Only Labour can win majorities. Under PR Ukip's 100 MPs could prop up the Tories. Photo: Getty.
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The Tories can’t win majorities – they should back PR

Under our system, only Labour can win majorities. If the Tories want the Right in power, they should reform the system.

This post first appeared on - our election site.

For a long time it made sense for the two major parties to oppose electoral reform.

Since 1945 our “First Past The Past” system has handed at least 85 per cent of seats to Labour and the Tories at every election, even though they now win over only around 65 per cent of voters. Changing the system may have been more representative, and appease those who clamoured for “fairness”, but it made little sense for either party.

That is no longer true. While it has long been clear that our system disadvantages smaller parties, the way it cripples the Tories has only become apparent in recent years – when the “Big Two” stopped winning anything near 40 per cent of the vote.

The way our system cripples the Tories has only become apparent in recent years.

The Tories should back electoral reform because they can no longer win majorities. They haven’t won one for 23 years.

In 2010 they added to their vote share for the third consecutive election – and were still 2.4 million voters shy of the 14.1 million John Major won over in 1992.

Major won more votes than any British political leader ever. And he still only had a majority of 21. Cameron won a million more votes than Blair did in 2005. Blair had a majority of 66. Cameron was 36 short of one.

In a six-party system, the party’s Thatcherite majorities aren’t coming back.

In 1997 and 2001, when the party was at its nadir, our system handed them just 25 per cent of seats, when they won 30-31 per cent of the vote. In a six-party system, the party’s Thatcherite majorities aren’t coming back.

Cameron won 36 per cent of the vote in 2010. For the past three years, his party have been stuck in the low 30s. They rarely poll below 30 per cent, but can’t surpass 33-34 per cent

For this to change, the party needs to win over Labour centrists who couldn’t countenance Thatcherism or absorb the Lib Dems. And Ukip needs to fade. None is likely.

After their astounding failure to reform parliament’s boundaries, the party is now in a perennial bind: to govern, it has to form coalitions with the Lib Dems. Supply and confidence agreements would only last as long as they convenience the party propping the Tories up, and a minority government would achieve little.

The party is now in a perennial bind: to govern, it has to form coalitions with the Lib Dems.

That future must hold limited appeal for the party’s 1922 Committee of backbench MPs, or the 100-plus MPs who won in 2010 in hope of government office.

So how could they reform the system? YouGov’s Peter Kellner recently suggested Cameron should have backed AV in 2011 – the second-preferences of Ukippers would hand Tories 20 seats they will otherwise lose in 2015.

Lord Ashcroft has shown nearly half of Ukippers do choose the Tories as their second preference – twice as many as would switch to Labour – but, as Ipsos MORI explained in detail in 2011, any prediction of AV’s effect relies on “heroic assumptions”.

Voters, let alone pundits, can’t know how they would vote under a voting system that doesn’t exist. And without constituency-level data national hypotheticals are fairly limited.

One party could put instantly put the Right into power – Ukip, with 100 MPs.

Admittedly, the Tories aren’t awash with options. Unless they return to their late 1990s nadir, any form of proportional representation (PR) would hand them fewer seats than First Past The Post. Coalitions would be inevitable. But sacrificing a distant, unlikely and occasional success is surely preferable to watching the Labour party form majority after majority, as they are far more likely to do.

Tory votes are clustered in safe seats, which means Tory MPs are elected by around 3,000 more votes than Labour MPs. Tories MPs are more “legitimate”, but at the cost of many wasted votes. If the parties win the same number of voters, Labour win 35-40 more seats.

Under PR Labour would never form a majority government again. Labour and the Tories would have around 220 seats, 100 short of a majority. The Lib Dems would have fewer than 50, and the Greens as many as 30.

But one party could put instantly put the Right into power. Ukip would be parliament’s new kingmakers, with 100 MPs.


Harry Lambert was the editor of May2015, the New Statesman's election website.

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Stability is essential to solve the pension problem

The new chancellor must ensure we have a period of stability for pension policymaking in order for everyone to acclimatise to a new era of personal responsibility in retirement, says 

There was a time when retirement seemed to take care of itself. It was normal to work, retire and then receive the state pension plus a company final salary pension, often a fairly generous figure, which also paid out to a spouse or partner on death.

That normality simply doesn’t exist for most people in 2016. There is much less certainty on what retirement looks like. The genesis of these experiences also starts much earlier. As final salary schemes fall out of favour, the UK is reaching a tipping point where savings in ‘defined contribution’ pension schemes become the most prevalent form of traditional retirement saving.

Saving for a ‘pension’ can mean a multitude of different things and the way your savings are organised can make a big difference to whether or not you are able to do what you planned in your later life – and also how your money is treated once you die.

George Osborne established a place for himself in the canon of personal savings policy through the introduction of ‘freedom and choice’ in pensions in 2015. This changed the rules dramatically, and gave pension income a level of public interest it had never seen before. Effectively the policymakers changed the rules, left the ring and took the ropes with them as we entered a new era of personal responsibility in retirement.

But what difference has that made? Have people changed their plans as a result, and what does 'normal' for retirement income look like now?

Old Mutual Wealth has just released. with YouGov, its third detailed survey of how people in the UK are planning their income needs in retirement. What is becoming clear is that 'normal' looks nothing like it did before. People have adjusted and are operating according to a new normal.

In the new normal, people are reliant on multiple sources of income in retirement, including actively using their home, as more people anticipate downsizing to provide some income. 24 per cent of future retirees have said they would consider releasing value from their home in one way or another.

In the new normal, working beyond your state pension age is no longer seen as drudgery. With increasing longevity, the appeal of keeping busy with work has grown. Almost one-third of future retirees are expecting work to provide some of their income in retirement, with just under half suggesting one of the reasons for doing so would be to maintain social interaction.

The new normal means less binary decision-making. Each choice an individual makes along the way becomes critical, and the answers themselves are less obvious. How do you best invest your savings? Where is the best place for a rainy day fund? How do you want to take income in the future and what happens to your assets when you die?

 An abundance of choices to provide answers to the above questions is good, but too much choice can paralyse decision-making. The new normal requires a plan earlier in life.

All the while, policymakers have continued to give people plenty of things to think about. In the past 12 months alone, the previous chancellor deliberated over whether – and how – to cut pension tax relief for higher earners. The ‘pensions-ISA’ system was mooted as the culmination of a project to hand savers complete control over their retirement savings, while also providing a welcome boost to Treasury coffers in the short term.

During her time as pensions minister, Baroness Altmann voiced her support for the current system of taxing pension income, rather than contributions, indicating a split between the DWP and HM Treasury on the matter. Baroness Altmann’s replacement at the DWP is Richard Harrington. It remains to be seen how much influence he will have and on what side of the camp he sits regarding taxing pensions.

Meanwhile, Philip Hammond has entered the Treasury while our new Prime Minister calls for greater unity. Following a tumultuous time for pensions, a change in tone towards greater unity and cross-department collaboration would be very welcome.

In order for everyone to acclimatise properly to the new normal, the new chancellor should commit to a return to a longer-term, strategic approach to pensions policymaking, enabling all parties, from regulators and providers to customers, to make decisions with confidence that the landscape will not continue to shift as fundamentally as it has in recent times.

Steven Levin is CEO of investment platforms at Old Mutual Wealth.

To view all of Old Mutual Wealth’s retirement reports, visit: products-and-investments/ pensions/pensions2015/