Scalloped potatoes and ham

6 medium potatoes, peeled and sliced thinly
3 Tablespoons butter
3 Tablespoons flour
salt and pepper
1 1/2 cups cubed ham

2 1/2 cups milk
1/4 cup finely chopped onion
1 Tablespoon butter

Melt butter in saucepan over low heat.  Blend in flour and seasonings.  Stir in milk.  Heat to boiling, stirring constantly.  Boil and stir for 1 minute.  In greased 2 quart casserole, arrange potatoes in two layers, topping each with half the onion and 1/3  of the white sauce.  Top with remaining potatoes and sauce.  Dot with 1 Tablespoon butter.  Cover and bake for 30 minutes in 350 degree oven.  Uncover and bake 60 minutes longer.  Let stand 5-10 minutes before serving.