Leader: The Tory modernisers cannot allow the dinosaurs to win

“The supremacy of a social group manifests itself in two ways, as ‘domination’ and as ‘intellectual and moral leadership’ . . . A social group can, and indeed must, already exercise ‘leadership’ before wining governmental power.” –Antonio Gramsci

After David Cameron won the leadership of the Conservative Party in 2005, in what was, in effect, a young MPs’ coup, he presented himself as a new kind of Tory: a “moderniser”whose mission it was fundamentally to change his party and, in so doing, return it to power. He and his fellow “Cameroons” – George Osborne, Michael Gove, Jeremy Hunt et al, as well as their media cheerleaders – were determined to remake the Tories as a progressive force, fiscally conservative, socially liberal, at ease in and with a multiracial, multicultural Britain.

The Conservatives would no longer be the self-described “nasty party”. They would not, as Mr Cameron put it, “keep banging on about Europe”. The party would be environmentally conscious and pursue a green agenda. It would speak a language of “compassionate conservatism”. Even more boldly, the Tories pledged to match the then Labour government’s spending plans, because they wanted to demonstrate that the National Health Service would be safe on their watch. This was, in broad outline, the modernisers’ project.

It was easy to caricature the Cameroons back then as a group of well-meaning but deluded Notting Hill “trustafarians”, whose wealth and privilege blinded them to the reality of how most people in Britain lived. However, few doubted that Mr Cameron was sincere in his desire to modernise the party: he understood that he had to exercise leadership (and risk growing unpopular with his natural supporters) before he could win power.

What has become of the modernisers’ project? In an essay on page 22, David Skelton, the acting head of the influential right-leaning think tank Policy Exchange (his predecessor, Neil O’Brien, has recently gone to work for George Osborne), outlines what the Tories have got wrong and what is required if they are to become, again, the natural party of government.

 The Conservatives have a northern problem. Comprehensively rejected by urban voters in the north of England, the party also has only one seat out of the 59 in Scotland. In addition, the majority of black and ethnic-minority Britons do not vote Conservative.

Mr Skelton writes that the Tories urgently need to address voters’ concerns about rising energy costs and about the housing shortage (the average age of a first-time buyer is 37). He recommends that planning laws should be reformed to enable housebuilding; that new garden cities should be built and that our rundown northern towns should be reimagined and regenerated. The Labour leadership would do well to read his essay carefully, because there is much in it that is good.

Yet the larger problems for the Conservatives are self-inflicted. The botched, Andrew Lansley-led reforms of the NHS, the cut in the top rate of income tax in the 2012 Budget at a time of austerity and the unfortunate stigmatisation of welfare recipients as “shirkers” have undone much of the early successes of the modernisers. They have reminded people why they stopped voting for the Conservatives in the first place.

A battle is taking place inside the Tory party between the modernisers and the dinosaurs on the back benches and in the shires and the media, who, if they had their way, would withdraw from the European Union, close the borders and attempt to build some kind of Randian low-tax utopia.

Yet there is hope for Mr Cameron. The Policy Exchange project for reform, or greater “modernisation”, as outlined in our cover story and elsewhere, has echoes of the civic conservatism of Michael Heseltine and, before him, of Harold Macmillan, who as housing minister in the early 1950s embarked on a vast programme of housebuilding.

The Prime Minister, in a recent interview, said that he wished to remain in Downing Street until at least 2020, serving a full term if re-elected. But unless his party dramatically improves its performance and appeal in Scotland and the north of England (as well as London) and Mr Cameron demonstrates that he can govern for and in the interests of the majority, he is destined to remain a one-term prime minister and to be remembered as the “moderniser” who failed.

This article first appeared in the 14 January 2013 issue of the New Statesman, Dinosaurs vs modernisers

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How can Britain become a nation of homeowners?

David Cameron must unlock the spirit of his postwar predecessors to get the housing market back on track. 

In the 1955 election, Anthony Eden described turning Britain into a “property-owning democracy” as his – and by extension, the Conservative Party’s – overarching mission.

60 years later, what’s changed? Then, as now, an Old Etonian sits in Downing Street. Then, as now, Labour are badly riven between left and right, with their last stay in government widely believed – by their activists at least – to have been a disappointment. Then as now, few commentators seriously believe the Tories will be out of power any time soon.

But as for a property-owning democracy? That’s going less well.

When Eden won in 1955, around a third of people owned their own homes. By the time the Conservative government gave way to Harold Wilson in 1964, 42 per cent of households were owner-occupiers.

That kicked off a long period – from the mid-50s right until the fall of the Berlin Wall – in which home ownership increased, before staying roughly flat at 70 per cent of the population from 1991 to 2001.

But over the course of the next decade, for the first time in over a hundred years, the proportion of owner-occupiers went to into reverse. Just 64 percent of households were owner-occupier in 2011. No-one seriously believes that number will have gone anywhere other than down by the time of the next census in 2021. Most troublingly, in London – which, for the most part, gives us a fairly accurate idea of what the demographics of Britain as a whole will be in 30 years’ time – more than half of households are now renters.

What’s gone wrong?

In short, property prices have shot out of reach of increasing numbers of people. The British housing market increasingly gets a failing grade at “Social Contract 101”: could someone, without a backstop of parental or family capital, entering the workforce today, working full-time, seriously hope to retire in 50 years in their own home with their mortgage paid off?

It’s useful to compare and contrast the policy levers of those two Old Etonians, Eden and Cameron. Cameron, so far, has favoured demand-side solutions: Help to Buy and the new Help to Buy ISA.

To take the second, newer of those two policy innovations first: the Help to Buy ISA. Does it work?

Well, if you are a pre-existing saver – you can’t use the Help to Buy ISA for another tax year. And you have to stop putting money into any existing ISAs. So anyone putting a little aside at the moment – not going to feel the benefit of a Help to Buy ISA.

And anyone solely reliant on a Help to Buy ISA – the most you can benefit from, if you are single, it is an extra three grand from the government. This is not going to shift any houses any time soon.

What it is is a bung for the only working-age demographic to have done well out of the Coalition: dual-earner couples with no children earning above average income.

What about Help to Buy itself? At the margins, Help to Buy is helping some people achieve completions – while driving up the big disincentive to home ownership in the shape of prices – and creating sub-prime style risks for the taxpayer in future.

Eden, in contrast, preferred supply-side policies: his government, like every peacetime government from Baldwin until Thatcher’s it was a housebuilding government.

Why are house prices so high? Because there aren’t enough of them. The sector is over-regulated, underprovided, there isn’t enough housing either for social lets or for buyers. And until today’s Conservatives rediscover the spirit of Eden, that is unlikely to change.

I was at a Conservative party fringe (I was on the far left, both in terms of seating and politics).This is what I said, minus the ums, the ahs, and the moment my screensaver kicked in.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.