|The Rt Hon James Callaghan|
April 5, 1976 – May 4, 1979
|Preceded by||Harold Wilson|
|Succeeded by||Margaret Thatcher|
March 5, 1974 – April 5, 1976
|Prime Minister||Harold Wilson|
|Preceded by||Alec Douglas-Home|
|Succeeded by||Anthony Crosland|
May 12, 1972 – March 5, 1974
|Preceded by||Denis Healey|
|Succeeded by||Alec Douglas-Home|
June 19, 1970 – May 21, 1971
|Preceded by||Quintin Hogg|
|Succeeded by||Shirley Williams|
|Born||March 27, 1912
Portsmouth, Hampshire, UK
|Died||March 26 2005 (aged 92)
Ringmer, East Sussex, UK
Leonard James Callaghan, Baron Callaghan of Cardiff, KG, PC (March 27, 1912 – March 26, 2005), was the fourth British Labour Prime Minister from 1976 to 1979. Callaghan is the only person to have filled all four of the Great Offices of State: Prime Minister, Chancellor of the Exchequer, Home Secretary, and Foreign Secretary. He did not actually win an election, becoming Prime Minister when Harold Wilson retired. In 1979, Callaghan became the first Prime Minister to lose an election to a woman, Margaret Thatcher, whose Conservative party would govern Britain for the next eighteen years.
Callaghan was Chancellor of the Exchequer from 1964 to 1967 during a turbulent period in the British economy in which he had to wrestle with a balance of payments deficit and speculative attacks on the pound sterling. In November 1967, the Government was forced to devalue the pound sterling. Callaghan offered to resign, but was persuaded to swap his ministerial post with Roy Jenkins, becoming Home Secretary from 1967 to 1970. In that capacity, Callaghan took the decision to deploy the British Army to Northern Ireland, after a request from the Northern Ireland Government.
The Labour party lost the general election in 1970, but Callaghan returned to office as Foreign Secretary in March 1974, taking responsibility for renegotiating the terms of Britain's membership of the European Economic Community (the EEC, or "Common Market"), and supporting a "Yes" vote in the 1975 referendum for the UK to remain in the EEC. When Harold Wilson resigned in 1976, Callaghan was elected the new leader by Labour MPs. His one term as Prime Minister was a time of difficulty, because Labour did not hold a majority in the House of Commons, forcing Callaghan to deal with minor parties such as the Liberal Party and the Ulster Unionists, a process which included the Lib-Lab pact. Industrial disputes, large strikes and high unemployment in the "Winter of Discontent" of 1978–79 made Callaghan's government unpopular and the defeat of the referendum on devolution for Scotland led to the passage of a Motion of No Confidence on March 28, 1979.
Callaghan was born at 38 Funtington Road, Copnor, Portsmouth, Hampshire, England on March 27, 1912. He was named after his father. James Callaghan senior was a Royal Navy Chief Petty Officer of Roman Catholic Irish ancestry, who died when Callaghan was nine years old in 1921. His mother was called Charlotte. He attended Portsmouth Northern Secondary School (now Mayfield School). He gained the Senior Oxford Certificate in 1929 but could not afford entrance to university and instead sat the Civil Service Entrance Exam.
At the age of 17 he left to work as a clerk for the Inland Revenue. While working as a Tax Inspector, Callaghan was instrumental in establishing the Association of Officers of Taxes as a Trade Union for those in his profession and became a member of its National Executive. Whilst at the Inland Revenue offices in Kent, in 1931 he joined the Maidstone branch of Labour Party. In 1934, he was transferred to Inland offices in London. Following a merger of unions in 1937, Callaghan was appointed as a full-time union official and to the post of Assistant Secretary of the Inland Revenue Staff Federation and resigned from his civil service duties.
His union position at the Inland Revenue Federation brought Callaghan into contact with Harold Laski, the Chairman of the Labour Party's National Executive Committee and a respected academic at the London School of Economics. Laski encouraged him to stand for Parliament. Callaghan joined the Royal Navy Patrol Service in World War II from 1943, rising to the rank of Lieutenant. Whilst training for his promotion his medical examination revealed that he was suffering from tuberculosis and was admitted to Haslar hospital in Gosport near Portsmouth. After he recovered he was discharged and assigned to duties with the Admiralty in Whitehall. He was assigned to the Japanese section and wrote a service manual for the Royal Navy entitled "The Enemy Japan."
