|Global Insight Perspective || || |
|Significance ||While in retrospect the result hardly looks surprising, this was a much closer election than in 1997 and 2001, and for a time at the start of the campaign the Conservatives seemed capable of returning to power. |
|Implications ||The Conservatives and Liberal Democrats are clearly disappointed not to have a taste of power, but both performed creditably and will hope to build on their progress over the coming four years. For the smaller parties there was a mixed story - the nationalists performed patchily, the Eurosceptics fell back, and the far-right made worrying gains. |
|Outlook ||The narrower majority has provoked intense speculation over Prime Minister Tony Blair's future and he will have much greater difficulty passing legislation. Some of the bolder reforms may well have to be shelved unless Labour can impose much stricter discipline on its unruly backbenchers. The potential for instability should not be exaggerated, however, as in most respects it will be a case of business as usual. |
Labour's Majority Shrinks by Around 100 After 'Iraq Effect'
|2005 General Election Results (As of 12:30 p.m., 6 May) |
|Party ||Seats ||Gain ||Loss ||Net ||Votes ||% ||+/- |
|Labour ||353 ||0 ||47 ||-47 || |
|36.2 ||-5.9 |
|Conservative ||196 ||36 ||3 ||+33 ||8,695,604 ||33.1 ||+0.5 |
|Lib Dem ||62 ||16 ||5 ||+11 ||5,950,408 ||22.7 ||+3.8 |
|SNP ||6 ||2 ||0 ||+2 ||412,267 ||1.6 ||-0.2 |
|Plaid Cymru ||3 ||0 ||1 ||-1 ||174,838 ||0.7 ||-0.1 |
|Respect ||1 ||1 ||0 ||+1 ||68,065 ||0.3 ||+0.3 |
|Ind Kid Hosp ||1 ||0 ||0 ||0 ||18,739 ||0.1 ||0.0 |
|UKIP ||0 ||0 ||0 ||0 ||602,579 ||2.3 ||+0.8 |
|Green ||0 ||0 ||0 ||0 ||257,758 ||1.0 ||+0.3 |
|BNP ||0 ||0 ||0 ||0 ||191,573 ||0.7 ||+0.5 |
|Scottish Soc ||0 ||0 ||0 ||0 ||43,514 ||0.2 ||-0.1 |
|Scottish Grn ||0 ||0 ||0 ||0 ||25,760 ||0.1 ||+0.1 |
|Liberal ||0 ||0 ||0 ||0 ||19,068 ||0.1 ||0.0 |
|Others ||1 ||1 ||0 ||+1 ||233,569 ||0.7 || |
|Turnout ||26,235,665 ||61.2 ||+2.1 |
|After 623 of 646 seats declared |
|Source: BBC |
At the time of writing, 623 of 646 seats have been declared and centre-left Labour is on 353 to the centre-right Conservatives' 196 and the Liberal Democrats' 62. That equates to -47, +33 and +11 seats for the three respective parties compared to 2001. The BBC state broadcaster is forecasting that the ruling party will end up with an absolute majority of 66, an impressive achievement, but well down on the 167 achieved in 2001. In terms of vote share, Labour lost six points, down to around 36%. In countries with proportional representation (PR) electoral systems this would condemn it to coalition government, but the UK's first-past-the-post system rewards even a narrow victory handsomely. Winning a third consecutive victory is a rare achievement in British politics, and this is the first time that Labour has managed it. Previous Labour governments have endured rollercoaster rides of initial optimism and bold leftist reforms followed by acute political and economic difficulties. 'New Labour' is much more moderate and pragmatic, and much more tightly run and disciplined.
