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Labour Conference 1976

“An unbridgeable gap between
government and party”

(October 1976)

From Militant, No. 325, 8 October 1976, pp. 2–3.
Transcribed by Iain Dalton.
Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

The 1976 Conference must be seen as one of the most important for decades. It marks a watershed in the development of the labour movement and in the life expectancy of the Labour government itself.

An atmosphere of crisis permeated the Winter Gardens and the ghost of Ramsay MacDonald haunted the corridors of the Imperial Hotel.

At the TUC conference opposition to government policy was expressed in muted terms, and the social contract was endorsed by a massive majority. In the eyes of the government the scheme must have seemed to be set fair for the party conference. In advance resolutions concerning mandatory reselection of parliamentary candidates and resolutions on nationalisation of the big monopolies had been removed from the agenda using the guise of the archaic ‘three year rule’. With this example of blatant political censorship and with careful stage management, the leadership hoped that government policy would be endorsed by conference establishing firmly the party leader.

After they had successfully defeated a number of attempts to get the excluded resolutions back on the agenda, their hopes appeared to be confirmed. They could not have been more wrong. The bitterness, anger and frustration which has been building up in the ranks of the movement could not be contained. It burst through time after time in the course of the debates.

The decision to nationalise the top banks and insurance companies cannot be overestimated. The National Executive document, despite the abstention of the TGWU, GMWU and ASTMS, was carried by 3,314,000 to 526,000 – a six to one majority.

Bill Mullins [Solihull] moved a resolution which called for the whole of the banking and insurance industry to be brought into public ownership. Referring to the NEC document, he pointed out that this was the first time that the party had proposed to nationalise a profitable sector of the economy. “The frothing at the mouth that had followed the announcement of the nationalisation plans showed that Labour had touched a raw nerve. For the monopolies have played about in the currency markets and have made hundreds of millions of pounds.”

The conference made their decisions despite enormous pressure. The hysterical ranting of the City of London, the withdrawal of support for the pound by the Bank of England, the blackmail by its international counterparts, and the dire warnings of the Tory press were all to no avail.

Tumultuous applause greeted the closing sentence of Mikardo’s speech when he said “the Prime Minister said he will oppose the proposals, I myself will support them, and that makes it one all. Now I want Conference to score the winning goal”.


When the results was announced, the sombre face of Callaghan contrasted starkly with the joyous feeling that spread through the conference floor. An enormous unbridgeable gap has opened up between the ranks of the movement and the right wing Cabinet led by Callaghan.

This was also demonstrated by the attempt to get Prentice reinstated as the Parliamentary candidate for Newham North East led by Frank Chapple from the EETPU. This move was rejected with a derisory handful of votes in favour. Throughout conference differences were expressed in a way not seen since the period 1929–31.

On the first day there is no question that the opponents of the social contract won the argument. But the platform won the vote. Ted Mooney [Liverpool, Walton] said inflation was running at a yearly rate of 21% based on last month’s figures. This was despite two years of wage restraint, which had led to a fall in living standards of 8%. This showed that wage increases were not the cause of inflation.

Mike Levene [Coventry South West] challenged Denis Healey’s forecast of 6% growth. “This is completely utopian”, he said . “And so was his forecast that unemployment would fall to 700,000 by 1978.”

Pat Wall [Shipley] complained that successive incomes policies and wage freezes since 1961 had done nothing to help the low paid or strengthen the economy.

Social Contract

Neither Bryan Stanley who replied for the National Executive nor anybody from the rostrum denied these arguments. Instead the platform invoked a theme they were to use again and again during the conference – ‘Opposition to wage restraint or the social contract would bring down the Labour government and let in the Tories.’

