The Labour party and social policy 1900-1914: The case of national insurance

Abstract

Political parties frequently refer to their roots in an attempt to demonstrate a sense of continuity within which the policies of today are the latest stage in a long and evolving process born in a glorious past. A prime example of this was provided by literature published in celebration of the centenary in 2000 of the Labour Party. The picture evoked is one of Keir Hardie leading a dedicated group of early socialists in forming the party in 1900 before going on to a successful campaign for social welfare reform, a picture challenged by a number of historians.
Other historians have perpetuated the simplistic interpretation having given little attention to the first six years (1900-06) during which the new party was known as the Labour Representation Committee (LRC), or to the fact that Hardie and those associated with him became increasingly isolated. Many published works focus on the National Insurance Act of 1911 which was the culmination of a series of reforms initiated by the 'New' Liberals of 1906-14 but not all make clear that the passive support given to it by the Labour Party leadership led to the rejection of the leadership at successive party conferences and to widespread agitation and unrest by those who felt that they had no democratic political outlet for their concerns.
This thesis has two aims. The first is to deepen our appreciation of the true origins of the Labour Party and of the way it responded to the significant social welfare reforms of the Liberal government. The second aim is to establish how it was that one man, the largely unknown Ramsay MacDonald, became all-powerful within the group. It is hoped that an analysis of these two issues will help us to better understand the origins and nature of current debates over socialism and social welfare.
The potential impact of the range of factors and interests that are traditionally seen to be present within the policy making process are assessed. Particular emphasis is placed on information derived from the significant amount of original material relating both to the LRC and MacDonald himself, which suggests that the Labour Party of 1900-14 represented an uneasy
compromise between socialist and the older trade unions who supported reform only in so far as it enhanced their ability to administer its outcome.
The thesis concludes that Ramsay MacDonald took the opportunity to take control of, and shape, a new political party. In electoral terms he was successful but a high price was paid in terms of lost independence and unity of purpose. When war intervened the Labour Party was divided and the rejection of the leadership by the membership reflected more than hostility to the stance adopted during the National Insurance negotiations.