First Labour Government
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First Labour Government 1924

General election 1922

  • Labour replaced Liberals as opposition
  • Won 142 seats, Asquith Liberals 62 and Lloyd George Liberals 54
  • Conservatives won majority with 345 seats
  • Conservatives didn’t last long as Bonar Law resigned through ill health
  • Stanley Baldwin became Prime Minister and decided another general election was needed
  • Baldwin decided Joseph Chamberlain’s tariff reform was right and decided to give the voters a chance to vote on the matter
  • Asquith temporarily reunited the Liberals and worked alongside Labour to argue that free trade and foreign imports would reduce the cost of living for the working class
  • Conservatives won 258, Labour 191 and Liberals 159
  • This was further confirmation that Labour had replaced the Liberals as opposition

Formation of Labour Government

  • When the election results were announced no one knew what would happen
  • Conservatives could not stay in office as although they were largest party they had lost majority
  • Both Labour and Liberals could vote against Conservative bill and reject legislation
  • Conservatives wanted a government of national unity with the Liberals
  • The Conservative leader Baldwin was happy for a Labour government to go ahead
  • He knew if the Labour government tried anything unacceptable then the Conservatives and Liberals could easily reject and vote Labour out
  • Asquith offered Liberal support for a Labour government
  • Baldwin encouraged him, as he knew this would outrage right wing Liberals like Winston Churchill and push them to join the Tories
  • James Ramsay MacDonald became first Labour Prime Minister

Problems facing Labour government

  • Both were minority government dependent on Liberal support
  • Had to pursue moderate policies and unable to introduce nationalisation and disarmament
  • Policies were little different to those of the Liberals
  • Had difficulty in projecting the party as a national party when had always been the party of the working class
  • Close ties to trade unions left business men, factory owners and people of land and property fearful of nationalisation and trade union action
  • Labour could not break ties with trade unions as needed funds
  • In return the unions expected to be able to control the party
  • Trade unions were critical of the ‘half-measures’ and lack of action undertaken by the Labour government and made no allowance for the need of Liberal support
  • Both government had difficult economic times
  • 1924 1 million unemployed
  • 1931 world economic crisis after Wall St. Crash
  • Met by fledgling party unable to find any solution other than nationalisation
  • This would have been rejected in the Commons
  • Left wing of party wanted to seek nationalisation if only to appeal to electorate in future election
  • Hoped could gain majority if appealed to working class
  • MacDonald believed would gain more support through initiating moderate policies rather than seeking a revolution of British politics

Successes of Labour Government

Social reforms

  • Wheatley’s housing act – provided £9 million a year for building council houses
  • 500,000 houses built over next 10 years as a result of scheme
  • Old Age Pensions and unemployment benefits were increased
  • Number of free places in grammar schools was increased and state scholarship to university was reintroduced
  • Sir Henry Hadow appointed to assess needs of education
  • Hadow Report important milestone in English education
  • Introduced break between primary and secondary education at 11
  • Recognised principle that whole population entitled to some secondary education
  • £28 million allocated to public work schemes
  • Taxes cut on basic foods such as tea, sugar, coffee and cocoa

Foreign affairs

  • MacDonald acted as Foreign secretary as well as Prime Minister
  • Felt it was essential to improve German and French relations, which had deteriorated greatly since the occupation of the Ruhr in 1923
  • MacDonald was largely responsible for the Dawes plan 1924
  • Solved the problem of the Ruhr
  • MacDonald gave full diplomatic recognition to the Soviet regime in Russia
  • Signed a trade treaty developing trade links

Franco-German relations

  • Solved problem of Franco-German relations for long time
  • French occupation of Ruhr produced inflation and collapsed currency
  • MacDonald invited Herriot (French PM) and Stresemann (German Foreign Minister) to a conference in London
  • Persuaded USA to attend as well – sent General Dawes as representative
  • He chaired proceedings for some of the time
  • No change in total reparations but Germany to pay what she could afford
  • Given loan of 800 million gold marks, mainly from USA
  • France assured of some reparations so evacuated troops from Ruhr
  • German economy recovered and international tension eased
  • MacDonald lucky – Poincare had fallen; Herriot (his successor) wanted reconciliation


  • Gave full diplomatic recognition to USSR and trade treaty
  • Began discussions regarding a Great British loan to Russia
  • Tories and Liberals opposed it

League of Nations

  • MacDonald made serious effort to make League work
  • Attended meetings in Geneva
  • Tried to strengthen it with Geneva Protocol
  • This would have made arbitration of international disputes compulsory
  • Labour fell before Protocol accepted
  • Incoming Conservative government refused to ratify it

Fall of Government

  • Campbell Case – editor of Workers’ weekly wrote article urging soldiers not to fire on fellow workers during strikes
  • Campbell arrested and charged with incitement to mutiny
  • Labour attorney-general withdrew prosecution
  • Conservatives and Liberals, already concerned with MacDonald relations with Russia, accused government of being sympathetic to communism
  • Liberals demanded an enquiry into the matter in the Commons and was passed 362 to 198
  • MacDonald saw this as a vote of no confidence and resigned
  • The following election was complicated by the Zinoviev letter
  • Appeared in Daily Mail 4 days before polling
  • Claimed to be from Russian Communist leader containing instructions on how to organise revolution
  • Caused huge controversy and was taken to show Labour sympathy towards Russia was encouraging communism in Britain
  • Labour dropped to 151 seats while the Liberals were finally finished as a major party with 40 seats
  • Conservatives won majority of 419

Significance of Labour Government

  • Gained experience of running nation
  • Gained credibility from people
  • Proved Labour capable of working as national leading party
  • Proved Labour could be in office without bringing about socialist revolution
  • Won respect both home and abroad through actions
  • Ended Liberals chances of returning to major party



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