OCR Specification focus:
‘Walpole 1721–1745; South Sea Bubble and financial policies; parliamentary management and patronage; relations with George I & II and Queen Caroline.’
The career of Robert Walpole, often regarded as Britain’s first ‘prime minister’, provides a central case study of early eighteenth-century political stability, financial innovation, and the evolution of parliamentary government.
Walpole’s Rise and Context
The collapse of the South Sea Bubble in 1720 created financial panic and widespread political fallout.
Line chart of the South Sea Company share price (1719–1720) showing a steep mid-1720 rise followed by a sharp crash. The clean layout helps students see the speculative peak and the sudden loss of confidence at a glance. Axes show dates and price scale with minimal annotation. Source
The South Sea Company had promised vast profits from trade in South America, but speculative investment inflated share prices to unsustainable levels. When the bubble burst, many investors were ruined, and confidence in government was shaken. Walpole, already experienced in financial administration, emerged as the figure best placed to restore stability. By 1721 he was recognised as First Lord of the Treasury and Chancellor of the Exchequer, roles that made him de facto chief minister until 1742.
South Sea Bubble: A speculative financial crisis of 1720 in which the South Sea Company’s share prices collapsed after artificial inflation, causing widespread economic and political disruption.
Walpole and the South Sea Bubble
Walpole’s handling of the crisis demonstrated his skill in financial management and political manoeuvre.
He restored confidence by negotiating partial restitution for investors.
He protected the monarchy and government from blame, ensuring loyalty to the Hanoverian regime.
He reduced national hostility towards the financial system by easing terms for smaller shareholders.
Walpole’s reputation as a trustworthy steward of the economy enabled him to consolidate his political authority in the 1720s.
Financial Policies and Economic Stability
Between 1721 and 1745, Walpole introduced several measures aimed at strengthening Britain’s fiscal position:
Reduction of the Land Tax from 4 shillings to 2 shillings in the pound, easing burdens on landowning elites.
Excise schemes to shift taxation from land to consumption, notably the controversial Excise Bill of 1733, which faced fierce opposition and was abandoned.
Use of the sinking fund mechanism to reduce the National Debt, prioritising long-term financial credibility.
Encouragement of commercial growth, trade expansion, and colonial enterprise to secure customs revenue.
Sinking Fund: A government account established to reduce national debt gradually through surplus revenue payments, symbolising fiscal responsibility and financial credibility.
Patronage and Parliamentary Management
Walpole’s survival in office for over two decades relied heavily on his command of parliamentary patronage. Patronage refers to the practice of rewarding political supporters with offices, pensions, or influence in exchange for loyalty.
He placed reliable allies in lucrative government posts.
He manipulated the Treasury boroughs (constituencies effectively under government influence) to secure a stable majority in the Commons.
He used pensions and sinecures to maintain loyalty among MPs, turning political support into a form of personal management.
Patronage: The distribution of offices, honours, or resources by those in power to secure political support and maintain control.
Although often criticised as corrupt, this system enabled Walpole to manage divisions within both Whigs and Tories, preventing parliamentary instability.
Relations with the Monarchy
Walpole’s influence was tied closely to his relationship with the Hanoverian monarchs.
George I (1714–1727)
Walpole ensured loyalty to the dynasty, securing stability against Jacobite threats.
His command of finance made him indispensable to the king.
He reconciled with royal favourites to avoid factional conflict.
George II (1727–1760)
Initially distrusted by the new king, Walpole retained power through the strong support of Queen Caroline, George II’s politically astute consort.
Queen Caroline of Ansbach (c.1727), studio of Charles Jervas, in coronation robes. As George II’s consort, Caroline’s court influence and regular consultations with Walpole were vital to sustaining his majority and policy agenda. The ceremonial costume reflects coronation iconography, which exceeds the syllabus but clarifies her status and proximity to royal power. Source
Walpole met Caroline regularly to shape policy and advise on parliamentary affairs.
This partnership safeguarded his dominance until Caroline’s death in 1737, after which his influence gradually waned.