Whilst on leave, Callaghan was selected as a Parliamentary candidate for Cardiff South. He narrowly won the local party ballot with 12 votes against the next highest candidate George Thomas with 11 votes. He was encouraged to put his name forward for the Cardiff south seat by his friend Dai Kneath, a member of the IRSF National exectuive from Swansea, who was in turn an associate and friend of the local Labour Party secretary Bill Headon. During 1945, he was assigned to the Indian Fleet and was serving on HMS Elizabeth in the Indian Ocean. After VE day, along with other prospective candidates he returned to England to stand in the general election.
The sitting Conservative member for Cardiff South was Sir Arthur Evans, who was first elected in 1923, losing the seat to Labour in 1929 before regaining it in 1931. In the last general election before the formation of a coalition government following the outbreak of War, he scraped through with a 541 majority over Labour. The constituency had several working class areas including Adamsdown, the old Irish quarter as well as the dockland areas of Tiger Bay and Bute Town; as such the seat was seen as a winable prospect by the Labour Party campaign.
Labour won a landslide victory on July 26, 1945, bringing Clement Attlee to power. Callaghan won his Cardiff seat in the 1945 UK general election (and would hold a Cardiff-area seat continuously until 1987). He won with a stunning 6,000 majority over the conservative incumbent candidate Evans. In total he polled 17,489 voted to 11,545 for Evans. He campaigned on such issues as the rapid demobilization of the armed forces and for a new new housing construction program. At the time of his election, his son Michael was born.
Callaghan was soon appointed Parliamentary Secretary to the Ministry of Transport in 1947 where, advised by the young chief constable of Hertfordshire Sir Arthur Young, his term saw important improvements in road safety, notably the introduction of zebra crossings, and an extension in the use of cat's eyes. He moved to be Parliamentary and Financial Secretary to the Admiralty from 1950 where he was a delegate to the Council of Europe and resisted plans for a European army.
Callaghan was popular with Labour MPs and was elected to the Shadow Cabinet every year while the Labour Party was in opposition from 1951 to 1964. He was Parliamentary Adviser to the Police Federation from 1955 to 1960 when he negotiated an increase in police pay. He ran for the Deputy Leadership of the party in 1960 as an opponent of unilateral nuclear disarmament, and despite the other candidate of the Labour right (George Brown) agreeing with him on this policy, he forced Brown to a second vote. In 1961, Callaghan became shadow chancellor. When Hugh Gaitskell died in January 1963, Callaghan ran to succeed him but came third. In the difficult leadership election in 1963 it was too early for Callaghan to win though he did gain the support of right-wingers, such as Anthony Crosland, who wanted to prevent Wilson from being leader but who also didn't trust George Brown.
In October 1964 Conservative Prime Minister Sir Alec Douglas-Home called a general election It was a tough election but Labour won a small majority gaining 56 seats (a total of 317 to the Conservatives 309). The new Labour government under Harold Wilson immediately faced economic problems and Wilson acted within his first hours to appoint Callaghan as Chancellor of the Exchequer. The new government had to cope with a balance of payments deficit and speculative attacks on Sterling. It was the policy of the whole government, and one in which Callaghan concurred, that devaluation should be avoided for as long as possible and he managed to arrange loans from other central banks and some tax rises in order to stabilize the economy. Callaghan's time as chancellor was to be during a time of crisis; with high inflation, high unemployment and an unstable economy with a deficit in the budget, a deficit in the balance of import and exports and most importantly conflict over the value of the pound.
