Britain: The Quiet Revolution

SHORTLY after the Tories' upset victory last June, Edward ("Ted") Heath invited a few colleagues in for tea at 10 Downing Street. When someone remarked the new Prime Minister's Steinway had already been installed in the drawing room, Heath sat down at the keyboard and began to play. After he had completed an entire Beethoven sonata, he stood up. "I'm sorry," he said, "but, gentlemen, when I start something, I always finish it."

During his first four months in office, many Britons wondered whether the Prime Minister would ever start anything. He seemed to spend so much of his time sailing his yacht, Morning Cloud, that a cartoonist showed him asking a bobby the way to No. 10. The

Economist scolded: "It requires some effort of will to remember that not only has there been a change of government, but that there is an active government at all." Last week, however, as the new Parliament convened for its fall term, the Prime Minister finally began to make good on his promise to undertake "revolution so quiet and yet so total" that it will set the pattern for British development for the next 20 years.

Cutting Welfare. That is almost certainly an unattainable and in some respects undesirable goal. Heath is seeking to reverse or at least to redirect the trend of British life established by the Labor Party and its extensive welfare measures. The beginnings of Heath's quiet revolution were outlined in a budget that Chancellor of the Exchequer Anthony Barber presented to a packed House of Commons last week. The budget's basic aim is to reduce government spending and the scope of government activity while encouraging individual citizens and private enterprise to do more for themselves. The initial step was Britain's first tax cut in eleven years. Corporate income levies will be reduced from 45% to 42.5% next January, and personal income taxes will be cut 2 1/2% in April. The reduction will place an estimated extra $972 million in private hands next year.

To offset the tax reductions. Heath's government is pruning the welfare state in an even more thorough manner than did Winston Churchill when he returned to power in 1951 after six years of Labor rule. The new budget eliminates funds for the nationalization of the ports, halts grants for industry and the building of tourist hotels and will begin phasing out aid for London commuter rail lines. "Our object," explained Barber, "is to widen the area within which industry rather than government will take decisions."

No More Milk. Of greatest interest to the average Briton is a slash in social services. There will be no more free milk to schoolchildren above age seven. Subsidies for school lunches and for milk for families on welfare will also end. Prescription charges will increase from 30-c- to 48-c-. Patients who now pay only a flat $4.20 fee for any amount of dental treatment will be charged half of actual cost. Not wanting to seem entirely heartless, the Tories proposed a family income supplements bill that provides $1,872 a year for poor families with one child. That bill could move Britain toward an eventual guaranteed annual income.

Reflecting the Heath government's determination to bring Britain into the Common Market, Barber said that the country will abandon its old system of no tariffs on foodstuffs but high subsidies for British farmers. The high-tariff approach, patterned after the Continental system, will increase the income of British farmers and thereby reduce the need for government subsidies. But it will also boost food prices by as much as 25% in five years.

East of Suez. Heath is also seeking to reform two of Britain's most archaic institutions--its antiquated union-management relations and the overly compartmentalized national government. The Tories are determined to use their 30-seat majority in Commons to pass Britain's first comprehensive industrial relations law in modern times. The main purpose of the legislation is to curb the strikes that now plague British industry (3,021 work stoppages last year) and to enable employers to revamp the outmoded work rules that contribute to Britain's extremely low productivity. To establish what his aides describe as "larger clusters of responsibility," he has proposed reshuffling the entire central government, doing away with six ministries and creating two superdepartments for environment and industry.

In foreign policy, Heath is attempting to assert a stronger British voice. Despite angry outcries and threats of resignation from black nations in the Commonwealth, the Tories remain committed to their longstanding promise to sell ships and other military items to South Africa's racist government. Heath contends that Britain needs the use of South African ports to counter the growing Soviet naval presence in the Indian Ocean.

Reversing Labor's plan to withdraw all British forces from east of Suez except for a token force in Hong Kong, Heath intends to contribute an infantry battalion, five frigates, helicopters and naval patrol aircraft to the five-nation Asian defense organization (Singapore, Malaysia, Australia, New Zealand and Britain). Heath also pledged to increase Britain's military commitment to NATO.

Economic Dilemma. George Thomson, a Labor defense expert, called Heath's east-of-Suez plans "window dressing--and really dangerous window dressing, accepting implied commitments without either the capacity or the manpower." Even many Tories feel that the advantage of arms sales to South Africa will be more than offset by the possibility of antagonizing black Africans.

The chief criticisms center on Heath's domestic program. Former Chancellor of the Exchequer Roy Jenkins castigated the budget for its "petty dogmatism and shortsighted materialism." He has a point, for Heath's budget is likely to prove of chief benefit to the higher-income Briton, who will save more from tax cuts than he will lose from increased social service charges. Vic Feather, general secretary of Britain's powerful Trades Union Congress, blasted Heath's labor-reform bill as "unfair, unreasonable and unworkable."

The British public, which is fed up with the present wave of strikes--particularly a walkout of sanitation employees--generally supports Heath's get-tough policies with the unions. But Britons in the lower income brackets are certain to be furious with Heath when his welfare cuts begin to hurt them.

Immediate Problems. Some critics maintain that Heath is moving in the wrong direction altogether. Britain is gripped by its worst wage-price inflation in two decades. In the past ten months, prices have risen 6% and wages 12%. However, productivity has increased less than 2% in the last year, weakening Britain's competitive position in the world market. The new tax cuts may increase inflationary pressures by placing more spending power in private hands and by increasing food prices. The danger for Heath is that he will become bogged down in immediate economic problems before he can execute his grand plan to free British initiative and turn the country once more into a competitive economic power.

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