4.5. Present-Day Britain

The economic policy of Great Britain in the 1990s was characterized by the strategy of economic regulation, which promoted the victory of the Conservatives in the general election in 1992. The cabinet headed by John Major continued the economic and social policies traditional for this party. This led to a fall of the Conservatives.

In 1997, Britain’s opposition Labour party routed the ruling Conservative party in the national election, and its leader Tony Blair replaced Major as head of the government. He became Britain’s youngest Prime Minister since 1812, ending 18 years of Tory rule since 1979. Blair repeated his success in the general election of 2002.

As Prime Minister Tony Blair presided over an optimistic first term in which Devolution brought self-governing powers to both Scotland and Wales, reversing control from London. The late 1990s and into the millennium saw an increased celebration of British culture in its myriad of aspects from the Queen's Golden Jubilee celebrations of 2002 to huge programmes of urban renewal of the long neglected industrial cities of the north, Manchester, Liverpool, Newcastle and Glasgow, making them the great cities of culture they are today.

On 27 June 2007, the new Prime Minister Gordon Brown replaced Blair. Brown is the first prime minister from a Scottish constituency since 1964. He is also one of only five prime ministers who attended a university other than Oxford or Cambridge. Brown has proposed moving some traditional prime ministerial powers to the realm of Parliament, such as the power to declare war and approve appointments to senior positions. He has also proposed moving some powers from Parliament to citizens, including the right to form "citizens' juries", easily petition Parliament for new laws, and rally outside Westminster.

Brown was committed to the Iraq War, but said in a speech in June 2007 that he would "learn the lessons" from the mistakes made in Iraq. Brown said in a letter published on 17 March 2008 that the United Kingdom will hold an inquiry into the Iraq war.

In a speech in July 2007, Brown personally clarified his position regarding Britain's relationship with the USA: "We will not allow people to separate us from the United States of America in dealing with the common challenges that we face around the world."

In the local elections on 1 May 2008, Labour suffered their worst results in 40 years. Gordon Brown was quoted in the press as having said that the results were "a painful defeat for Labour".

As for the domestic policies, the Labour government admitted that the recession had been deeper than predicted, but claimed that the government's action to pump money into the economy had made a "real difference" to families and businesses. Later the year of 2009, a number of measures to help economic recovery were announced, including a public sector pay freeze, a levy on bank bonuses and a package of measures to help the unemployed.

The country's leading economic think tank forecasts that with spending on health and education protected, the areas most likely to face severe cuts are defence, housing, transport and higher education. Moreover, it is estimated that the cost to each individual family of paying back the national debt will be £2,400 a year for eight years.