2 July 2024

As we enter the last 48 hours of the election campaign, polling suggests we may see historically low turnout, with limited enthusiasm from voters for any of the parties on offer. What seems to be cutting through the general apathy is a desire for change and the removal of the Conservatives from Government. To that end, more voters than ever appear to be thinking strategically about how they cast their ballot and turning to tactical voting.

What is tactical voting?

Tactical voting is a strategy used by voters to maximise the impact of their vote, usually to prevent another candidate from winning. This works by voters offering their support to the party that is most likely to beat the undesired candidate.

For instance, if a Liberal Democrat supporter in a Conservative/Labour marginal wanted to prevent the Conservative candidate from winning, they would lend their vote to the Labour Party to maximise the chances of keeping the Conservatives out.

What influence could tactical voting have in the 2024 election?

Despite the predicted scale of a Labour majority, the large swing of vote share means that many voters who have long been in ‘safe’ seats now find themselves voting in a tight race. Those in previously safe Conservative seats may have felt free to vote for third parties in the past in the knowledge that tactical voting would have little impact. However, at this election, the chance of beating the Conservatives seems very real in many seats which may persuade people to vote tactically for whoever has the best chance at beating the Tories, whether they be Labour, SNP or Liberal Democrat.

What does the polling say?

Polling from YouGov has shown that 33% of voters are intending to vote tactically to stop the party they like the least from winning, up from 19% in 2019. When broken down to which party they like the least, 70% said the Conservatives, with only 26% saying Labour. The overwhelming majority of tactical voting at this election is expected to prevent another Conservative term in Government.

Of those voting tactically, 46% are choosing Labour over the Conservatives and 28% are choosing the Liberal Democrats over them too. 82% of Remain voters and even 43% of Leave voters who plan to vote tactically said they would do so to try and stop the Conservatives from winning. On the right, there also appears to be more enthusiasm for Reform UK than the Conservatives. Of those who will be voting for their first choice of party, 25% are supporting Reform UK, with only 19% supporting the Tories as their first choice.

What is the connection between tactical voting and the Liberal Democrats?

An interesting story emerging from the polling numbers is the level of tactical voting among Liberal Democrat supporters. 46% of 2019 Lib Dem voters have said they will vote tactically at this election, with 87% of those voting against the Tories. In addition, 53% of those who say they will vote for the Liberal Democrats in 2024 are doing so for tactical reasons.

How are different demographic groups voting?

When looking at demographic breakdowns, there is a clear trend of younger voters being more likely to vote tactically, and older voters being more likely to back their favourite party. Among 18-24 year-olds, 38% say they will vote tactically, with 91% of those doing so to prevent a Conservative candidate from being elected, indicating a potential dissatisfaction with policies like national service from the Tories.

The level of tactical voting amongst younger people could be attributed to online campaigns by organisations including Best for Britain and Stop the Tories. However, even amongst the over 65 age group, 28% are voting tactically with 43% of those doing so against the Tories, suggesting that dissatisfaction with the Government has penetrated even their largest voter group.

Conclusion

If tactical voting succeeds on Thursday, many high-profile Conservatives could be vulnerable. Current polling suggests a worst-case scenario for the Conservatives could be a seat count as low as 57.

1906, 1945 and 1997 all saw landslide defeats from the Conservatives, at the hands of co-ordinated anti-Tory coalitions. In 2024, tactical voting could play a bigger role than ever, with individual efforts and coordinated campaigns working towards ousting them, ultimately playing a potentially significant role in a Labour victory.

Visit our Elections ’24 microsite for the latest on polling and election analysis, up to election day and beyond.

10 January 2024

Having lived in relative political obscurity since his promotion to leader of the Liberal Democrats in 2019, Sir Ed Davey finds himself in the political spotlight this week after the Post Office Horizon scandal. An historic miscarriage of justice which had been left to smolder for more than 10 years, it was reignited by the ITV drama, Mr Bates Vs the Post Office.

The Government’s reactive response to the resurrection of the story (Rishi Sunak has announced emergency legislation to exonerate victims of the Post Office scandal today) has quelled some of the disdain directed towards the Conservative establishment, for now – although it should be said that Sunak’s growing tendency towards government by the news agenda does not project an image of assured leadership.

Ed Davey, however, who was Minister for Postal Affairs under the Coalition Government at the time of the wrongful convictions, has fared less well after it emerged that he refused to meet campaigning sub-postmasters at the time. Although he has attempted to apologise, his claim that he was misled by the Post Office has been read as an attempt to pass the buck, and suggestions that he is keen to shift the blame have landed him fighting accusations of hypocrisy.

Former Cabinet Minister, Sir John Redwood, and Deputy Conservative Chairman, Lee Anderson, are now leading calls for his resignation.

