The Tories shouldn't assume that Miliband's unpopularity will save them

In 1979, the Tories won despite Jim Callaghan's lead over Margaret Thatcher. Cameron's lead over Miliband isn't enough to guarantee Tory success.

Tory MPs have rejoiced at today's YouGov/Times poll showing that Ed Miliband is viewed by voters as "less trustworthy, decisive or competent than Gordon Brown". It's worth noting that Miliband is rated as a better leader than Brown by 32 per cent to 17 per cent and that around a third of voters have yet to make up their mind about him (meaning he still has time to win them round) but the numbers are hardly encouraging for a man who hopes to become prime minister in less than two years' time. 

The Labour leader's unimpressive personal ratings are one reason why many Conservatives continue to believe that they will be the largest single party after the next election. David Cameron, they point out, has consistently led Miliband as "the best prime minister" in YouGov polling (by 32-21 the last time the question was asked) and has regularly enjoyed a higher net approval rating. By framing the 2015 election as a presidential contest - do you want David Cameron or Ed Miliband as your prime minister? - they hope and believe they can overturn Labour's poll lead. 

It's true that Miliband's ratings are a concern for Labour; such figures are frequently a better long-term indicator of the election result than voting intentions. Labour often led the Tories under Neil Kinnock, for instance (sometimes by as much as 24 points), but Kinnock was never rated above John Major as a potential prime minister. More recently, in the 2011 Scottish parliament election, Alex Salmond was ranked above Iain Gray even as Labour led in the polls. The final result, of course, was an SNP majority. 

But while Cameron's greater popularity could save the day for the Tories, it is complacent of the party to assume as much. History shows that a well-liked (or, more accurately, less disliked) leader is no guarantee of electoral success. In the final poll before the 1979 election, Jim Callaghan enjoyed a 19-point lead over Margaret Thatcher as "the best prime minister" but that didn't stop the Conservatives winning a majority of 44 seats. Similarly, in the 1970 election, Harold Wilson's personal lead over Ted Heath (a 51 per cent approval rating compared to one of 28 per cent for Heath) didn't stop Labour going down to a decisive defeat. 

It's too early to say which precedent 2015 will follow, but the key point is this: there is no reason to assume that Miliband's ratings (should they fail to improve) will cost Labour victory. In the meantime, the Tories would be wise to focus on the potential obstacles to a Conservative win: the surge in support for UKIP (which will almost certainly improve on its 2010 share of 3 per cent), the defection of Lib Dem supporters to Labour in Tory-Labour marginals (the seats that will determine the outcome of the election) and the continuing lack of growth.

In 2010, David Cameron's lead over Gordon Brown wasn't enough to deliver the Tories a majority. In 2015, his lead over Miliband may not be enough to deny Labour victory. 

David Cameron and Ed Miliband walk through the Members' Lobby to listen to the Queen's Speech at the State Opening of Parliament on May 8, 2013. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty Images
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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR