Hugh Gaitskell - Chancellor of The Exchequer, 1950-51

Chancellor of The Exchequer, 1950-51

In October 1950, Stafford Cripps was forced to resign as Chancellor of the Exchequer due to failing health, and Gaitskell was appointed to succeed him. His time as Chancellor was dominated by the struggle to finance Britain's part in the Korean War which put enormous strain on public finances. The cost of the war meant that savings had to be found from other budgets, and a controversial decision was made to introduce charges for prescription glasses and dentures on the National Health Service. At the same time, however, taxation on profits was raised and pensions increased to compensate retirees for a rise in the cost of living, while the allowances for dependent children payable to widows, the unemployed, and the sick, together with marriage and child allowances, were also increased. In addition, the amount of earnings allowed without affecting the pension was increased from 20 shillings to 40 shillings a week.

The budget caused a split in the government and caused him to fall out with Aneurin Bevan who resigned over this issue, seeing the prescription charges as a blow to the principle of a free health service. Bevan was later joined by Harold Wilson and John Freeman who also resigned. Later that year, Labour lost power to the Conservatives in the 1951 election.