Sir Howard Kingsley Wood (19 August 1881 – 21 September 1943) was a British Conservative politician. The son of a Wesleyan Methodist minister, he qualified as a solicitor, and successfully specialised in industrial insurance. He became a member of the London County Council and then a Member of Parliament.
Wood served as junior minister to Neville Chamberlain at the Ministry of Health, establishing a close personal and political alliance. His first cabinet post was Postmaster General, in which he transformed the British Post Office from a bureaucracy to a business. As Secretary of State for Air in the months before the Second World War he oversaw a huge increase in the production of warplanes to bring Britain up to parity with Germany. When Winston Churchill became Prime Minister in 1940, Wood was made Chancellor of the Exchequer, in which post he adopted policies propounded by John Maynard Keynes, changing the role of HM Treasury from custodian of government income and expenditure to steering the entire British economy.
One of Wood's last innovations was the creation of Pay As You Earn, under which income tax is deducted from employees' current pay, rather than being collected retrospectively. This system remains in force in Britain. Wood died suddenly on the day on which the new system was to be announced to Parliament.
Early years
Wood was born in Hull, eldest of three children of the Rev. Arthur Wood, a Wesleyan Methodist minister, and his wife, Harriett Siddons, née Howard. His father was appointed to be minister of Wesley's Chapel in London, where Wood grew up, attending nearby Central Foundation Boys' School. He was articled to a solicitor, qualifying in 1903 with honours in his law examinations.
In 1905 Wood married Agnes Lilian Fawcett (d. 1955); there were no biological children of the marriage, but the couple adopted a daughter. but Jenkins writes that Wood's knighthood was essentially for his work in the insurance field.
When Baldwin formed his second government in 1924, Wood was appointed Parliamentary Secretary to the Ministry of Health, as junior minister to Neville Chamberlain. The two served at the Ministry of Health from 11 November 1924 to 4 June 1929, becoming friends and firm political allies. Wood's political standing was marked by his appointment as a civil commissioner during the general strike of 1926, In 1930 he was elected as the first chairman of the executive committee of the National Union of Conservative and Unionist Associations. and set up a national teleprinter service. For the telephone service, still mostly dependent on manual operators, the GPO introduced a programme of building new automated exchanges. For the postal service, the GPO built up a large fleet of motor vehicles to speed delivery, with 3,000 vans and 1,200 motor-cycles. Wood was a strong believer in publicity; he set up an advertising campaign for the telephone system which dramatically increased the number of subscribers, and he established the GPO Film Unit which gained a high aesthetic reputation as well as raising the GPO's profile. Most importantly, Wood transformed the senior management of the GPO and negotiated a practical financial deal with HM Treasury. The civil service post of Secretary to the Post Office was replaced by a director general with an expert board of management. The old financial rules, by which all the GPO's surplus revenue was surrendered to the Treasury had long prevented reinvestment in the business; Wood negotiated a new arrangement under which the GPO would pay an agreed annual sum to the Treasury and keep the remainder of its revenue for investment. By the outbreak of the Second World War, Britain was producing as many new warplanes as Germany. By early 1940, Wood was worn out by his efforts, and Chamberlain moved him to the non-departmental office of Lord Privy Seal, switching the incumbent, Sir Samuel Hoare, to the Air Ministry in Wood's place. Wood's job was to chair both the Home Policy Committee of the cabinet, which considered "all social service and other domestic questions and reviews proposals for legislation" and the Food Policy Committee, overseeing "the problems of food policy and home agriculture". He held this position for only a few weeks; the downfall of Chamberlain affected Wood in an unexpected way.
In May 1940, as a trusted friend, Wood told Chamberlain "affectionately but firmly" that after the debacle of the British defeat in Norway and the ensuing Commons debate, his position as Prime Minister was impossible and he must resign. He also advised Winston Churchill to ignore pressure from those who wanted Lord Halifax, not Churchill, as Chamberlain's successor. Both men acted on Wood's advice. Churchill became Prime Minister on 10 May 1940; Wood was appointed Chancellor of the Exchequer on 12 May.
Chancellorship of the Exchequer and death
One of the reasons for Wood's appointment to the Treasury seems to have been Churchill's urgent desire to be rid of the incumbent Chancellor of the Exchequer, Sir John Simon, whom Churchill detested. In peacetime, the Chancellor of the Exchequer is often the most important member of the cabinet after the Prime Minister, He presented four budgets to Parliament. His first, in July 1940, passed with little notice, and brought into effect some minor changes planned by his predecessor. Of more long-lasting impact was his creation in the same month of a council of economic advisers, the most notable of whom, John Maynard Keynes, was quickly recruited as a full-time adviser at the Treasury. Jenkins detects Keynes's influence in Wood's second budget, in April 1941. It brought in a top income tax rate of 19s 6d (97½ pence in decimal currency) and added two million to the number of income tax payers; for the first time in Britain's history the majority of the population was liable to income tax. He was 62.
Wood was referred to in the book Guilty Men by Michael Foot, Frank Owen and Peter Howard (writing under the pseudonym "Cato"), published in 1940 as an attack on public figures for their failure to re-arm and their appeasement of Nazi Germany.