In most constituencies Labour lost a considerable percentage of support, but the gains at its expense were shared broadly among the other parties. This makes it very hard to speak of uniform trends. The Conservatives' overall support actually rose relatively little and it was instead the Liberal Democrats which benefited most from the Iraq war protest vote. Tactical voting was apparent in many areas, with the Liberal Democrats doing well in seats where they stood little chance of defeating Labour, but not so well in others where they could have defeated Labour candidates and possibly brought in a Conservative government 'by the back door'. This meant that the Liberal Democrats were somewhat disappointed not to have secured more seats. Iraq does indeed seem to have been the biggest single reason for Labour's poorer performance, and the connected loss of trust in Prime Minister Tony Blair. In the end, however, this disquiet was not enough to cancel out the generally positive view of Labour's domestic performance, particularly on the economy. The government was helped too by the ongoing problems the Conservatives are having with their own presentation. Leader Michael Howard may have helped the party turn the corner, but there were a great many people who voted Labour only to keep the Conservatives out.
This article now turns to look at what the results mean for each of the major parties and for the third-term Labour policy agenda.
Implications for Labour and its Leadership
The election victory is bittersweet for Labour. That it was achieved at all is remarkable in historical terms, but at the same time the majority is relatively slight and there has been a clear drift away from the ruling party in most constituencies. The discomfort is greatest for Tony Blair himself as it is clear that Iraq and perceptions of him as a leader were two of the biggest factors turning voters away. There has long been intense speculation that Blair would step aside after a third victory and this should not be counted out given these results. Waiting in the wings is Chancellor Gordon Brown, whose leadership ambitions are well-known. He is also regarded by most voters as Labour's biggest asset given the economic stability he has overseen. Although the time might seem ripe for change at the top, Blair has shown that he still has plenty of appetite for government, nonetheless. This makes an early resignation very possible, and the soonest it is likely to happen is next year. Brown meanwhile seems unlikely to force the issue despite the strong encouragement of some of his supporters. Blair's biggest problem could be repeated difficulties passing legislation in parliament - an inability to marshal his backbenchers would leave him badly weakened and vulnerable (see later section). He also faces the likely defeat of the proposed European Union (EU) constitution in a referendum scheduled for next year.
For other leading figures in the party the first preoccupation will be the new cabinet Blair unveils. Hotly tipped for rehabilitation is former home secretary David Blunkett, who resigned after a sex scandal. Election co-ordinator and Brown rival Alan Milburn has meanwhile counted himself out of the running to spend more time with his family. Gordon Brown himself is almost certain to stay in the cabinet as chancellor and may well wield his heightened power to ensure that young allies get key posts. Other rumours point to Iraq-scarred Defence Secretary Geoff Hoon being replaced by Transport Secretary Alistair Darling, while some believe that Jack Straw will be elbowed out as foreign secretary. At least three junior ministers will not be returning, after they lost their parliamentary seats (Stephen Twigg, Melanie Johnson and Chris Leslie), but there were no 'decapitations' of senior figures in any party at the end of the day.
Implications for the Conservatives
A maximum of another five years in the wilderness is clearly a major disappointment for those who once regarded themselves as the natural party of government. The Conservatives have still to recover fully from the unpopularity of the final years of prime minister Margaret Thatcher and her successor, John Major. The party has also struggled to define itself as it finds its centre-right space invaded by Labour. A lack of strong would-be leaders has not helped, and current leader Michael Howard carries the baggage of his time in the last Conservative governments. This said, yesterday's election was still viewed as encouraging by most in the party. Over 30 seats have been added to the party's tally and there were some notable Labour scalps claimed. No senior Conservatives fell victim to the Liberal Democrats' well-publicised 'decapitation strategy', moreover. The campaign was well-organised and hard-fought, and the efforts expended in some key marginals clearly paid off. There are inevitably some question-marks over Howard's future as leader, but it seems that the party has done well enough for his job to be safe for at least another year. Even his opponents recognise that further leadership turmoil at this stage would be extremely unhelpful. There is now optimism in the party that it has turned the corner and that the next election will see a return to power. However, there is still a good way to go. The party may have won more seats, but its actual share of the vote rose very little. The party needs to appeal more successfully to moderate voters, many of whom were put off by its campaigning on populist issues such as immigration. The Conservatives failed to pick up more of the protest votes that went the Liberal Democrats' way because they supported the Iraq war and have found it difficult to make hay out of the government's discomfort over the issue.