On November 11, Callaghan gave his first budget and announced increases in income tax, petrol tax and the introduction of a new Capital Gains Tax, actions which most economists deemed necessary to take the heat out of the balance and sterling deficit, though international bankers disagreed. Increasing difficulties with the economy were evident by late November when the surcharge of imports under the previous government were forcing the reserves to be depleted by as much as £50 million per day. On November 23, it was decided to increase the bank rate from 2 to 7 percent which generated a large amount of criticism. Handling the crisis was made more difficult by the attitude of Lord Cromer, the Governor of the Bank of England, who argued against the fiscal policies of the new Labour government. When Callaghan and Wilson threatened to call a new general election, the governor soon raised a £3 billion loan to stabilise the reserves and the deficit. His second budget came on the April 6, 1965, in which he announced efforts to deflate the economy and reduce home import demand by £250 million. Shortly after the bank rate was reduced from 7 percent down to 6 percent. For a brief time the economy and British financial market stabilized, allowing in June for Callaghan to visit the United States and to discuss the state of the British economy with President Lyndon Baines Johnson and the International Monetary Fund (IMF).
In July, the pound came under extreme pressure and Callaghan was forced to create harsh temporary measures to demonstrate control of the economy. These include suspending all current government building projects and postponing new pension plans. The alternative was to allow the pound to float or to devalue it. Callaghan and Wilson however were again adamant that a devaluation of the pound would create new social and economic problems and continued to take a firm stance against it. The government continued to struggle both with the economy and with the slender majority which by 1966 had been reduced to one. On February 28, Harold Wilson formally announced an election for the March 31, 1966. On the March 1, Callaghan gave a "little budget" to the commons and announced the historic decision that the UK would adopt the decimal system. (It was actually not until 1971, under a Tory government, that Britain ended the system of pounds, shillings and pence, and entered a decimal system of 100 pence to the pound.) He also announced a short term mortgage scheme which allowed low wage earners to maintain mortgage schemes in the face of economic difficulties. Soon after Labour won 363 seats compared to 252 seats against the Conservatives, giving the Labour government a large majority of 97.
Callaghan introduced his new Budget on May 4. He had informed the house that he would bring a full Budget to the House when he made his "little budget" speech prior to the election. The main point of his budget was the introduction of a selective Employment tax focusing on services rather than manufacturing. Twelve days after the budget the National Union of Seamen called a national strike and the problems facing Sterling were multiplied. Additional strikes caused the balance of payments deficit to increase and the 3.3 billion loan was now due. On July 14, the bank rate was increased again to 7 percent. On the July 20, Callaghan announced an emergency ten point program with a six month freeze on wage and salary increases. By 1967, the economy had begun to restabilise once again and the bank rate was reduced to 6 percent in March and 5.5 percent in May.
However, the economy was soon in turmoil again with the Middle East crisis between Egypt and Israel raising oil prices. Furthermore the economy was hit in mid-September when a national dock strike lasted for eight weeks. A run on Sterling began with the six day war and with the closure of the Suez Canal and with the dock strike, the balance of payments deficit grew to a critical level. A Common Market report suggested that the pound could not be sustained as a reserve currency and it was suggested again that the pound should be devalued. Wilson and Callaghan refused a contingency fund offered from the IMF because of several conditions attached, and on Wednesday, November 15, the historic decision was taken to commit the government to a 14.3 percent devaluation. The situation was a great poltiical controversy at the time. As Denis Healey in his autobiography, notes:
Nowadays exchange rates can swing to and fro continually by amount greater than that, without attracting much attention outside the City columns of the newspapers. It may be difficult to understand how great a political humiliation this devaluation appeared at the time—above all to Wilson and his Chancellor, Jim Callaghan, who felt he must resign over it. Callaghan's personal distress was increased by careless answer he gave to a backbencher's question two days before the formal devaluation, which cost Britain several hundred million pounds.
Callaghan immediately offered his resignation as Chancellor and increasing political opposition forced Wilson to accept it. Wilson then moved Roy Jenkins the home secretary to the Chancellor of the Exchequer and Callaghan became the new home secretary on November 30, 1967.
Callaghan's time as Home Secretary were marked considerably by the emerging conflict in Northern Ireland and with the declining state of the British economy. His background in the trade union movement led to his being a focus for opposition to the employment laws proposed by his cabinet colleague Barbara Castle in 1969. In this struggle (called The Battle of Downing Street) he ultimately prevailed, and the proposals (set out in the White paper In Place of Strife) were dropped. As a staunch defender of trade unions, he opposed efforts to reform them, earning the title "keeper of the cloth cap." Some within the party who disliked Wilson began to plot to destabilize him and have Callaghan take over at about this time. Callaghan also took the decision to deploy United Kingdom troops in Northern Ireland after a request from the Ulster Unionist Government of Northern Ireland.