What next for Sir Ed Davey?

We’ve not yet had any clear indication from Davey as to whether he intends to resign, or indeed from the Liberal Democrat Party as to its appetite to push Davey out before he jumps (a technical possibility according to the federal election regulations, although party sentiment resides with Davey for now at least). And whilst this issue could yet subside just as quickly as it arose, political pressure is continuing to stack up against him, leaving a leadership election looking increasingly likely.

Strategists in CCHQ will no doubt be enjoying watching this fallout unfold. Without a leader at its helm, the party would risk undermining the progress it had made towards election in its target seats, opening a door for the Tories to reassert themselves in the parts of the blue wall that had looked likely to turn orange.

Of course, the opposite may also prove to be true. Davey is liked and respected as an individual; as a politician, however, he has failed to capture the public’s imagination. His solid leadership has seen the Lib Dems make up ground in recent by-elections and would no doubt guide the party to an improved electoral performance on 2019. He is unlikely however to deliver a barnstorming win for the party, and victory is unlikely in all 80 seats that the Lib Dems have marked out to target under his relatively neutral leadership.

A fresh face could provide the party with the injection of energy that it needs to give momentum to the campaigns in those target seats. But the limiting factor will be time. Internal party regulations stipulate that the election process must take between seven and fifteen weeks, suggesting that a new leader may not be installed for two, if not three, months. With an election mooted for November, and the majority of the potential candidates still relatively unknown amongst the wider voting public, party staff would have their work cut out if they were to successfully raise the profile of Davey’s successor to such an extent that they were able to breathe new life into the campaign.

Please get in touch with Claudia Mulholland for more information on the leadership election process and the potential runners and riders to replace Davey.

6 November 2023

The next General Election could be over a year away, but the main political parties are already in campaign mode.

It is notable how the City’s perceptions of Keir Starmer’s party have shifted, with the focus now on Labour’s plans for Government and what role the City could play in delivering Labour’s vision.

Labour faces a challenge. It has a legacy of 13 years of sometimes contradictory policy ideas that all wings of the party have been pushing the leadership to adopt. The National Policy Forum final document is over 110 pages, outlining an ambitious agenda with more priorities than any government could deliver in one term. If Labour does win, they may not have the luxury of a sizable, or any, majority, so the crucial question would be: what do they prioritise?

The approach to financial services has a clear focus on consumer protection. Regulating buy-now-pay-later schemes is cited. Although the party’s views on crypto have softened, shadow cabinet ministers have referred to the crypto market as a “Ponzi scheme” and the party has not joined the Government in talking about making the UK a “global cryptoasset hub”.

The policies show enduring support for productive finance. With both parties seeking to jolt the UK out of its sluggish growth, Labour sees business investment as a key solution. Shadow Business Secretary Jonathan Reynolds has lauded the Solvency UK reforms as a “benefit of Brexit”. Labour has focused on incentivising pension fund investment into the real economy. Initiatives such as encouraging DC pensions to invest in tech start-ups – Long-term Investment For Technology and Science (LIFTS) – may well continue.

Labour sees the financial sector as crucial to the net zero transition. The party’s push for an uptick in covered green bonds, under their Green Prosperity Plan, is a response to Biden’s Inflation Reduction Act. The lack of fiscal headroom for mass subsidies or tax exemptions increases Labour’s reliance on the financial sector for the success of the net zero transition. Their commitment to embed ESG in firms’ regulatory requirements is a sign that Labour will take a different approach to the Government, who have deliberately slow-pedalled initiatives like the Green Taxonomy and Sustainability Disclosure Requirements.

Much of what will define the party’s relationship with the City will be what – for now – remains unsaid. Labour’s revenue-raising proposals are currently limited to a windfall tax on oil and gas companies and ending tax breaks for private equity, non-doms and private schools. But Labour may be forced to change tack. Last February, Starmer tabled an amendment to the Finance Bill to cancel the reduction in the banking surcharge, which would have seen banks pay taxes of over 30 per cent on their profits. Labour insists that they won’t raise taxes on the sector, but they will face pressure to do so from campaign groups and activists. This issue of taxation will be a litmus test for Labour’s support for financial services.

The Government’s reforms to the post-2009 settlement, particularly those that are seen as injecting risk back into the financial system (like the ringfencing reforms or the proposed new-look short selling regime) could be unpicked by a Labour Party uneasy at overruling regulators. With a Treasury led by Rachel Reeves, a former regulatory policymaker, Labour may defer more often to the Bank of England and FCA.

The success of the City over the coming years may well rest with a new top team that sees the financial services as a key enabler of their policies.

Get in touch with us to talk about Labour’s approach to financial services or Labour engagement strategies or sign-up to our UK Public Affairs newsletter here.

