Economics, politics and the reality of the 'squeezed middle'

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Voters don’t think politicians have good ideas on living standards: why?

All are blamed for the squeeze, all are being forced to compete on this terrain and all are struggling to be heard and believed, But the challenge is greatest for Labour.

David Cameron, Ed Miliband and Nick Clegg attend a ceremony at Buckingham Palace to mark the Duke of Edinburgh's 90th birthday on June 30, 2011. Photograph: Getty Images.

If the next election is truly going to be a so-called living standards election – and that’s the assumption animating this year’s conference season - then all the parties have cause for concern. It turns out that, to date at least, voters aren’t impressed by what any of them has to say on the issue. 

In part, according to a major polling project undertaken for Resolution Foundation by YouGov, this is because they are all blamed to some degree for the big squeeze that households have endured (though Labour more than the Conservatives/coalition). No one is deemed to be innocent. But it’s also because when it comes to a wide range of policy issues on which all the parties say they want to act – tackling low pay, tax cuts for low and middle income households, reducing utility bills, boosting affordable housing or reducing the cost of childcare - the public aren’t attracted to much of what they have heard (though Labour has the edge over other parties on most of these issues).    

It’s not just that the leaders are yet to persuade the wider public that they have much to say; they are also a long way from winning over their own party supporters. Indeed, for a large swathe of the electorate the question of 'who governs' does not seem to matter terribly much when it comes to these key issues. Across a wide range of policy areas, the view that "it won't make much difference regardless of which party is running the government" was the most common response.

True, there are exceptions to this. The Conservatives score highly among their own supporters on the issue of targeting welfare payments to those who most need them -  on this nearly half (49%) say their party has especially good ideas. Labour supporters select tackling low pay as an area where their party is thought to be strong (28 per cent). Liberal Democrats chose "tax-cuts for low and middle income families" as an area where they felt their party had ideas (23 per cent). But even these fairly modest approval ratings are the exception.

Yet in most policy areas the parties receive low approval ratings, sometimes surprisingly so. Take the issue of improving access to affordable childcare, supposedly one of the zeitgeisty issues of this Parliament. A total of 5 per cent of Labour supporters select this out of a list of options as an area where their party has strong ideas - the same proportion of Labour supporters who think the Conservatives have good ideas on this issue, and marginally behind Labour voters’ assessment of the Lib Dems ideas (6 per cent). By way of comparison, 19% of Lib Dems supporters highlight childcare as an issue where their party performs well. Given that Labour dominated the debate on childcare for so long – and that it speaks so directly to their current theme of supporting family living standards – these ratings are pretty damning (and it’s no surprise that childcare is the headline announcement as Labour arrives at its conference).

All of which raises the question of why the electorate takes such a dim view of the parties’ positions to date on living standards?

Most obviously, it is very likely to reflect the fact that many voters know very little about what the parties are actually saying on these matters: our politicians’ ideas and arguments struggle to penetrate the fog of indifference that hangs over Westminster politics. It’s also true that, to varying degrees, the parties haven’t really said that much to date in terms of concrete policies: perhaps approval ratings for their ideas will pick up significantly as we get closer to the election and all the parties are forced to set out their stall?

Another explanation is that regardless of what the parties say – whether they sound like good policy ideas or not – people are just not prepared to believe them. This 'believability' argument reflects the familiar point about low levels of trust in politicians and the wider political system to deliver on promises. From this perspective, why give the parties credit for their ideas, even if in theory they might be good ones, when you don’t believe they will come to fruition?

Then comes the argument that many voters have now fully internalised the austerity argument to the extent that they just don’t believe the money will be available anytime soon to implement some of these proposed measures. Or, more specifically, if a party isn’t deemed to have earned overall credibility on the economy then whether or not their specific policies sound attractive may be a non-issue. It won’t have permission to be heard.  

Finally, it is possible to point the finger at the growing sense of fatalism, or more accurately deep scepticism about what acts of policy may achieve. Some voters believe that it doesn’t matter what the parties say on specific policy measures as none of it would make much difference anyway. The smallness of what they hear politicians talking about contrasts with the bigness of the challenges posed by globalisation, technology and trade.  The evidence to back up this fatalistic interpretation is a bit thin though attitudes do seem to have tilted in this direction over recent months. Back in April 50 per cent of voters felt that it should be possible for a government with the right policies to ensure that overall growth in the economy translates into steadily rising family living standards, and 35 per cent disagreed. Today the public is evenly split (41 per cent either way). It’s noteworthy that this increased policy-pessimism has coincided with an upturn in households’ optimism about their own prospects. 

Whatever the exact interpretation, it’s beyond doubt that each of the parties faces high stakes. All are blamed for the squeeze, all are being forced to compete on this terrain whether they like it or not, all are struggling to be heard and believed. A joyless recovery that stretches from now all the way to the election would leave the coalition parties incredibly exposed. Yet the cynical public mood is perhaps most challenging of all for Labour: its chosen pitch is that the return of growth alone won’t suffice and that only sweeping economic reform is capable of restoring the golden thread between national economic recovery and family living standards. Which means that it, more than anyone else, needs to convince a disenchanted electorate of both its overall economic credibility and the merits of its headline proposals. A tall order, but surely not an impossible one. 

Gavin Kelly is chief executive of the Resolution Foundation