He was responsible for the Immigration Act of 1968, a controversial piece of legislation prompted by Conservative assertions that an influx of Kenyan Asians would soon inundate the country. Rushed through the Commons in a week, it placed entry controls on holders of United Kingdom passports who had "no substantial connection" with Britain by setting up a voucher system. Also significant was the passing of the Race Relations Act in the same year, making it illegal to refuse employment, housing or education on the basis of ethnic background. The Act extended the powers of the Race Relations Board at the time, to deal with complaints of discrimination and unfair attitudes. It also set up a new supervisory body, the Community Relations Commission, to promote "harmonious community relations." Presenting the Bill to Parliament, the Home Secretary, Jim Callaghan, said, "The House has rarely faced an issue of greater social significance for our country and our children."
After Wilson's shock defeat by Edward Heath in the 1970 general election, Callaghan declined to challenge him for the leadership despite Wilson's vulnerability. This did much to rehabilitate him in Wilson's eyes. He was in charge of drawing up a new policy statement in 1972, which contained the idea of the 'Social Contract' between the Government and Trade Unions. He also did much to ensure that Labour opposed the Heath government's bid to enter the Common Market—forcing Wilson's hand by making his personal opposition clear without consulting the Party Leader.
He held the post of Home Secretary, until the defeat of the Labour government in the 1970 General Election, when became the shadow Foreign secretary.
When Wilson was again appointed Prime Minister in March 1974, he appointed Callaghan as Foreign Secretary which gave him responsibility for renegotiating the terms of Britain's membership of the Common Market. When the talks concluded, Callaghan led the Cabinet in declaring the new terms acceptable and he supported a Yes vote in the 1975 referendum.
During his second term Harold Wilson announced his surprise resignation on March 16, 1976, and unofficially endorsed Callaghan as his successor. Callaghan was the favourite to win the leadership, although he was the oldest candidate, he was also the most experienced and least divisive. Popularity with all parts of the Labour movement saw him through the ballot of Labour MPs to win the leadership vote. On the April 5, 1976, at the age of 64 years and 9 days Callaghan became Prime Minister (the oldest person to become Prime Minister at time of appointment since Winston Churchill).
Callaghan was the first Prime Minister to have held all three leading Cabinet positions—Chancellor of the Exchequer, Home Secretary and Foreign Secretary—prior to becoming Prime Minister.
Callaghan's support for and from the union movement should not be mistaken for a left wing position: Unlike Wilson, Callaghan had been a supporter of Hugh Gaitskell in the battles over Labour's direction in the 1950s and he settled old scores by sacking the Bevanite Barbara Castle when he became party leader. He also, however, didn't offer a cabinet post to Edward Short who, like Callaghan, was on the right of the party. Short continued as deputy leader until he was given a peerage in January 1977.
Callaghan did, though, continue Wilson's policy of a balanced Cabinet and relied heavily on the man he defeated for the job of party leader—the arch-Bevanite Michael Foot. Foot was made Leader of the House of Commons and given the task of steering through the government's legislative program. As Labour soon lost its majority in a string of poor showings in by-elections, this required all of Callaghan and Foot's blend of charisma and steely determination. Though they clashed in the Commons, Callaghan also enjoyed very good personal relations with Iain Macleod when Macleod was Shadow Chancellor in the 1960s.
In May 1977, Callaghan was involved in controversy and accusations of nepotism. His son-in-law, a noted journalist Peter Jay, but with no particular background in diplomacy was appointed UK Ambassador to the United States. The Callaghan government also decided to sell Harrier fighter planes despite Soviet threats. U.S. President Jimmy Carter and Callaghan were on very good terms and pledged to the Soviet Union that the U.S. would not sell military equipment to the Chinese. He however would not stand in the way of other Western nations making arms deals.
His time as Prime Minister was dominated by the troubles in running a Government with a minority in the House of Commons. Callaghan was forced to make deals with minor parties in order to survive, including the Lib-Lab pact. He had been forced to accept referendums on devolution in Scotland and Wales (the first went in favor but did not reach the required majority, and the second went heavily against). However, by the autumn of 1978 most opinion polls were showing Labour ahead and he was expected to call an election. His decision not to has been described as the biggest mistake of his premiership.
Famously he strung along the opposition and was expected to make his declaration of election in a broadcast in early September 1978. His decision to go on was at the time seen by many as a sign of his domination of the political scene and he ridiculed his opponents by impersonating old-time music hall star Marie Lloyd singing Waiting at the Church at that month's Trades Union Congress meeting: Now seen as one of the greatest moments of hubris in modern British politics but celebrated at the time. Callaghan intended to convey the message that he had not promised an election, but most observers misread his message as an assertion that he would call an election, and the Conservatives would not be ready for it.
Callaghan's way of dealing with the long-term economic difficulties involved pay restraint which had been operating for four years with reasonable success. He gambled that a fifth year would further improve the economy and allow him to be re-elected in 1979, and so attempted to hold pay rises to 5 percent or less. The Trade Unions rejected continued pay restraint and in a succession of strikes over the winter of 1978/79 (known as the Winter of Discontent) secured higher pay. The industrial unrest made his government extremely unpopular, and Callaghan's response to one interview question only made it worse. Returning to the United Kingdom from an economic summit held in Guadeloupe in early 1979, Callaghan was asked, "What is your general approach, in view of the mounting chaos in the country at the moment?"
Callaghan replied: "Well, that's a judgment that you are making. I promise you that if you look at it from outside, and perhaps you're taking rather a parochial view at the moment, I don't think that other people in the world would share the view that there is mounting chaos."
This reply was reported in The Sun under the headline: Crisis? What Crisis?
Callaghan was forced to advise The Queen to call an election when the House of Commons passed a Motion of No Confidence by one vote on March 28, 1979. The Conservatives, with advertising consultants Saatchi and Saatchi, ran a campaign on the slogan "Labour isn't working." As expected, Margaret Thatcher won the election.
Callaghan resigned as leader of the Labour Party in September 1980, shortly after the 1980 party conference had voted for a new system of election by electoral college involving the individual members and trade unions. His resignation ensured that his successor would be elected by MPs only. In the second round of a campaign that laid bare the deep internal divisions of the Parliamentary Labour Party, Michael Foot beat Denis Healey to succeed Callaghan as leader.
In 1983, Callaghan became Father of the House as the longest continuously serving member of the Commons and one of only two survivors of the 1945 general election. (Michael Foot was the other but he had been out of the House from 1955 to 1960.) In 1987, he was made a Knight of the Garter and stood down at the 1987 general election after forty-two years as a member of the Commons. Shortly afterward, he was elevated to the House of Lords as Baron Callaghan of Cardiff, of the City of Cardiff in the Royal County of South Glamorganshire.
In 1988, Callaghan's wife Audrey, a former chairman (1969-1982) of Great Ormond Street Hospital, spotted a letter to a newspaper which pointed out that the copyright of Peter Pan, which had been assigned by J. M. Barrie to the hospital, was about to expire. Callaghan moved an amendment to the Copyright Bill then under consideration in the Lords to extend it permanently (which is permissible in the UK) and this was accepted by the government.
On February 14, 2005, he became the longest-lived British Prime Minister, surpassing Harold Macmillan, and had the longest life of any British prime minister when he died at his farm in Ringmer, East Sussex on March 26, 2005, on the eve of his 93rd birthday. At the time of his death Callaghan had lived 92 years 364 days, exceeding by 42 days the life span of Macmillan.
James Callaghan's interests included rugby, tennis, and agriculture. According to the official history of 10 Downing Street, he is believed to have been the tallest prime minister in British history at 6 ft 1in (185 cm). He married Audrey Elizabeth Moulton, whom he had met when they both worked as Sunday School teachers at the local Baptist church, in July 1938, and had three children—one son and two daughters. Lady Callaghan died on March 15, 2005, only 11 days before James Callaghan's death on the March 26.
One of their daughters, Margaret became Baroness Jay of Paddington and was Leader of the House of Lords from 1998 to 2001.
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