Summary and Conclusion

The long historical period from 1870 until 2005 witnessed the transformation of the public sector as the economy of the United Kingdom embarked on a period of considerable growth. During that time the importance of the public sector increased from about 10 per cent of Gross Domestic Product (GDP) in the 1870s and 1880s to reach 30 per cent by the 1930s and over 40 per cent by the late 1960s. It was subsequently cut back to under 40 per cent in the 1980s by a radical Conservative government, and the Conservatives managed to reduce Total Net Public Expenditure to below 35 per cent by the late 1990s, before a new Labour government restored it to over 40 per cent in the early years of the present century. It is quite clear that these changes in the scale and scope of the public sector did not occur as a smooth progression but rather erratically in several stages. Furthermore, there has never been a consensus view in the United Kingdom as to how large and extensive should be the powers and responsibilities of the public sector. Instead, there has been a constant dispute between those on the political right, who have always been less than enthusiastic about the public sector, and those on the political left who have strongly advocated and supported it.