One of the big political surprises in Britain’s history came less than two months after VE Day, when the triumphant war leader, Winston Churchill, ran for re-election against the cerebral and relatively uncharismatic Clement Attlee. Churchill was defeated in a landslide. Historians mostly agree that whilst Churchill’s wartime record was respected, voters, and particularly returning soldiers, trusted Attlee’s Labour Party to provide the jobs, healthcare and welfare state that would make the peace worth living in. The UK’s recent struggles have been economic. But just as the ungrateful voters of 1945 turfed out Churchill, so the voters of 2015 could do the same to their own (economic) saviours, David Cameron and George Osborne.
The UK’s recovery is now in its second year, but it has yet to have a significant effect on the Conservatives’ popularity: in the latest poll their share is 28 per cent, 4 per cnet behind the Labour Party, which has maintained a similar lead since May 2013. One potential explanation is the stagnation in the real incomes of voters, as inflation has outstripped wage growth. That trend looks to be coming to an end, however, potentially ushering in a year of real wage growth coupled with a booming housing market, which could lead many voters to feel wealthier than at any point since the last election.
That will likely aid the Conservatives’ standing heading into 2015 and the polls are likely to narrow (as they do in the run-up to most general elections). But perhaps the Conservatives should be careful what they wish for. James Carville’s oft-misquoted campaign memo, "the economy, stupid", does not refer to an immutable law of politics. The economy is often the most important issue in elections, but by no means always. Indeed, when the economy was doing well, as it was in the UK from '96 -'07, other issues like healthcare and education took on the greatest salience (Chart 5).
Economic optimism in the UK is now at its highest level since records began in 1979. The salience of the economy as an issue is falling fast, whilst that of the NHS and education, Labour’s strongest suits, is rising. The significant lead the Conservative Party has on economic management looks likely to endure in the absence of an unforeseen downturn before the next election. But it also looks likely to become less important to the result.
The big battles of the next election will be fought over control of the agenda. If the health of the economy continues to fade as an issue and the debate moves on to more fertile Labour territory like the provision of public services then the Conservatives will likely struggle to overtake Ed Miliband’s party. The latest debacle over extremism in schools is just the kind of distraction that plays into Labour’s hands and just the kind the Tories have been instructed by campaign manager Lynton Crosby to avoid.
The saving graces for the Conservatives have long been assumed to be Ed Miliband’s weak personal brand and his party’s lingering association with economic failure. Yet the Conservatives’ own vulnerabilities look just as concerning. Cameron’s personal brand is strong but his party's remains stubbornly off-putting to much of the electorate. Forty per cent say they would never vote Conservative against 33 per cent who would not vote Labour. The Conservatives face a huge disadvantage under the current electoral system, which could see Labour become the largest party even if it loses the popular vote by up to 3 per cent. And of course there’s Ukip, which, while it takes votes from all parties, stands to be significantly more damaging to the Conservatives than to anyone else.
The European elections (where Ukip came first) probably showed the crest of the party’s popularity, at least for the next year or so, but the local elections, held on the same day, indicated that the party could have a disruptive effect in a variety of key swing seats, particularly in Essex and Thurrock, where Labour must win seats to become the biggest party.
A "super poll" of swing constituencies commissioned by Tory peer Lord Ashcroft just before the local elections indicated that high Ukip shares in areas like Thurrock would gift those seats to Labour, resulting in a majority for the party of 83. It should be noted, however, that a similar poll held in 2009 projected a Conservative majority of 70 which never materialised.
So what to conclude? More positive economic news should benefit the Conservatives, but could well prove a double-edged blade if voters conclude that it’s safe to switch to the party they prefer with cherished public services. Between now and the election, the Conservatives will do all they can to ensure the economy remains foremost in people’s minds, which is why the chart below is a key one to watch. If Labour can succeed in shifting the debate into other areas, as it previously accomplished with its proposal to freeze energy prices, then David Cameron may soon find himself joining the ranks of respected ex-prime ministers.
Richard Mylles is a political analyst at Absolute Strategy Research, an independent investment consultancy
Chart 5: Most important issues facing the UK
Source: ASR Ltd. / Ipsos Mori