Jacobitism: A political movement supporting the restoration of the exiled Stuart dynasty to the British throne, often seen as a threat to Hanoverian stability.
Challenges to Walpole’s Power
Despite his long tenure, Walpole faced significant opposition:
Satire on the Excise Bill (1733): Robert Walpole emerges from the Commons saying “It must & shall pass,” with opponents arrayed around him and a keyed legend below. This contemporary visual source captures the hostile political climate and public messaging during the crisis. The print includes extra details (named MPs and symbolic motifs) beyond the syllabus, useful for extension or source analysis. Source
His cautious approach to foreign policy, prioritising peace, was attacked by critics demanding a more assertive stance against Spain and France.
The outbreak of the War of Jenkins’ Ear in 1739 undermined his authority, as military setbacks fuelled public anger.
Growing radical voices accused him of corruption and betraying constitutional principles.
By 1742, following defeats in Parliament and loss of support from George II, Walpole resigned, though he retained the king’s favour with the title of Earl of Orford.
Legacy
Walpole’s era established patterns of governance that defined eighteenth-century Britain:
The emergence of the prime ministerial role, with Walpole as a central executive figure.
The use of parliamentary majorities and ministerial patronage to sustain government.
An emphasis on peace and financial stability over costly wars.
A reputation for corruption but also for pragmatism and longevity.
His career demonstrates the interconnection between financial policy, party politics, and the monarchy in shaping Britain’s early Georgian state.
FAQ
Unlike other ministers who faced blame for promoting the South Sea Company, Walpole positioned himself as a mediator.
He proposed restructuring debt and compensating smaller investors, presenting himself as both pragmatic and sympathetic. This contrasted with rivals who were discredited, allowing Walpole to appear as the only figure capable of restoring order.
Opponents claimed it represented an expansion of state power, giving excise officers intrusive authority.
Critics also spread rumours of higher taxes on everyday goods, fuelling fears of government interference in daily life.
Pamphlets and cartoons painted Walpole as a tyrant.
The bill became symbolic of corruption and perceived erosion of liberties.
The public response showed how easily financial policy could become politicised.
Queen Caroline acted as an essential intermediary between Walpole and George II.
She valued Walpole’s expertise in finance and political management, often persuading the king to trust him despite misgivings.
She held regular private consultations with Walpole.
She shielded him from rival courtiers.
Her death in 1737 significantly weakened Walpole’s influence at court.
Walpole prioritised peace to protect trade revenues and avoid new debt.
While this ensured economic stability, critics accused him of cowardice and neglecting Britain’s international reputation.
Merchants appreciated low wartime taxation.
Patriots, however, demanded aggressive action against Spain and France.
The tension between fiscal caution and national pride eroded his parliamentary support by the late 1730s.
His decline resulted from a combination of political, military, and personal pressures.
Defeat in the War of Jenkins’ Ear undermined his credibility.
The loss of Queen Caroline’s support left him exposed at court.
Growing Whig factionalism fractured his majority.
Radical critics rallied public opinion against corruption.
These overlapping pressures forced his resignation, though he retained favour with George II as Earl of Orford.
Practice Questions
Question 1 (2 marks)
What was the South Sea Bubble and in which year did it collapse?
Mark Scheme:
1 mark for correctly identifying the South Sea Bubble as a speculative financial crisis involving the South Sea Company.
1 mark for giving the correct year of collapse (1720).
Question 2 (6 marks)
Explain two ways in which Robert Walpole used patronage to maintain his control over Parliament between 1721 and 1745.
Mark Scheme:
Up to 3 marks for each valid explanation (2 × 3 = 6).
Credit should be given for:
• Placing reliable supporters in lucrative government posts to secure loyalty (up to 3 marks).
• Manipulating Treasury boroughs to ensure a dependable parliamentary majority (up to 3 marks).
• Awarding pensions or sinecures to MPs in exchange for political support (up to 3 marks).Maximum 6 marks overall.
Answers must explain how the use of patronage strengthened Walpole’s political position, not just describe patronage generally.
