POLITICS

Referendum Revisited Part 3: Wilson Promises An Historic Vote

14/08/2015 11:29 BST | Updated 08/02/2016 15:59 GMT

tom watson mp

The Huffington Post UK looks back on the UK’s first ever referendum, and what lessons can be learned by those in the two sides of the upcoming campaign.

Referendum Revisited Part 1: The French Keep Saying ‘Non'

Referendum Revisited Part 2: Labour Begins To Fall Apart

READ: Referendum Revisited Part 4: Tony Benn and Enoch Powell Join Together For Failure

After the shock result of the 1970 General Election, the 1974 vote had a lot to live up to.

Battered by the unions, Tory Prime Minister Ted Heath framed the election in the terms of ‘Who Governs Britain?’ in a bid to get a popular mandate for clamping down on persistent strikes.

The question might have been clear, but the answer wasn’t. Labour won four more seats than the Tories in the February 28th vote, but were 17 seats short of majority.

Labour leader Harold Wilson re-entered Downing Street as the head of a minority government, and almost immediately began work on a “fundamental renegotiation” of Britain’s entry terms to the Common Market.

Despite being back in Government, Wilson was still facing a potential split in his party over the European issue. Who better therefore to lead the renegotiation than James Callaghan – the man who had said “Non, merci beaucoup!” to the French three years earlier?

By getting a Eurosceptic to negotiate, Wilson could appease those anti-Europeans in his party. By undertaking the negotiations instead of withdrawing, he could also count on support from the pro-Europeans like Roy Jenkins.

On April 1, Callaghan went to the Council of Ministers to begin the renegotiation, and by June 4, discussions had begun on earnest.

There were four key areas which Britain wanted changed:

1) A reduction in Britain’s budgetary contribution,

2) Access for Commonwealth produce into the Common Market

3) Common Agricultural Policy reform

4) Right of member states to give state aid to industry and regions without Community interference.

The negotiations were temporarily paused when Wilson called the second General Election of the year, to be held on October 10. This time, Labour went even further in its manifesto, committing to holding a referendum “within 12 months”.

“We will give the British people the final say, which will be binding on the Government - through the ballot box - on whether we accept the terms and stay in or reject the terms and come out.”

It would be the first national referendum every held in the UK.

“I was amazed,” said Ken Clarke. “We have a parliamentary democracy.”

He added: “Harold Wilson called it for party management reasons. He probably was in favour of membership but tried at every turn to keep his party together. He came up with this idea of getting them all to agree a referendum. It was Harold Wilson coping with very difficult problems in his party.”

harold wilson callaghan 1975

Labour won the October election, securing a majority of just three. Now Wilson had to get on with the renegotiation, and the clock was ticking.

Less than eight weeks after the election win, German Chancellor Helmut Schmidt addressed the Labour Party conference in London.

Schmidt, leader of German’s Social Democrat Party, appealed to Labour member’s belief in international socialism and cooperation as a reason to stay in.

According to Callaghan: A Life by Kenneth O Morgan, Schmidt privately managed to get both Wilson and Callaghan to agree to recommending Brits voted ‘Yes’ in the referendum if negotiations on Budget contributions were successful.

Even one of the most vocal Labour eurosceptics, James Callaghan, was now on the side of Britain staying in the Common Market.

But while Callaghan had turned, others in the Labour Cabinet were sticking to their guns.

A furious row broke out at a Cabinet meeting on December 12, with Tony Benn, Michael Foot and Barbara Castle not holding back with their concerns over a loss or parliamentary sovereignty.

At this point, the Government was supposed to be of the position that it was working towards a successful renegotiation, but on December 31st 1974 Benn effectively broke from the line and told his constituents he was opposed to membership of the EEC.

The new year brought Wilson no respite from the squabbles, but it did bring clarity over the renegotiations.

At a make-or-break meeting in Dublin from March 10 to 12, agreement was reached on the four key issues.

There was an agreement on dairy products from the Commonwealth, and a change in the formula which decided Britain’s budget contribution. Wilson and Callaghan had not managed to secure all they had set out in Labour’s February 1974 – which included “no harmonisation of VAT” – but the pair hoped it would be enough for their Cabinet collegues.

Shirley Williams was impressed by the deal. She said: “Jim was quite a nationalist really in a low key way and so he was sent off to represent Britain, and he managed to in particular to get substantial concessions not for us, but for the Commonwealth, particularly for New Zealand which was very insistent and very aggressive for things like New Zealand butter and cheese and stuff.

“So there were quite a lot of concessions mostly about imported food from the Commonwealth, some of them about imported goods from the Commonwealth like timber that played a large part. But it enabled him to say we have protected the Commonwealth, and the Commonwealth said ‘thank you’ and they were on the whole, generally speaking, rather in favour. Almost all the major Commonwealth countries, particularly India, were very much in favour of us joining and didn’t see it in conflict but saw it as complimentary which was quite a coup for Callaghan.

“It was nice to be able to say that. It also undermined people like Enoch Powell who was going on about the white race and stuff like that. Mind you race was not as big a factor then as it later became. All of that benefitted and when Harold presented Jim’s conclusions as rather larger than they were – they weren’t completely trivial, from the point of view of the Commonwealth they were actually very important, but they certainly weren’t huge, and what they didn’t do, unlike our foolish prime minister is trying to do now, they weren’t about undermining the very sort of core gut of what was the European Union.”

Wilson took the deal back to his Cabinet, hoping for an outbreak of unity, but he was unsuccessful. After a two-day discussion, 16 Cabinet ministers voted in favour of Britain staying in the EEC, while seven voted to leave: Benn, Foot, Castle, Peter Shore, John Silken, Willie Ross and Eric Varley.

With Benn already having shown he would not toe the party line, Wilson risked a mass resignation from his Cabinet if he tried to force the doctrine of collective responsibility.

But if he allowed his Cabinet to go their separate ways and campaign against each other, would the Labour Party split for good?

What happened next sowed the seeds for 18 years of opposition, a split which led to the creation of the Lib Dems and the beginnings of tensions seen in today’s leadership crisis.

READ: Referendum Revisited Part 4: Tony Benn and Enoch Powell Join Together For Failure