No one is viewing next May’s general election with enthusiasm. The widespread expectation is of either an inconclusive result or a government without much authority.
Yet the problems which ministers face will remain serious: how to reduce the budget deficit even further after five years of austerity and how to reshape the delivery of public services, while also addressing longer-term issues of energy supply and infrastructure, let alone reviewing Britain’s relations with the European Union and the relations between the nations in the UK. The Institute for Government has developed views on how a new government should address these questions, notably in A Progamme for Effective Government which we published in mid-September and discussed at the autumn party conferences and at a series of events at 2 Carlton Gardens. The underlying theme was the need for realism and candour about the long-term challenges. In particular, the IfG’s work has shown how the UK is moving from the familiar model of a centralised state where a single party has all power through a winner take-all electoral system to a more complicated pattern where power is shared. This applies geographically as we move towards a quasi-federal state whose constituent nations and regions have increasing power over public spending, and in some cases taxes. The response to the Scottish referendum result, or rather to the campaign and the passions it released, has permanently shifted the balance between London and Edinburgh. All the main parties are committed to further legislation as a post-election priority. There are parallel and, still unresolved, devolution debates in Wales and Northern Ireland, and all parties are committed to decentralising more control over spending in England. The sharing power theme also applies centrally. Since May 2010, majoritarianism has been superseded by a sharing of power between the Conservatives and the Liberal Democrats, though not all their supporters have accepted the implications of having to limit their ambitions. If no single party wins a majority in May, the parties will again have to share power and to accept constraints, whether through another coalition or, perhaps as likely, through a minority government when the focus will shift to deals done in Parliament. Either way, there will have to be a different pattern of politics, of expectations, behaviour and conduct. The other key challenge is the spending review and its implications for the shape of public services. There are big differences between the parties on the scale of further cuts, but not on the need for them to reduce the deficit throughout the next parliament. The real question, as the Institute has pointed out, is the different one of how to reshape the delivery of public services. It has been possible to squeeze out a lot of money after the big rises in expenditure between 2000-2010, partly through holding down pay and other administrative costs. These savings have, so far, mainly been achieved without a visible impact on standards of provision—though there have already been exceptions in social services and criminal justice. But that overall picture is likely to change from now on; simply demanding less or further installments of ‘salami slice’ cuts is no longer feasible without affecting levels of provision. That demands a different type of spending review. A key test will be whether the Treasury recognises that a different, more cross-cutting approach is needed. This will put a lot of onus on finding new methods of provision, both centrally and locally, and notably through a big expansion of digital services. The Institute for Government is instinctively part of the keep calm school. It may be tough but there is no need to panic at the prospect of political, constitutional and economic upheaval ahead. Plenty of countries have managed with a minority government. The fiscal outlook could be a stimulus to innovation rather than another course of fudge. This puts a responsibility on both the Civil Service and on the parties: on the Civil Service to prepare a wide range of options, not just the conventional ones, for any new government; and on the politicians not to make unrealistic and unachievable commitments ahead of the election, and, after May, to allow time to consider, discuss and make decisions on these long-term challenges.