Why did Labour lose so badly?

The fundamentals - the Tories' advantage on leadership and the economy - reasserted themselves.

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Plenty in Labour were braced for a mediocre election result. With the party expected to lose almost all of its 40 Scottish seats (a forecast which proved terrifyingly accurate) it would struggle to advance far from the 258 it won in 2010. But few anticipated the calamity that befell them last night.

The Tories are now projected to win a majority (with 329 seats), a remarkable result after a term of austerity. David Cameron is on course to become the first incumbent prime minister since 1955 to increase his party's vote share. Labour, meanwhile, is expected to have just 233, 25 fewer than it won in the assumed nadir of 2010. Among the casualties, remarkably, is Ed Balls, a huge loss to his party and the Commons. As in 1992, when the "shy Tories" fooled the pollsters, the Conservatives have benefited from those only prepared to profess their loyalty in the privacy of the voting booth.

The great surprise of the night was not Labour's performance in Scotland (which was merely as terrible as forecast) but its performance in England and Wales. It not only failed to make sufficient gains from the Tories, it lost seats it won under Gordon Brown.  Southampton Itchen, held by the party since 1992, went blue, as did Balls's Morley and Outwood, Bolton West, Telford, Derby North and the Vale of Clwyd. What explains failure on this scale? The Tories' SNP scare campaign, the hostility of the press to Labour and the Conservatives' funding advantage will all be widely cited. But the most plausible explanation is that, as the Tories long expected, "the fundamentals" simply reasserted themselves. For years, the Conservatives had enjoyed a commanding advantage on leadership and economic management. No opposition party has ever won while trailing on these. Labour's painfully large deficit on both made defeat inevitable.

This interpretation points to the need for Labour to restore its economic reputation and to elect a leader with far wider appeal than Ed Miliband (whose personal ratings evolved from terrible to merely bad during the campaign). But a fierce debate will now take place within the party over whether it lost because it drifted too far from New Labour or rather did not drift far enough. Those from the party's right will point to Miliband's refusal to state that the last government spent too much (failing to "concede and move on" in Philip Gould's phrase) and to act earlier to reassert Labour's fiscal probity (spending years opposing every cut in sight). But those on the left will criticise his decision to promise to moderate austerity, rather than to end it. In the absence of a clearer dividing line between the Tories and Labour, voters hungry for an alternative to the coalition were drawn to the SNP, Ukip and the Greens.

It is this argument that will now define the Labour leadership contest to come, with Chuka Umunna expected to represent the former position and Andy Burnham the latter. But with the party near-extinct in Scotland (holding one of the country's 59 seats), even more marginalised in the south and threatened by the Conservative boundary changes to come, the existential question will simply be "how can we win from here?" Labour is losing votes in all regions and to all parties for different reasons - to Scottish nationalists, to anti-immigration Ukippers, to southern conservatives, to anti-austerity Greens. There is no obvious strategy to address them all.

George Eaton is deputy editor of the New Statesman.