19 May 2017

Labour and the Conservatives have both launched their manifestos. Bronwen Maddox examines how the two parties' pledges measure up and what they might mean for running the UK.

Overview

A year ago, the UK split itself in two at the referendum, yielding a slender majority for Brexit and launching the country on its biggest upheaval for decades. It is appropriate that in this short-notice general election the two main parties offer visions of the future that are radically different, with more division between them than they have shown for years.

The gulf between them, however, is not over Brexit itself. It could have been, but Labour decided (after untidy internal debate) to accept the verdict of the referendum and enter battle only on the question of how the UK's exit should be achieved, not whether it should at all. One of the oddities of this election, then, is that the main contest between Labour and the Conservatives is on the traditional grounds of the economy, education, health and “fairness”.

It is understandable that each wants to set out a classic agenda representing its vision for Britain. But for all the sonorous words the parties devote to Brexit in these manifestos, each fails to acknowledge the true scale of the exercise, which will dominate all other government efforts in time, cost, and impact on people’s lives.

Before these manifestos were published, the Institute for Government set out a list of five commitments which we argued any party should include: to recognise that Brexit meant being ruthless with priorities; offering detail on the conduct of Brexit itself; improving the way tax is devised; planning infrastructure better, and managing public spending. These would, in our view, strengthen the winner’s claim to have a mandate for EU negotiations and the claim to be improving the way the country is run, irrespective of political ideology.

The Conservative manifesto scores better on several of these, in clarity and detail. However, Labour has chosen to address more fully how it would approach Brexit, the issue that dominates all others. Even if it is guilty of wishful thinking on several counts, it acknowledges more directly the questions that people and businesses have about the negotiations and about life after Brexit, and goes further in answering them.

Labour also addresses more directly questions about the working of Parliament and the flaws of the House of Lords. It remains to be seen whether the emphatic but imprecise commitments the Conservatives make in their manifesto towards strengthening democracy will stand up against the temptations of a large Commons majority, if that proves to be the outcome.

Scope of government

Both manifestos start unashamedly from the view that government is best placed to fix the main problems that face the country. As the Conservative manifesto puts it: “We believe in the good government can do”; the Labour manifesto is in no doubt that the party can “build a fairer Britain” and a faster growing economy.

In an obvious sense, it would be surprising if they did not. But the Conservative manifesto does a better job of acknowledging the limits on any modern government’s power; it gives a firm nod to the forces of globalisation and technology. That is not to be mistaken for an ideological belief in smaller government (and Theresa May, with her emphasis on social justice, hardly fits that “small government” tradition within her party).

For Jeremy Corbyn’s Labour, the great foe is inequality and the opposition is “the rich”. It is a consistent vision, and as polls have shown, much of it is popular if detached from the Labour leader himself; the manifesto’s tendency, though, is to claim too much for government’s power in a world of mobile taxpayers and companies that barely recognise national boundaries.

Prioritisation

Both parties score badly on this front. Yes, that is the nature of manifestos, traditionally stuffed with something for everyone. But this time is different – or should be, because of Brexit. Each document does acknowledge the momentous nature of that exercise; Theresa May says that “The next five years are the most challenging that Britain has faced in my lifetime,” and Jeremy Corbyn that “this election is about what sort of country we want to be after Brexit.”

Yet both parties have vastly understated the impact it will have on what any government can achieve. As the IfG has argued, Theresa May’s government has been getting increasingly surefooted at describing how the processes of Brexit might be managed – but many of those will require more people, money and time than currently appears available.

To put this in perspective: the new spending commitments in Labour’s manifesto amount to nearly £50 billion a year. That is of the same order as the supposed “exit bill” (although that would be a one-off). But Brexit will also bring costs of creating new agencies, customs and immigration processes, and that is before considering any economic impact.

Both parties, for all the rhetoric, make too light of Brexit: in cost, in impact on the economy, in immediate effect on people’s lives – and in soaking up capacity in Whitehall and in Parliament. Trying to achieve Brexit, plus the “business as usual” agenda of battling the NHS funding crisis, the national finances and so on, as well as the new, personally-crafted agenda each party leader wants as a legacy, will be impossible. But you wouldn’t know it from these manifestos.

Brexit

Labour overstates the UK Government’s ability to control the outcome, where the Conservatives do at least acknowledge that negotiations will be tough. Labour is guilty of one particularly glaring instance of wishful thinking: baldly asserting that it will seek to retain the benefits of the Single Market without being in it. That option is simply not on offer from Brussels.

The Conservative version is more nuanced, holding that “We want to negotiate a new deep and special partnership with the EU which will allow free trade between the UK and the EU’s member states” but not claiming that this will match the benefits of the Single Market. The IfG’s publication this week on how the UK should develop its capability in trade certainly supports the Conservative aim that “we seek to replicate all existing EU free trade agreements.” They should be a priority because they represent an immediate loss for the UK as soon as Brexit is effective, while the gains from future new trade deals are hypothetical – but certainly not immediate.

However, on one of the most consequential points, Labour does firmly reject the notion of “no deal” because of the damage it believes this would do. In contrast, the Conservative manifesto repeats the Prime Minister’s assertion that “no deal is better than a bad deal”. Given the disruption that “no deal” inescapably would present, the onus should be on any party considering that option to set out clearly the calculations that make it confident in that assertion. There is no sign that any economic calculations support the Conservative position.

Labour also offers a “meaningful vote” in Parliament on the deal, whereas the Conservative manifesto does not – even in the case of “no deal”.

However, both parties are almost silent on how to get from here to the point of exit, beyond Labour’s brief reference to “transitional arrangements”. The same is largely true of their policies for life after Brexit, such as for agriculture and fisheries, while they attempt an airy reassurance about continued funding for the devolved nations which will surely be met with scepticism.

