The wikipedia article on John Byng (the ultimate source of the quote) is fascinating, particularly this section:

https://en.wikipedia.org/wiki/John_Byng

"Naval historian N. A. M. Rodger believes it may have influenced the behaviour of later naval officers by helping inculcate:

"a culture of aggressive determination which set British officers apart from their foreign contemporaries, and which in time gave them a steadily mounting psychological ascendancy. More and more in the course of the century, and for long afterwards, British officers encountered opponents who expected to be attacked, and more than half expected to be beaten, so that [the latter] went into action with an invisible disadvantage which no amount of personal courage or numerical strength could entirely make up for.""

So it seems that Morale did actually improve!