The timing and content of government policies to assist the depressed areas, 1920-1939

This thesis is concerned with examining why, in a period of high regional unemployment differentials, the development of an industrial location policy took so long to evolve during the interwar period. The thesis is divided into four parts, largely on a chronological basis. Part One serves as an introduction and an outline of the main trends in unemployment between 1920 and 1932.

Part Two contains a discussion of policies in the same period. It is suggested that Governments concentrated on measures to restore prosperity to the export industries in the hope that unemployment in the depressed coalfield areas would be reduced by a revival of these industries. The desire to lower costs to regain international competitiveness effectively thwarted the development of expansionary policies. At the same time, the need to placate public opinion led to a growth of ad. hoc policies to ease the burdens of regional unemployment, but to leave the export industry policies uncompromised. The most notable was Industrial Transference.

The slump of the thirties halted the growth of regional policies, but when the recovery began to accelerate in the prosperous areas and unemployment differentials widened, unemployment returned to the limelight as the problem of long-term unemployment was exposed. In Part Three, the development of regional policies up to the outbreak of War is discussed. After a series of articles in The Times depicting the social and economic problems of the ' derelict' areas had focused public attention on the coalfields again, the Government was forced to introduce regionally-0 $)& 3 /(%.&5 legislation, the Special Areas Act, 1934. This Act amounted to little more than a continuation of the ad hoc programme of the twenties, hut Commissioners were established and exhorted to develop new measures to help the unemployed. The Commissioners saw industrial diversification as the only effective policy, but their powers were restrictive in this field. However, armed with the recommendations of the Commissioners, the critics pressed for a more interventionist approach. The Government made a series of strategic concessions, culminating in the Special Areas (Amend­ment) Act, 1937» which empowered the Commissioners to give inducements to private industry to locate in the Areas. By 1939» the essential elements of modern regional policy, except demand management, were in operation.

Part Pour assesses the extent of progress made in regional policy during the interwar period. The role of regional policy was examined by the Barlow Commission which advocated a more economic, growth-oriented approach. Owing to the outbreak of war and fears of a recurrence of unemployment in the depressed areas after 1945* the Barlow recommendations were not fully implemented in 1945* Although progress in policy development had been impressive, little direct reduction in unemployment rates occurred in the interwar period. However, methodological and statistical problems make accurate calculations impossible.

In the circumstances, however, it is concluded that the Government did all that might reasonably have been expected of it to reduce regional unemployment.