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Three Main Trends in UK Politics: the Bad, the Worse and the Somewhat Positive

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As we approach a general election that is likely to occur during the autumn of this year, I propose to comment on what I regard are the three key aspects of UK politics at the present time:

  • The increasing acceptance that Brexit was a mistake;
  • The paralysis of the UK’s current Tory government and its impact on the economy and UK society; and
  • The increasing acceptance of the urgent need for planning reform in the UK.

The increasing acceptance that Brexit was a mistake

According to a poll conducted by the organisation Statista.com in February 2024, 56% of those polled thought it was wrong for the UK to leave the European Union, while 32% believed it was right, and there were 12% ‘don’t knows’. Young people in particular considered that Brexit was a mistake, with 70 percent of 18 to 24 year old’s and 66% of 25 to 49 year old’s believing it was the wrong decision. 56% of those 65 and over thought it was the right decision.

It is of course possible that some young people will change their minds as they grow older and join the over 65s in taking a positive view of Brexit. We must also bear in mind that even if 56% of the whole population share the view that Brexit was a mistake, it will still take some time and an increase in that figure to at least 65% of so before one could say with confidence that the UK should seek to rejoin the EU.

Meanwhile, the British public continue to experience more and more of the disadvantages that Brexit has wrought on life in the UK. Young people like the son of a friend of mine are finding huge obstacles in their path to pursue relationships with people they have met in EU countries, let along studying or working there. People with second homes in EU countries like France and Spain, some of whom even voted Leave in the referendum, have been surprised to find that they can only stay there for a maximum of 90 days out of 180. It is estimated that trade frictions resulting from Brexit have reduced the UK’s GDP by 4% from the level it would have reached at the present time, in addition to reducing tax revenues by around 40 billion pounds per year. Multinational companies like Tesla have decided to forgo investing in the UK because they no longer view it as a good location from which to make exports to EU countries. The UK is finding itself excluded from discussions on defence and security issues between EU countries at a time when Europe (including the UK) are increasingly menaced by Russia. Performing artists from the UK, in particular musicians, are finding it much more difficult than before to tour EU countries.

Our government insists that the UK’s economy is performing well compared with EU countries such as Germany and France, but our growth rate is in fact very slow, and is actually negative when GDP is calculated on a per capita basis. There is also a general tendency to blame our current sluggish growth and poor productivity performance on the Covid pandemic and the war in Ukraine. Those excuses are wearing thin however as the pandemic and the war recede in importance. Meanwhile, the UK faces huge future challenges in producing sufficient economic growth to fund pensions and social care for an increasing cohort of elderly people, to remedy the growing inefficiencies of the NHS and to provide more adequate benefits for people who are unable to work as a result of long-term illness or unemployment.

As I discussed in my November 2018 post ‘Brexit: The Crunch’ (https://wordpress.com/post/interesting-times.org/1232), I have always believed that the key problem with Brexit is that it was supported by two groups of people whose interests and expectations were very different. The idea of leaving the EU was championed mainly by a small minority of ardent believers who believed that the UK could prosper as a type of Singapore off the shores of Europe, benefiting from its history of free trade and long connections with the US and Commonwealth countries, plus substantial deregulation of the economy in terms of employment and product standards. The majority of those who voted Leave in the 2016 Brexit referendum, however, did so either because of dissatisfaction with their economic position or because they were nostalgic for the ‘golden age’ of the 1950s and 60s. That majority expected the UK government to continue spending generously on the NHS, social care and benefits, and they were not happy about the dilution of their employment rights or food standards. That is a major reason why the UK has not been able to agree a new trade agreement with the United States. That would have been difficult in any case given that the UK has long had a favourable trade balance with the US and it is always difficult to get trade deals through the US Congress. But it proved to be impossible partly because the British public would never accept the dilution in food standards that the US insisted on (e.g., the infamous ‘chlorinated chicken’). The impact of the Tories’ preferred ‘hard Brexit’ on the UK/Northern Ireland/Republic of Ireland border(s) also made it difficult to secure the support of US legislators concerned about the impact on the peace process in Northern Ireland. These were all inevitable problems that should have been foreseen by the promoters of Brexit. However, those individuals were deluded by their unshakable confidence that Brexit would inevitably be a success. They became subject to a type of ‘magical thinking’ that blinded them to the problems they were certain to face.