This article was originally published in City AM.

20 October 2023

Overnight the Conservatives suffered defeat in two by-elections at the hands of Labour in Tamworth and Mid Bedfordshire, overturning large Tory majorities in an unprecedented night in British politics. The results further reinforce Labour’s dominant position in the polls and mark an impressive few weeks for Keir Starmer, the Labour leader, who also led his party to success in the Rutherglen and Hamilton West by-election two weeks ago.

For the Conservatives, these historic results are prompting conversation on whether Rishi Sunak’s approach is the right one, given his net zero pivot and his party conference speech seemed to have had little impact. Two successive losses could hasten Rishi Sunak’s reset in advance of the State Opening of Parliament and Autumn Statement next month.

Despite a good dollop of expectation management, it was a crushing night for the Conservatives, who suffered their worst by-election night in history. The Labour Party overturned the largest majority in raw number of votes in Mid Bedfordshire and achieved their second biggest-ever swing against the Conservatives in Tamworth.

On the other hand, in both by-elections, turnout was markedly down, which isn’t uncommon in mid-Parliament polls, although it does reinforce the view that neither party is doing enough to drag its own voters to the polls. This could benefit the Conservatives at a general election, seeing as  should traditional Tory voters decide to cast a ballot at all they are likely to stick with the party of government. Expect more rumblings from Tory backbenchers calling for tax cuts to motivate their base to turn out at the polls in the weeks and months ahead.

The success of Reform in Tamworth is also worth noting, with the Tories potentially suffering a pincer movement from both left and right in those Leave-voting seats in the North and the Midlands, although they could yet be squeezed during the course of a five-week general election campaign.

What lessons can we learn from these elections?

We should never try and extrapolate too much from individual election results, especially while we’re still probably 12 months out of an election. On the other hand, the respected psephologist Professor Sir John Curtice noted that “there are no silver linings” for the Tories, unlike in the summer when the party unexpectedly held on to Boris Johnson’s old seat of Uxbridge and South Ruislip. Additionally, with Labour increasing its share of the vote despite a strong challenge by the Liberal Democrats in Mid Bedfordshire suggests they are not simply riding the protest vote wave, but are capturing switchers that they will need to hold on to in order to take the keys of Number 10 off Rishi Sunak.

As ever, the West Midlands will be a key battleground for the next election. It is too simplistic to say so goes the West Midlands so does the country, but a region that handed the majority of its seats to Labour in 1997 and backed Brexit in 2016 underscores the constantly changing shift in political dynamics in the region. In Tamworth, the Conservatives were all but wiped out in the local elections this year and have now lost the area’s Parliamentary seat. The result leaves the Government needing a significant recovery in the polls, not just to prohibit the now likely Labour majority in the next General Election, but to recover to respectability and avoid a result that could be the worst Conservative Party performance of the post-war era.

For the Labour Party, the last three weeks could hardly have gone any better. First the win in Rutherglen reaffirmed the party’s belief they are making a comeback in Scotland and now two wins in England are edging the party ever close to power. The only thing now will be to maintain the momentum, not get carried away and be prepared to respond to a potential policy shift by the Conservatives.

For our full analysis on Labour’s Conference, its policy proposals and what they mean for business, get in touch.

27 September 2023

Bournemouth has been awash with orange over the last four days, as Liberal Democrats returned to the south coast for their first in-person autumn conference since 2019. The run of recent by-election victories and burgeoning rumours that the Lib Dems could assume the role of “King Maker” at the next General Election sparked a level of media and corporate interest that the party has not enjoyed since 2015. However, as with Leader Ed Davey’s publicity stunt kayak capsize, the Lib Dems’ electoral fortunes may not be all plain sailing.

A fight against the Tories

In an interview last month, Davey said that he had spent the entirety of his political life fighting the Conservatives. That is clearly no different today. His abiding message for this conference was this – he wants the Tories out of Number 10. And his plan to do it? Push them out of power in the 80 Tory-held seats in which the Liberal Democrats came second in 2019 (and of course, Mid Bedfordshire, where the party came third to Labour) toppling the so-called “Blue Wall”.

To that end, the party is seeking to appeal directly to disillusioned, lifelong Conservative voters in those target seats. Their promise to Blue Wall voters is a fair deal on the economy and the cost-of-living crisis, jobs, nature, and public services including the NHS. The Liberal Democrat membership has, on the whole, bought into that strategy. There was rapturous applause for Davey in the conference hall yesterday as he presented his commitments on health, an agenda designed specifically to appeal to those Blue Wall voters for whom access to public services is a key priority.