But it is precisely these policies which are a sure recipe for the defeat of a Labour government. Socialist policies would strengthen that government. Nevertheless the burning anger about unemployment mounted as delegate after delegate complained to the government for allowing unemployment to rise to one and a half million. Delegates demanded that the government take immediate action. As one pointed out, determined action was supposed to have been taken to halt unemployment under the terms of the social contract. But all the contribution of Albert Booth, the Employment Minister, amounted to was that ‘we are as worried as you are’ ‘there are no easy answers but we must stick to the social contract!’


The press deliberately distorted the mood at Conference. In the main the reception given to Healey after his speech on the IMF loan on Thursday was one of hostility, and the TV cameras must have had a difficult job finding groups of delegates who could be viewed as ‘enthusiastic supporters’ of his speech. The attempt by some of his Cabinet colleagues to stage a standing ovation fell flat. Delegates were furious when Healey tried to save face and stood up and waved his hands in the air like a victorious prize fighter for the benefit of the TV cameras.

So too with Callaghan’s speech on Tuesday morning. The reception could best be described as cool. It was a speech that was a throwback to the days of Gaitskell. His pugnacious bully-boy arguments could have been made by any Tory Prime Minister. The speech amounted to a vigorous defence of the profit motive and a call for sweat, toil and tears by the working class in order to save capitalism from collapse.

Eric Heffer put it at the Tribune Meeting: “What are members of the National Executive to say to a speech which the Daily Mail can represent as a speech that would have sounded well enough from a Tory Prime Minister with his back to the economic wall.”

The mood of delegates in itself was a reflection of the mood in the CLPs and trade union branches. It built up to a crescendo in the debate on cuts in public expenditure. The motion from the National Union of Public Employees backed local councils which refused to cut public expenditure and called for a campaign by the labour and trade union movement against the cuts. It was carried by a large majority. It was of enormous diplomatic importance, showing the contradictions inherent in the political situation. On the one hand conference voted for the maintenance of the social contract and on the other hand they voted against one of its most important aspects in the eyes of the government.

Whatever the confusion it must be without precedent in the history of the Labour Party that the party conference has called on Labour councillors to refuse to implement the policies of their own government!


This is another graphic illustration of the rising revolt of the rank and file against the policies of the right wing Cabinet. Their sole basis of support now resides in the Parliamentary Party.

This conference showed in outline many uncanny a parallel with the period before the formation of the National government in 1931. There were open clashes between left and right and violent altercations between members of the NEC which were leaked to the press. There was great disenchantment within the trade unions. There were heated discussions in trade union delegations sometimes boiling over into angry shouting matches. Rumour and counter rumour circulated the hall. This was commented on by the Chairman in his closing remarks and also in the press.

Conference is no more than a reflection of the processes developing in the labour movement itself. It signposts the general direction in which the labour movement in heading. The sign of this year’s conference is unmistakable! “Warning coalition ahead!”

Spending Cuts

Referring to the conditions required for the new £2,300 million loan from the IMF, the Guardian on Friday said:

“There is much apprehension at Blackpool this week, as much amongst the ‘social democrats’ as on the left. A further round of heavy spending cuts coming on previous cuts which all too clearly have failed to deliver dividends in retaining confidence will make it impossible for Mr Jones and Mr Foot to hold the line ...

“... today they have all gone home from Blackpool leaving behind a party more at war with itself than any time since the days of Gaitskell ... the Prime Minister and the great majority of his colleagues in the Cabinet and the Parliamentary Party are not in business to proclaim the breakdown of capitalism and engineer the arrival of a fully fledged socialist society. If that means civil war, the government against the party, then so be it.”


All this is a terrible warning to the ranks of the movement which they will ignore at their peril. There is a substantial number of Labour members of Parliament who would cross the floor of the House and join the Tories without looking out of place. The conspiracies against the labour movement that are taking place behind the scenes will not be defeated by making concessions to the right wing. It is only by the NEC alerting the party to these dangers and boldly mobilising the ranks of the movement behind a socialist programme to transform society, that the conspiracy to split the labour movement can be defeated.

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