ABSTRACT
In May 1979 there was a General Election which returned a Conservative administration led by Mrs Thatcher. 1 The nature of the impact of changes in government on monetary policy is controversial. Some have argued that official domination of policy-making is so pervasive that it does not matter who occupies Numbers 10 and 11 Downing Street, nor to which party they belong. Such views are at best overstated and usually misleading. During the period covered by this book, all three chancellors and all four premiers had a major impact on monetary policy. Furthermore, the change to a Labour government in 1974 coincided with the introduction of the ‘new approach’. By May 1979, the continued desirability of this system of control was very much in doubt. The new government both inspired and was associated with the consequent reappraisal of the techniques of monetary control. Moreover, the new government was avowedly ‘monetarist’ and proclaimed that monetary policy would be its major tool of policy.