A softer stance on Brexit

But there is growing disquiet within the membership as to what that electoral strategy omits. For one, Davey and his front bench team have rowed back their rhetoric on Brexit. Having pledged in 2019 to “stop Brexit”, the party has now adopted a softer line with those target Tory voters in mind. It now envisages the UK rejoining the EU in the long term but focuses in the short term on rebuilding dynamic relationships with our European partners through the rehabilitation of schemes such as Erasmus Plus. This position does not sit well with members for whom Brexit, and its perceived failings, still stand out as perhaps the most important issue. Davey’s brief reference to Brexit was the only part of his speech yesterday which moved members to their feet. For now, however, Davey has managed to skirt this issue. 

Leadership housing proposals demolished by youth wing amendment

Where he was not so successful was on the issue of housing. His attempt to pull back on housebuilding commitments was overruled by the youth wing of the party, ably led by rising star Janey Little, who captured the support of the membership to successfully recommit the party to its existing target of 380,000 new homes a year. The amendment was pitched by Little as a policy to inspire hope in struggling young voters, disillusioned by the realities of the rental market and unable to save for a deposit. Support for it speaks to a desire to rehabilitate the reputation of the party with younger voters after the tuition fees debacle. But there is concern within the leadership that the decision will skew its electoral strategy in the Blue Wall which pits the all-important Tory swing voters against the youth vote. And indeed, some senior figures have warned that the effects of this decision could be felt immediately in Mid Bedfordshire where the Emma Holland-Lindsay’s Conservative opponent will surely use it as a stick with which to beat her. If it turns out to be a successful line of attack it may resurface into key campaigning ground at the next General Election.

Low rumblings: if the Blue Wall doesn’t fall, Davey might

If that is the case, the Lib Dems may not be feeling as jubilant the morning after polling day as they were this weekend. And if so, questions will surely arise as to what is next for the party. Poor performance in 2019 demanded a new leader to replace Jo Swinson. The party might find itself again looking for a new leader to replace Davey if 2024 is similarly disappointing. Unlike in Conservative parliamentary circles, succession planning to replace Davey is not yet evident – Lib Dems, for now, fully buy into the prospect of a storming success at the next election. So much so, its leadership is resolutely against discussing a Lib-Lab pact. But whilst manoeuvres may not yet be being made, potential leadership candidates are emerging. Wendy Chamberlain and Layla Moran both garner some support and are confident of re-election, but streets ahead is Deputy Leader, Daisy Cooper, who packed out rooms across the weekend in an indication of her standing with the membership. The future then, once again, looks female for the Liberal Democrats.

For further insight from this year’s Lib Dem conference contact Claudia.Mulholland@h-advisors.global

18 September 2023

The last Liberal Democrat Autumn Conference that took place in person was in 2019, pre-COVID. In what could be deemed as bad luck, since 2019 the Party held two Conferences online in 2020 and 2021, before their 2022 Conference was cancelled following the passing of the Queen. Now, buoyed by recent by-election success and positive polling data (all relative, of course), the Party will be heading to Bournemouth with a spring in their step.

However, outside of the Party bubble, the Lib Dems continue to divide opinion among businesses, public affairs consultants, and the media over whether they remain relevant. On one side, they are considered possible ‘King makers’ in a minority Government at the next General Election and could hold significant influence over the direction of travel. They have also demonstrated that no swing is too big to overturn at a by-election, most recently in Somerton and Frome with a 29-point swing from the Conservatives. On the other side, they are the fourth largest Party in Parliament and considered unable to translate by-election swings at a General Election. Their status as a small Party is evident when looking at Electoral Commission data on Party Spending last year – the Labour Party’s spending totalled £44.5m, the Conservative’s spending was £33.06m whilst the Lib Dems spent £6.7m.

This year’s Party Conference won’t just be about proving to the UK that they are on the relevant side of that debate. They, like the Labour Party, have an important job to do to ratify policy proposals ahead of their General Election manifesto. Debates will be held on motions, put forward in advance, which Members can then speak in favour of. If a motion is passed, then it becomes Lib Dem policy. This process will be even more important this year as the Lib Dem Manifesto Working Group, Chaired by Lord Newby, is in the process of putting together its document. Lord Newby has said this manifesto will be slimmed down, featuring just three to five key policies the Party wants to be known for, to avoid the last manifesto’s mishap where legalising marijuana was the only policy people remembered.

Whatever your perception is of the Party, the Conference will be an exciting time for its members and for businesses. For members, this is the first time they will be together in four years, and they will be celebrating campaign successes across the UK. For businesses, they will have a chance to speak to new MPs, old MPs and PPCs who could be the ‘King makers’ at the next General Election.

To get in touch with the H/Advisors Cicero team during Conference, please contact: Claudia Mulholland at claudia.mulholland@h-advisors.global