A Letter from London - Political Prospects in the UK for 2025
Global Political Turmoil in 2024
The year 2024 was marked by significant upheaval in democratic politics worldwide. Incumbent leaders faced numerous challenges, with India's Prime Minister Modi returning to office in a diminished capacity, needing to form a coalition. In the United States, despite a strong economy, Donald Trump was re-elected, becoming the first former US President to be re-elected since 1892. Germany and France experienced prolonged parliamentary turmoil, adding to the global political instability.
Surprising UK General Election Results
In the UK, the General Election held in July produced some of the most unusual results in British electoral history. The Labour Party, after four successive defeats, returned to power with a landslide majority of 174 seats, their second-largest ever. However, their share of the popular vote was only 33.7%, the sixth lowest for Labour in the 22 General Elections since World War Two. This suggests that the UK's party and electoral system is failing to adequately represent voters on a range of economic and geopolitical issues.
Comparisons with Tony Blair's Victory
Following Keir Starmer's electoral victory, many political commentators drew comparisons with Tony Blair's stunning Labour victory in 1997. With a similarly unassailable majority, it was presumed that Starmer would enjoy a prolonged period in office. Although some critics view Starmer as lacking in policy, he has been relatively clear in his social democratic instincts. He supports modest tax increases, steady regulatory changes, small steps towards closer continental relationships without unraveling Brexit, and light-touch public sector reform without upsetting Whitehall and the Trades Unions. Despite the pre-election talk of 'Change,' Starmer's government has so far offered more continuity with the Sunak administration.
Parallels with the 1970s Labour Administrations
There are notable parallels between the early days of Starmer's government and the Wilson/Callaghan Labour administrations that took office in February 1974, promising a 'social contract' to restore industrial harmony. To quickly end long-running public sector disputes, Starmer has made inflation-busting deals with striking unions in the NHS, railways, and local government. His Chancellor has exempted the public sector from unprecedented hikes in employers' National Insurance and imposed generous minimum wage increases without considering their inflationary impact on low-pay differentials. The history of the late 1970s suggests these early measures may backfire by the end of this decade, especially if Starmer continues to alienate key groups such as the elderly, the farming community, and private schools.
Starmer's Political Resilience
Despite a turbulent first six months in office and signs of voter remorse, it would be unwise to write off Keir Starmer and his party too soon. Unlike his predecessors in the late 1970s, Starmer has shown that he will not tolerate dissent within the Labour Party. This ruthlessness could be a double-edged sword. In the last election, five previously safe Labour seats fell to left-wing independents. The weakness of the Conservative Party makes it harder for radical leftist voters to support the Greens or breakaway parties without risking a Conservative win.
Time on Starmer's Side
Starmer has the advantage of time on his side. With control of the political agenda for at least another four years and a huge parliamentary majority, he has the leeway to drive forward lasting reforms. This is in stark contrast to the past decade, which was dominated by Brexit, Covid, and internal strife under successive Conservative Prime Ministers.
Challenges for the Conservative Leadership
For the Conservative leadership, 2025 looks perilous. Kemi Badenoch faces significant challenges despite her endorsement by the Party membership. The scars from Margaret Thatcher's removal in 1990 took decades to heal, and the anger from Boris Johnson's ousting remains. The media continues to report on Liz Truss's latest interventions, and Iain Duncan Smith still sits on the Conservative benches.
Difficulties in Emulating Trump's Victory
The Conservatives might look enviously at Trump's Republican victory but face difficulties in emulating it. Badenoch, having served as a minister during a calamitous period in office, struggles to appeal to disillusioned Britons. Her stance on the 'war on woke' isn't enough to win a plurality of voters. Labour's shallow popular appeal and the impact of the first-past-the-post system are notable, but the Conservatives' hold on their 121 seats is also tenuous. In only five constituencies do the Tories have a majority of 10,000 or more, and in 66, the majority is less than 4,000. In contrast, the Liberal Democrats have 25 MPs with five-figure majorities and only 16 defending majorities below 4,000. Their targeted campaign brought their best result in 101 years, making it difficult to dislodge their MPs.
Balancing Appeals to Different Voter Bases
The Tories face a dilemma: crafting an appeal to win back Home Counties and West Country seats while needing a different message for 'Red Wall' constituencies. Reform UK poses a significant threat, challenging for votes in coastal Kent, Essex, Norfolk, Lincolnshire, and volatile parts of northern England and Wales. This process began in earnest during local government by-elections last year.
Threat from Reform UK
The Conservative-Labour duopoly's enduring appeal is under threat. Unlike the SDP's failed attempt in the 1980s, today's Conservative Party lacks a reliable support base to fend off Reform UK's advance. Polling suggests Brexit is seen as the UK's biggest strategic mistake, and the Conservatives' association with it may hinder their recovery. Reform UK, despite its origins in the Brexit Party and UKIP, stands ready to attract right-of-centre voters seeking an alternative untainted by Brexit's failings.
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