individual's income rises. At the same time, a series of allowances and exemptions reduces the tax of the low-paid. During the last Labour government, in the late 1970s, the standard rate of income tax was set at 33p in the pound while the top tax band reached its peak at 83p in the pound. At the same time, the sum an individual was allowed to earn before paying tax - the personal allowance - was index-linked to rise in line with the cost of living and the general level of earnings.

Despite periodic troughs of unpopularity over specific issues such as unemployment, public perception of the Thatcher governments held that she had rescued Britain from the economic troubles of the 1970s. That confidence in Conservative competence survived the departure of Margaret Thatcher and was a major factor contributing to the surprise Conservative victory in the 1992 general election. Yet within five months that confidence collapsed in the currency speculation and devaluation of'Black Wednesday' that same September.

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