Public Expenditure 1870–1939 — Defence, Consolidated Fund, Trade, Industry and Transport, Common Administrative Services, Pensions, Transfers from Central to Local Government

There is plenty of evidence to testify to the growth of prosperity in the United Kingdom in this period, even if that prosperity was shared unequally between members of society and some people were only slightly touched by it. Contemporary estimates suggested that national income per head increased by over 50 per cent between 1880 and the Great War. The official government statistics show the growth of British GDP throughout the period from 1870 to 1939 as indicated in Figure 3.1 below which shows that GDP grew moderately between the 1870s and the Great War, but accelerated greatly during that major international conflict, before settling to a more moderate if fluctuating pattern of change in the 1920s, and embarking on a further period of expansion in the 1930s. Between the wars GDP oscillated between £4,000 million and a little over £5,000 million per year, again exhibiting a clear upward trend in the later 1930s as preparations were made in anticipation of another major international conflict and growth was influenced by inflation.