1. Privatisation Paper 1: Key Question: What impact did Thatcher’s government (1979 – 90) have on Britain 1979 – 97?

2. Nationalised Industry 1979 - 1982 Thatcher was very suspicious of state-run industries. She believed private run industries were more efficient, than state run industries, because they have make profit. She believed the states money shouldn’t be used to keep failing industries buoyant in the long term. To try and reduce government spending on nationalised industries she appointed Sir Keith Joseph, a fellow supporter of the free markets, as secretary of state for the industry in 1979.

3. Nationalised Industry 1979 - 1982 Joseph allowed some of the National Industries to decline. (e.g. He allowed the government to no longer support the British Steel-Making Industry to decline as it was losing money. Therefore the British Steel made 53,000 workers redundant in 1979. This policy did lead to further government pay-outs to the steel industry to finance the redundancy settlements. Between 1979 to 1981 Joseph authorised over £1 billion in pay-outs to the British Steel. More than labour had paid out in last years of the 1970s. Even after the redundancies the Steel Industry was still making a loss of over £450 million by 1981).

4. Nationalised Industry 1979 - 1982 Joseph also invested £990 million of government money in the loss-making car manufacturer British Leyland. (Joseph was only willing to invest government money if it meant a guarantee of job losses, 300,000 workers were laid off in 1981). In spite of these set backs the vision was clear: Thatcher wanted to end the government subsidies for national industries. Therefore timetables were set for the were set for industries to become more efficient and to make money. In all cases this meant layoff large numbers of workers to cut wage bills.

5. Supply side economics 1982- 87 Thatcher’s economic policy shifted at the end of the of 1982. Ministers admitted that it was possible to measure the money supply and therefore monetarism was largely abandoned. As inflation was back in single figures Thatcher believed that the policy had done it’s job. From 1982 to 1983 Thatcher embraced a free market policy know as ‘supply side economics’. The policy was designed to stimulate production in the private sector, included tax cuts and privatisation.

6. Tax Cuts and Breaking Even Create a spider diagram on Tax Cuts and Breaking Even.

7. Impact of Privatisation Watch the clip and make notes on the impact of privatisation. Complete the Historical interpretation: the significance of Privatisation (page 175).