Public services and spending

If there’s one routine political prescription that deserves to be buried in its own banality, it is “the need for a public conversation”, sometimes garnished with the word “honest”. Except that it’s often right – and has inescapable force in the current crisis on health and social care funding. The Conservative manifesto is more direct in acknowledging the financial constraints in an ageing population where health costs are rising roughly twice as fast as the economy is growing. It offers a controversial but clear proposal on how to get people to pay more towards their own care. Perhaps even more useful, though, is the declaration that “people are rightly sceptical of politicians who claim to have easy answers to deeply complex problems.”

This is the beginning of the necessary “conversation”, even if it has something of a dictatorial quality, essentially telling people they can’t have everything they have come to expect. Yet this is a problem that politicians of all parties have been able to see coming for a quarter of a century; the issue is one of arithmetic not ideology. Parties need to find a way to make the solutions less politically toxic and more accessible; the IfG has suggested creating an independent body, like the Office for Budget Responsibility, to scrutinise public spending.

Tax

The parties’ ideological differences are most stark when it comes to tax – who should pay it and at what rate. That aside, neither is radical or convincing on how to combat some of the technical problems in collecting tax common to modern, open democracies: such as whether it is becoming impossible to levy corporation tax in any systematic way (or at all, when companies straddling many national borders simply choose where to declare profits). Labour’s pledge to give HMRC more money might solve other problems – but not this one, as it claims to do. 

The Conservative comment that tax is too complex and pledge that “We will simplify the tax system” is welcome; the authors had the wit to leave the statement at that. Voters might be forgiven for feeling they had heard this before, however, and the proof will be in any achievement.

Infrastructure

Lots of it, says Labour, proposing spending of £250 billion over a decade. The Labour manifesto essentially takes it as given that infrastructure spending is always good. True, there is considerable agreement since the 2008 crisis that in an era of persistently low interest rates, this is often a good use of national finances, but all the same, an acknowledgement that there is such a thing as a white elephant would be welcome. Neither party has a good and systematic answer to where and why it intends to direct such spending.

The Conservative manifesto should be welcomed for acknowledging that the wrong deals can make transport and utilities too expensive for consumers and businesses, noting that “the wrong regulatory frameworks can over-reward investors for the risk they are taking”. Yet it has contradicted those principles in practice (providing yet more rich examples for the IfG’s ongoing work on the flaws of policy making in this area). Most glaringly, Theresa May’s government upheld David Cameron’s decision to build the Hinkley Point nuclear power station, which will lock Britain into some of the world’s most expensive electricity.  The manifesto also makes a commitment to a final decision on Heathrow, which is welcome given the enduring uncertainty – yet the model proposed, as airlines have pointed out, will be very expensive for them and hence for passengers.

House of Lords

Labour offers an entirely clear policy, saying that it backs an elected second chamber. The Conservative manifesto says coyly only that it will address questions of the chamber’s current size (it is to be presumed this does not mean making it even bigger, although David Cameron, on leaving office, did just that).

Running a divided country

Stepping back from the detail of the rival prescriptions, it is fair to ask how the manifestos each answer the political problem that is the legacy of the referendum: how to govern a divided country.

May has attempted this most directly, reaching across the aisle with the anti-metropolitan blend of hard right (immigration capped at tens of thousands) and left (talking of “burning injustices” and “the cult of selfish individualism’) that has become her hallmark. Like her deliberately vestigial signature on the first page of the manifesto – merely a gesture of a T, an M and a Y – she intends the text to stand for much more than it spells out. It also contains some plain weird declarations, such as “Conservatives believe that if you value something, you must be prepared to reform it in order to conserve it”. But although the Prime Minister decried the notion of “Mayism”, that is perverse; this is as strong and consistent a personal flavour as it’s reasonable to expect from a politician.

If the polls remain as they are now and prove right, she will be rewarded with the majority that was her goal in this gamble. But governing with a large majority and no effective opposition is not the picnic it might seem given the potential risk of opposition within her own party. The threat remains the obvious one: there was a majority in the country, just, for Brexit but not for any one version of it. When negotiations force her to make more detail clear than she has chosen to do in this manifesto, both her party and voters may look askance at her supposed mandate.  

Corbyn, in his tax and spending policies, in his call for renationalisation of key industries, and in the tone of his attack on “the rich”, has produced a more strikingly left-wing manifesto than the party has done for years. Yet shorn of Corbyn himself and the language which suffuses this document, many of the policies are popular, polls suggest. Their appeal may represent more of an enduring challenge to a May government than it might seem. But lack of faith in his competence in government holds him back, the polls also indicate. The manifesto fills in some important gaps where its Conservative counterpart chooses to be silent, but on other central points is itself unclear.

Comments

How does the Liberal Democrat manifesto fare on the criteria you employ in comparing and contrasting the Conservative and Labour offerings?

This article is badly thought out. it only thinly veils a support for a Conservative government. It only thinks in 'Brexit' terms. As an example, if the Conservatives gain power and negotiate a Brexit deal but its patently bad, will they accept it on behalf of the UK? Do we give them that kind of mandate because they get voted in? This general election is about all things in the UK and not just about Brexit. If Corbyn were to get in would it matter about Brexit because both parties are following the same line. However, individually there will be elected MPs who don't want to do that? And why, in the final paragraph it becomes Corbyn-specific and not one mention of Theresa May? She is is doing things to this country which are far from just raising taxes for 5% of the population but ...then again you... are of that ilk are you not?

I wonder when politicians will start to think about what is going to happen after the Brexit negotiations have finished? I imagine - and you have already hinted - that what happens after a "hard Brexit" will be infinitely harder and more complicated than the current election or the Brexit negotiations. Is there any sign in the current manifestos that any party is looking more than two years ahead?

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