Prime Minister James Callaghan won a major battle in his struggle with Britian's inflation today when union leaders voted almost 2 to 1 against seeking immediate pay increases.
The decision kept in force the unions' agreement to wait 12 months between pay settlements.
Whether this is merely a paper triumph, however, will not be known until the union chiefs take their decision back to the rank-and-file for approval. Many British workers, who have endured three years of declining living standards, are demanding big wage gains now.
Today's decision was made at Blackpool, a working-class resort where the Trades Union Congress - Britian's AFL-CIO - is holding its annual meeting.
Union leaders representing 7.15 million members voted to continue the "12-month gap between pay settlements. Leaders representing 4.11 million workers voted to remove this restraint on free bargaining.
For the last two years, the unions have accepted and enforced deals that limited wage gains first to 10 per cent and then to about 5 per cent. There was no chance that they would renew this fixed limit, however, and Callaghan himself pleaded yesterday for "moderate" gains. The government defines "moderation" partly as willingness to wait 12 months before renegotiating pay agreements.
The one-sidedness of the Blackpool decision was deceptive because each union casts a single bloc vote. One of the biggest blocs - nearly 1.2 million workers - was delivered by Hugh Scanlon of the Engineering Workers' Union. His own delegation wanted him to vote against the government, but Scanlon refused.
When an Engineering Workers official tried to denounce scanlon from the rostrum, Marie Patterson, who was presiding, cut off his microphone.
Scanlon acknowledged that his endorsement of the 12-month rule would be hard to enforce.
"We will have dissent, acrimony, anger . . .understandable anger," he said.
There was irony in Scanlon's stance. He and Jack Jones, head of the big Transport and General Workers' Union, were once the militant leftist "terrible twins" of the labor movement. Both in fact have been the main support of the government's wage-restraint policy, although Jones today was forced by his membership to vote against delay in seeing higher pay. Callaghan has all but promised to stimulate the economy this fall, probably through tax cuts. At the moment, Britain's economy looks more promising than it has in years. The balance of payments is shifting in Britain's favor because of North Sea oil. Reserves of foreign currency pile up to record levels each month as the Bank of England works at an unusual task - keeping the price of the pound from rising, rather than falling. Inflation is still at an awesome level, but price indicators suggest that it is lessening.
The darkest cloud is unemployment about 1.4 million, and this was a source of concern at Bloskpool today.
Several of the union chiefs blamed recent violence in London and Birmingham and the growing strength of extremist parties on unemployment. Callaghan's economic stimulus would be aimed at increasing jobs.
If Britain stimulates its economy, it will join nearly every major country with which the United States trades. In France, President Valery Giscard d'Estaing has announced that his government plans an unusual budget deficit of $1.8 billion in the coming year. The Japanese are planning a $7.5 billion stimulus. In West Germany, Chancellor Helmut Schmidt has indicated that something similar is on the way.
If all four nations act, world trade should increase, expanding exports and adding jobs in the United States and elsewhere. Governments are cautions, however, the last time all the major industrial nations applied economic stimuli at the same time, in 1972-1973, their actions contributed to a devastating inflation from which the world has not yet recovered.