Clause IV

Clause IV (also Clause Four) historically refers to part of the 1918 text of the UK Labour Party constitution which set out the aims and values of the party. Before its revision in 1995, its application was the subject of considerable dispute.

The original version of Clause IV, drafted by Sidney Webb in November 1917 and adopted by the party in 1918, read, in part 4:

To secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry or service.

This section was widely seen as the Labour Party's commitment to socialism, even though it is not explicitly mentioned (it is, however, implied by the phrase "common ownership of the means of production, distribution and exchange"). The Manchester Guardian heralded it as showing "the Birth of a Socialist Party", stating that:

The changes of machinery are not revolutionary, but they are significant. There is now for the first time embodied in the constitution of the party a declaration of political principles, and these principles are definitely Socialistic. ... In other words, the Labour party becomes a Socialist party (the decisive phrase is "the common ownership of the means of production") ... Platonic resolutions have been passed before now, both by the Labour party and by the Trade Unions Congress in favour of the Socialistic organisation of society, but they are now for the first time made an integral part of the party constitution.

In 1918, nationalisation was seen by many voters as akin to modernisation – the nationalisation of the railways was a widely supported policy, for instance, as it would reduce the plethora of uncoordinated and competing companies. This text is usually assumed to involve nationalisation of the whole economy but close reading of the text shows that there are many other possible interpretations. Common ownership, though later given a technical meaning by the 1976 Industrial Common Ownership Act, could mean municipal ownership, worker cooperatives or consumer cooperatives.

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