The LibDems: A Need for Fresh Thinking

The 2015 UK election was truly a debacle for the Liberal Democrat party, of which I am a member. The LibDems now have only eight MPs in the House of Commons (down from 57), and their share of the vote fell from 23.5% to 7.9% (a massive reduction). There are various explanations for the collapse.  The key factors appear to have been dissatisfaction on the part of previous supporters with the LibDems’ decision to enter into coalition with the Conservative party in 2010, plus their agreement to large university tuition fee increases, which they had solemnly promised not to allow before the 2010 election.

I believe the voters’ rejection of the LibDems was deeply unfair.  The British economy really was in a dire state in 2010 in the aftermath of the financial crisis, with government borrowing at a vertiginous 12% of GDP per annum, greater than Greece’s deficit at the time.  The financial markets could easily have turned against the UK and trashed the pound.  It was therefore essential to form a new and stable government as soon as possible, instead of risking another election after what would likely have been a short period of minority government led by the Tories.

Many voters have short memories, however, and they now blame the shortcomings of the coalition government, despite its overall success, on the LibDems.  As a result, we now have a real Tory government, Tory in tooth and claw, with consequences that we shall experience over the coming years.

I have no doubt that the coming experience of an unalloyed Tory government will create plenty of room for the opposition parties, both the LibDems and Labour.  Our membership of the EU will hang in the balance for over two years, with corrosive effects on the economy, and we may well leave it (likely followed by Scotland’s departure from the Union).  There will be no improvement in the housing situation, as the Tories have promised not to make further planning reforms and they are against building more social housing.  And we will see a whole slew of spending cuts, with dire effects for benefit recipients and a further weakening of our already inadequate defences.   Plus there will certainly be tax increases, if the Tories are serious about balancing the budget over the next four years while reducing taxes for the wealthy to boot.

It will be tempting for many LibDems to take refuge in the likelihood that sole Tory rule will create its own opposition, lifting the boats of both Labour and the LibDems.  As a result, many of them will seek to reinvigorate the same policies that the party has been promoting for some years now, such as :

  • on the economy, a ‘middle way’ between Labour and the Tories;
  • the protection of civil liberties;
  • the UK’s membership of the EU;
  • ‘localism’, including opposition to development in greenfield and in particular greenbelt areas;
  • ‘green’ policies

I have no objection to a number of these, in particular the protection of civil liberties, the UK’s membership of the EU and support for environmentally friendly growth.

However, I do question the party’s ‘middle way’ approach to the economy, as well as its commitment to localism.  Nick Clegg’s promise during the recent election campaign to ‘soften the edges’ of a Labour or Tory government made it appear as if the LibDems had no distinctive policies on the economy. This would be all well and good if there were no other policies to choose from, but the commitment to a ‘middle way’ led the party to ignore such issues as Britain’s continuing failure to match the productivity of other advanced economies, the enormous trade deficit, our overly strict planning system and the unfairness of property taxation in the UK.  As for localism, it is true that the LibDems have prospered over the years by prioritising the needs of constituents, but this did not prevent LibDem MPs with excellent reputations for their constituency work from losing their seats in the election, such as Lynne Featherstone and Simon Hughes.  At the same time, I believe that an over emphasis on localism has resulted in the LibDems giving too much attention to the interests of established interests, such as existing homeowners who oppose new housing developments in their areas.

I believe that the LibDems need to rethink their policies from the ground up.  Such a review should be founded on the party’s traditional principles of economic and social liberalism, fairness and openness. It should also have regard to the interests of voters whose interests are not in my view well represented by the Tories or Labour, in particular the aspirational young and those who are concerned about civil liberties.

A policy review should pay particular attention to the following issues:

  • Liberalisaton of planning and improved building standards – It is almost a truism that we have a housing crisis in the UK.  All major parties promised during the election campaign to build vastly increased numbers of houses if elected, ranging up to 300,000 houses a year in the case of the LibDems.  However, none of the parties (including the LibDems) willed the changes to the planning system that will be necessary to meet the increased targets.  Building standards in the UK are also lamentably low.  New houses and flats here are apparently the smallest in Europe, with three bedrooms being squeezed into properties of 75 square metres, with tiny windows and low ceilings.  Whenever I travel by train I see these wholly inadequate new developments, that few owners of older houses would wish to occupy.  Why then can the LibDems not champion a serious relaxation of existing planning restrictions, allied with improvements in building standards?  Present policies are hardly ‘fair’ to young people (and not so young people) who are priced out of either renting or buying decent properties.
  • Council tax reform – The UK’s council tax system has become extremely regressive, with occupants of million pound plus properties paying little more council tax than those who occupy the cheapest properties.  The owner of a £1 million flat in Westminster pays around £1,300 council tax per year, whereas the owner of a property of similar value in New York City would pay ten times as much. This is simply not fair and the system should be made far more progressive. Revising the existing council tax bands would be far less divisive than the LibDems’ former ‘mansion tax’ proposals, and would also raise much more money.
  • New ideas on health care and elderly care – It is obvious that the NHS needs additional funding to meet increasing demands for care, particularly from the elderly.  NHS head Simon Stevens has estimated he will need an extra £8 billion pounds of funding per year by the end of the current Parliament (which all the parties promised to provide during the election campaign).  This is likely to prove a gross under-estimate of the actual need, however.  At the same time, there is great concern about the failure to link up health and elderly care, with the result that many elderly people are delayed in leaving hospital because of the need to make care arrangements for them.  But possibilities for improvement are seriously constrained by the commitment of all the major parties to preserve the NHS in its current form.  There is no doubt this policy is supported by the majority of voters, and it may well have been appropriate in the late 40s when the NHS was first established.  However, we live in a different era now.  Health care has become far more expensive and the public’s expectations are much higher than they were.  In addition, many of the people with the greatest need (in particular the elderly) are much better off financially than they were when the NHS was founded.  We must find a way both to inject greater flexibility into the provision of health care (even if that involves the ‘privatisation’ of some services), and to challenge the belief that NHS care should always be ‘free’.  Certainly NHS care should be free for those who cannot afford to pay anything, but we must find a way to secure extra contributions from those who can afford them.  People (especially the elderly) say they paid taxes and NICs throughout their lives and should not have to pay any more.  However, given the current level of health care costs, it is simply not true that contributions made in the past cover current costs.  £8 billion of extra funding a year is not going to sae the NHS.  Fresh thinking is desperately needed and the LibDems could provide it.
  • Constitutional change –  Nick Clegg recommended during the election campaign that a ‘Constitutional Convention’ should be set up to examine ways in which the UK’s constitution can be changed.  The devolution of powers to Scotland and Wales, and the promised further devolution to Scotland, has created a very messy situation. There is no neat answer to the ‘West Lothian question’ of Scottish MPs voting on legislation affecting only England.  The Tories propose that only English MPs should be able on legislation affecting only England, but this would be difficult to implement in practice and would in effect create a ‘second class’ of Scottish MPs.  A Constitutional Convention would be able to look at all possible ways of resolving this problem, including a full federal solution involving a separate English Parliament, or the division of England into several regions that would have the same level of autonomy as Scotland.  I realise that the English are not hankering after a German or US style constitution for the UK, but we do have to get to grips with the inadequacies of our current setup.  A Constitutional Convention could get to grips with this, while also tackling the outdated House of Lords and our unrepresentative first past the post voting system.
  • Increase defence cooperation and cost sharing with EU allies – There has been much discussion about whether or not to replace our Trident submarines and, if so, whether we should go for full or partial replacement.  I do not have strong feelings on this subject, though it seems very likely the new Tory government will authorise full replacement.  Far more important in my view is the need to strengthen our conventional forces and stop them being further run down.  This should be done in co-operation with other EU countries, certainly with France, but also with countries like Germany and Italy that have been reluctant to increase their defence spending over the years.  Why should the LibDems not pursue changes in this area?  One LibDem voter I canvassed a few months ago was very concerned that we should do more to secure our armed forces.  This is not and nor should it be an exclusively Tory issue.

I have not included the EU in the above list as I consider our EU membership to be a cross party issue. Certainly the referendum, and the campaign for the UK to remain in the EU, will be a major preoccupation over the next two years.  I will fully support the ‘Yes’ campaign, regardless of the ‘success’ or otherwise of David Cameron to negotiate reforms. However, this is a cross party issue, with many members of the Labour and Tory parties also strongly supporting our continued membership.  It is not an issue on which the LibDems have a distinctive policy that marks them out from the other parties.

I am also not overly concerned about the ‘left-right’ dichotomy and the proportion of national resources that should be devoted to public spending.  It appears that the British public (or at least the English public) has accepted the need for more public spending cuts and limited tax increases.  Or at least the 36.9% of voters who supported the Tories have accepted the need.  Some may well change their minds on this subject as the Tories implement their manifesto promises.  If so, there may be more support in 2020 for increased government spending.  For the time being, I do not believe there is a lot to be gained by the LibDems identifying themselves firmly with one side or the other of this debate.  The issues that are most likely to distinguish the LibDems from the other parties and attract new voters in the lead-up to the next election are not those that involve spending a lot of money.

In conclusion, I am concerned that if the LibDems do not conduct a root and branch review of their policies, the party could end up as ‘Labour-lite’ – focussing on welfare issues and preserving an ossified NHS, BBC and the like.  This may appeal to many of the LibDems’ traditional supporters (now reduced to a mere 7.9% of voters), but it will not appeal to voters – particularly young voters – who would gain if some of the policies I have described above are implemented.

There is no rush to adopt a new program; we need working groups and conferences to consider these and other ideas.  We should also elect a new leader who has an open mind and is not stuck in the past.

Michael Ingle

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Categories: Economics, EU, Housing, Politics

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