Cameron and Osborne are benefiting after three years of a crippled economy. Photo: Getty.
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Will the economy hand Tories the election?

The recovery may be feeble, but voters are rewarding the Tories as GDP rises – and the 'cost-of-living' is half the issue it was in 2011.

What issues will decide next year’s general election? For the major parties, the challenge is making their issues the topic of national debate.

For the Tories that means focusing on the economy, immigration and crime.

For Labour, it means steering every news agenda towards health, education and housing.

The Tories are the more trusted stewards. Voters back them to safeguard our finances, control our borders and police the streets – despite three years of sluggish growth, uncurbed immigration levels and cuts in police numbers.

Nevertheless, they are far more trusted on each of those issues than Labour. But, if the Tories are trusted to apportion the money, voters would prefer Ed Miliband’s party spend it.

This reflects a trend across developed democracies. Voters want Scandinavian levels of spending but want to pay Texan-level taxes. They want left-wing parties when asked about their public services but right-wing ones when asked about actually managing the economy or country.

That is what makes Ed Balls’ speech today on taxes and wages interesting. While Labour are reportedly going to focus on the NHS over the summer, Balls is showing how Labour will challenge the economic recovery being trumpeted by the Coalition.

Balls is doing this even though the government’s economic approval rating has dramatically recovered in the past year, buoyed by near 4 per cent growth.

This is despite only a few voters thinking the economy is on the way to recovery. But more voters think the UK is at least now showing signs of it – which most didn’t in 2013.

And in welcome news for the country, if bad news for Labour, the number of voters feeling the cost-of-living crisis has halved in the past three years.

In October 2011, 49 per cent of people were worried they wouldn’t have enough money to live comfortably. Now 25 per cent are.

This is slightly at odds with what has happened to real wages over the past four years. As George Eaton noted today, “Labour will still be able to go into the general election and answer Ronald Reagan’s question – “Are you better off than you were four years ago?” – in the negative”.

That is because inflation has outstripped people’s wages throughout this parliament.

But this appears to have little effect on the government’s economic approval ratings.

Headline GDP appears to be the only statistic that matters. At first glance there is little link between GDP and economic approval.

But, by using a three-month rolling average of GDP, we can uncover a relationship. 

The data implies that if GDP growth were 0 per cent, the government's economic approval would be -30 per cent. But for every 1 per cent of quarterly GDP growth, their approval increases 24 per cent. The realtionship is not that strong – GDP growth explains only about half of the approval rating (R² = 48 per cent) – but there is a link, as we might expect.

The importance of the economy in predicting elections is widely recognised in academic work.

As one paper recently put it, “If all you know is the state of the economy, you know pretty well how the incumbent party will do”. Nate Silver agreed – a composite measure of economic health was one of the pillars of his perfect predictions in 2012.

The fact that link appears to exists for the Tories is worrying for Labour. Until very recently, the economy had been the number one issue for voters throughout this parliament.

The growth of the past year, and the recent UKIP-fuelled focus on immigration, has changed that, but that’s more encouraging for the Tories than Labour – it’s another sign of the recovery.

This is why Labour are zeroing in on the NHS. It is the only issue on which they both have a significant lead and voters care much about (education and housing are not rated as top issues by most voters).

Immigration helps UKIP more than either party, but it helps the Tories before Labour – as their attempt to lead the news with it yesterday showed.

Labour can try and make the NHS the election’s pivotal issue, but this parliament has been defined by the economy. If GDP stays strong the left may face another five years in the wilderness.

Photo: Martin Whitfield
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Labour MP for East Lothian Martin Whitfield: "I started an argument and ended up winning an election"

The former primary school teacher still misses home. 

Two months ago, Martin Whitfield was a primary school teacher in Prestonpans, a small town along the coast from Edinburgh. Then he got into an argument. It was a Saturday morning shortly after the snap election had been called, and he and other members of the local Labour party began discussing a rumour that the candidate would be an outsider.

“I started an argument that this was ridiculous, we couldn’t have a candidate helicoptered in,” he recalls. He pointed out that one of the main issues with the Scottish National Party incumbent, the economist and journalist George Kerevan, was that he was seen as an outsider.

“I kept arguing for an hour and a half and people started gently moving away,” he jokes. “About two days later I was still going on, and I thought enough’s enough.” 

He called Iain Gray, the Scottish Labour veteran, who interrupted him. “He said, 'Right Martin, are you going to put up or shut up?’ So I filled in the forms.

"Then I had to have a very interesting conversation with my wife.”

One successful election campaign later, he is sitting in the airy, glass-roofed atrium of Westminster’s Portcullis House. Whitfield has silver hair, glasses, and wears a Labour-red tie with his shirt. He looks every bit the approachable primary school teacher, and sometimes he forgets he isn’t anymore. 

I ask how the school reacted to his election bid, and he begins “I have”, and then corrects himself: “There is a primary four class I had the pleasure to teach.” The children wanted to know everything from where parliament was, to his views on education and independence. He took unpaid leave to campaign. 

“Actually not teaching the children was the hardest thing,” he recalls. “During the campaign I kept bumping into them when I was door-knocking.”

Whitfield was born in Newcastle, in 1965, to Labour-supporting parents. “My entire youth was spent with people who were socialists.”

His father was involved in the Theatre Workshop, founded by the left-wing director Joan Littlewood. “We were part of a community which supported each other and found value in that support in art and in theatre,” he says. “That is hugely important to me.” 

He trained as a lawyer, but grew disillusioned with the profession and retrained as a teacher instead. He and his wife eventually settled in Prestonpans, where they started a family and he “fought like mad” to work at the local school. She works as the marketing manager for the local theatre.

He believes he won his seat – one of the first to be touted as a possible Labour win – thanks to a combination of his local profile, the party’s position on independence and its manifesto, which “played brilliantly everywhere we discussed it”. 

It offered hope, he says: “As far as my doorstep discussion in East Lothian went, some people were for and against Jeremy Corbyn, some people were for and against Kezia Dugdale, but I didn’t find anyone who was against the manifesto.”

Whitfield’s new job will mean long commutes on the East Coast line, but he considers representing the constituency a “massive, massive honour”. When I ask him about East Lothian, he can’t stop talking.

“MPs do tend to say ‘my constituency’s a microcosm’, but it really is Scotland in miniature. We have a fishing industry, crabs and lobsters, the agricultural areas – the agricultural soil is second to none.” The area was also historically home to heavy industry. 

After his first week in Westminster, Whitfield caught the train back to Scotland. “That bit when I got back into East Lothian was lovely moment,” he says. “I was home.”

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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