I consider it inevitable that there will be a gradual return to closer trade and other relations between the UK and EU countries. This has already begun to a degree, with the 2023 Windsor Agreement establishing a special trading framework for Northern Ireland, and the UK’s readmission to the Horizon Europe scientific research initiative from January 2024, but it is likely to speed up considerably under the Labour government that will almost certainly take office later this year. It will be some time, however, possibly decades, before a UK government will have the confidence to lead the UK back to full membership of the EU. More likely in my view is a special association agreement that builds on the importance of the UK’s contribution to European security and defence. Meanwhile Brexit will continue to drag on the UK’s economic prospects and our living standards will gradually fall behind EU standards to the point where the great majority of the UK population can no ignore the decline. That assumes, of course, that the UK can avoid an economic crisis of the kind that we narrowly avoided after the financial markets lost trust in the short lived Liz Truss government. If we do experience such a crisis, that might concentrate minds sufficiently to result in an earlier return to the EU fold.

The paralysis of the UK’s current Tory government and its impact on the economy and UK society

Our present UK Conservative (Tory) government was elected with a large majority in December 2019 with a mandate to ‘get Brexit done’. It must be said that they did achieve that, with the UK formally leaving the EU on 1st January 2021, when the exit transition period ended. The period between December 2019 and the end of 2020 was largely taken up with the final negotiations to implement Brexit and, of course, the initial stages the Covid pandemic. Some aspects of Brexit remain incomplete, however. The UK is continuing to delay the implementation of proper checks on food and other goods imports from EU countries because of (valid) concerns that they will contribute to food price inflation and reduce the range of goods in our shops. We are also still not operating outbound passport checks on people leaving the UK (in the way that EU countries do). Without such checks, how can we know how long EU (and other non-UK nationals) have remained in the UK? Meanwhile Brexit related issues have taken up a large proportion of our current government’s time and attention through this Parliamentary term, leaving little time for more productive initiatives.

Meanwhile our Tory government has failed to make a real impact on the serious problems affecting the UK, including (i) our persistent poor productivity record, (ii) the worsening quality of NHS care and social care, (iii) the failure to build sufficient new housing and infrastructure to accommodate an increasing population, and (iv) the insufficiency of tax revenues to meet pressing social needs. On top of all these problems there has been an unprecedented fall in per capita real incomes over the course of the current Parliament. Millions of mortgage holders are also having to pay much larger mortgage payments due to higher interest rates. It is no wonder that the former Tory Chancellor and now Lord Kenneth Clarke has warned that the next UK government will “will face the biggest set of problems of any new UK administration since the second world war” (as reported in the Financial Times on 14th April 2024).

There is no doubt that the UK has been buffeted by serious problems over the period since 2008. First there was the Great Financial Crisis starting in 2007/08, the Brexit Referendum in 2016 followed by years of fractious negotiations with the EU and internal Tory political warfare, the Covid Pandemic between 2020 and early 2022 and finally the Ukraine War. Per capita real incomes in the UK have barely grown since 2007 and real incomes have actually fallen during the period of high inflation that started in early 2021. Any government would have found it difficult to handle all of these problems. Our present Tory government, however, has dealt particularly badly with the hand it was dealt. In my view this is due to a number of key factors:

  • An ideological and over-simplistic implementation of the decision to leave the EU led by Tory politicians with a limited grasp of modern trade realities and the UK’s true position in the world.
  • Boris Johnson’s lack of attention to detail and his overall lack of seriousness. He simply lacked the capacity to implement the major policy change of Brexit at the same time as he had to deal with the impact of the Covid pandemic.
  • A large number of competent Tory politicians and former ministers (e.g., Anna Soubry, Amber Rudd, David Gauke and Dominic Grieve) who had the potential to be effective ministers in the current government, were forced out of the party and government by colleagues with an ideological attachment to a ‘hard Brexit’.
  • The obsession of many Tory MPs with reducing taxes and stopping illegal migrants entering the UK. The former problem resulted in Liz Truss’s and Kwasi Kwarteng’s rapid implosion as Prime Minister and Chancellor in October 2022.
  • The government’s inability to implement structural reforms (e.g., planning reform and reform of the childcare system) due to the influence of entrenched interests and its over-dependence on elderly voters. Ironically, Liz Truss might have made some headway on these issues had she and her Chancellor not unwisely put unfunded tax cuts ahead of all else.
  • Given its inability to implement much needed structural reforms, the government has thrown its energies into ‘culture war’ issues like ‘stopping the boats’ and, frankly, into stoking racial divisions throughout the UK.

Our current Prime Minister Rishi Sunak and Chancellor Jeremy Hunt have made progress over the past 18 months in stabilising the UK’s economic situation, but the key problems identified above remain in place. They may have prevented things getting much worse, but they are unable to do anything to improve matters. The past two yeas have been largely wasted years in terms of resolving the UK’s deeply seated problems. Effective steps to improve matters will have to await the election of a new government later this year.

The increasing acceptance of the need for planning reform in the UK

I have believed for many years that the UK’s planning system is too restrictive and, in particular, makes it impossible to build sufficient new houses for the country’s existing and future population. I produced a number of posts on this topic between November 2014 and January 2015, e.g.:

I was not the only person with such views, but we were very much in the minority. I recall canvassing for the LibDems in Westminster during the 2010s and speaking with young voters who were struggling with high rents and could not afford to purchase a flat or house for themselves, but who were convinced we could not possibly tamper with our restrictive planning rules. The idea of allowing houses to be built in green belt areas was anathema to them.

I eventually concluded that I was whistling in the wind and hopelessly unrealistic in believing the British public could be persuaded that genuine planning reform is needed. Attitudes have started to change, however, and there is increasing support now for relaxing the UK’s over strict planning controls and allowing building in the less salubrious parts of our green belts. I believe a major reason for this is that ambitious young people with a media presence have been dismayed by the fact that despite earning a high salary, they are unable to buy even low quality flats and houses in London and other urban areas with high housing costs. More broadly, a large proportion of young voters who support the Labour Party are pressing Labour MPs and candidates to tackle the squeeze on their living standards from the combination of higher education loans and high rents in urban areas, let alone the challenge of saving enough to pay the deposit to purchase a house or flat.

The individuals and organisations pursuing the case for planning reform include:

  • Tom Harwood, Deputy Political Editor and Presenter for GBNews;
  • Duncan Stott, a former Director of @pricedoutuk;
  • Chris Worrall, Chair of the Poplar and Limehouse Labour Party;
  • Ant Breach of Centre for Cities;
  • Robert Colville, Director of the Centre for Policy Studies think tank;
  • Sam Bowman, Editor of Worksinprogress.co;
  • Kristian Niemietz, Editorial Director of the IEA think tank.

All of the above post frequent comments about housing on ‘X’.

The Labour Party is also showing real signs of interest in making it easier to build houses in the UK, as I discussed in my post 9th July 2023 post ‘Rachel Reeves and Labour Economic Policy: a Welcome Emphasis on Planning Reform’ (https://wordpress.com/post/interesting-times.org/1539). It remains to be seen whether they will follow through in government, but I suspect they will have difficulty in promoting much needed economic growth in the UK if they fail to do so.

Michael Ingle – michaelingle01@gmail.com

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