Implications for the Liberal Democrats
Rather like the Conservatives, there was much to encourage the Liberal Democrats in the results, but there was still not the breakthrough that was hoped for. The party is celebrating the likely prospect of winning the greatest number of MPs since 1929 and has clinched a number of key marginal seats. At the same time, however, it failed in its long-time ambition to eclipse the Conservatives as the second party and its seat tally has only risen by a moderate 11 at the time of writing. The party also failed to 'decapitate' the senior Conservatives, instead tending to prosper against Labour candidates. The Liberal Democrats clearly prospered over the Iraq war issue - they were the only major party to oppose it - but it risks losing these protest votes come the next election. Party leader Charles Kennedy scores strongly on the popularity stakes, but polls also find that the electorate does not view him as prime ministerial material.
Implications for the Other Parties
A number of other small parties prospered at Labour's expense, but the picture was far from uniform. The most high-profile success was for ex-Labour MP George Galloway, who won in Bethnal Green and Bow, East London. Galloway - who formed the Respect Party - was an ardent critic of the Iraq war and managed to unseat Blair loyalist Oona King. At the other end of the spectrum, the far-right British National Party (BNP) also made gains, doubling its vote in many seats. The big losers were the UK Independence Party (UKIP), which far from ruining the Conservatives' night (which had been predicted when the former did so well in the recent European elections), faded largely into obscurity. The Conservative strategy of hardly mentioning Europe during the campaign paid off. The breakaway Eurosceptic party, Veritas, also performed poorly.
Turning to the nationalist parties, in Wales there was disappointment for Plaid Cymru. It was instead the Conservatives which made progress, winning their first two seats in the principality since 1997. The Liberal Democrats also doubled their share to four. Plaid Cymru, by contrast, won one and lost one. In Scotland the situation was complicated by widespread constituency boundary changes. In general Labour clung on, but the Scottish Nationalist Party (SNP) did make some notable gains. The Liberal Democrats nonetheless celebrated winning a greater share of the vote than the nationalists. The results in Northern Ireland, meanwhile, have yet to be released. The story there will be whether the more extreme Catholic and Protestant parties, Sinn Féin and the Democratic Unionist Party (DUP), respectively, triumph at the expense of the moderates. This pattern occurred at the last Northern Ireland Assembly elections.
Implications for Legislation
The reduced Labour majority will change the atmosphere in parliament. Where previously the majority was so large that Labour could weather large backbench rebellions, now it will have to focus much more closely on the seat arithmetic. Some 50 regular rebels have been returned to parliament, and they only need a few allies to challenge the majority. The development is healthy for democracy - in the first two terms the role of parliament declined worryingly. However, this is not good news for Blair as he tries to push through controversial policies such as national ID cards and greater private-sector involvement in public services. On previous form, Blair is likely to tough it out - he will be determined not be become a lame-duck prime minister. However, if he really struggles to push through legislation, this could force him to bring forward his retirement. Some bruising confrontations are consequently in prospect.
Outlook and Implications
From a business perspective Labour's return to power is broadly reassuring. While its tendency to over-regulate and increase taxes 'by stealth' is unpopular, it has managed the economy effectively and has introduced attractive business incentives. A Conservative victory would have been no disaster, but it would have meant some uncertainty as it found its feet. A hung parliament would have been more unwelcome still with the prospect of a deadlocked government. Labour has made few policy promises for the third term that were not already known, but it will be looked to to make good its reform policies in areas such as pensions. Chancellor Brown also needs to demonstrate that the manifesto's fiscal arithmetic is not as unrealistic as it seems.