David Cameron’s prospects for victory in 2015 can’t be guaranteed

As they head for their holidays, senior Conservatives are beginning to worry
that they are failing to benefit fully from Britain’s economic recovery.
Recent months have seen a succession of good news stories, with growth well
established, living standards no longer falling and predictions of future
performance regularly upgraded. Yet the Tories seem unable to overturn
Labour’s narrow lead.

The table below illustrates what has happened. It compares YouGov’s current
figures, drawn mainly from our latest poll for the Sunday Times, with the
same findings two years ago, when Britain was still mired in recession. On
every indicator other than voting intention, there has been a sharp move in
the Conservatives’ direction – yet support for the party is up only two
points:

Datatable: July/August 2012/2014

These figures revive uncomfortable memories of the 1990s. Leading Tories have
been hoping that the coming general election would be a rerun of 1992, when
fears about the economic impact of a Labour government drove people to vote
Conservative in record numbers, despite the fact that Britain was only
beginning to recover from the 1990-1 recession. Instead, could next year’s
election be more like 1997, when the Tories lost power despite presiding
over four years of steady growth, low inflation and rising living standards?

I expect next year’s election to be different from both 1992 and 1997. Here
are three distinct features of what is happening today:

• The Conservatives have never sunk as low this time as they did in the
1987-92 and 1992-97 parliaments. They (almost) won the 2010 election with 37
per cent of the vote. What is striking is that by 2012, at the point in the
electoral cycle when governments are normally at their least popular, they
had lost only four points – despite missing badly all their early targets
for economic growth and deficit reduction. The main reason for this is that
David Cameron and George Osborne succeeded in pinning the blame for our
economic woes on Labour. Having lost relatively little support, the
Conservatives had fewer potential deserters to win back than most past
governments.

• That said, their tiny, two point gain, from 33 per cent to 35 per cent,
masks two other factors. The first is that Labour’s support is down five
points, so the gap between the two main parties has narrowed sharply, from
10 points to three. The second is that the Tory recovery has been inhibited
by the four point increase in support for Ukip. Around half of Ukip’s
support comes from people who voted Conservative in 2010. The Tories can’t
be happy that their party has proved so vulnerable to Nigel Farage’s brand
of populism; on the other hand, if they can squeeze Ukip’s support next May
– and YouGov polling at the time of the European parliament election
campaign suggests they can, especially in Conservative-Labour marginals –
then the Tories could end up with support of 37-38 per cent in next year’s
election. This would be enough to make them the largest party once again,
though not enough to give them outright victory.

• Even though Britain’s gross domestic product has recovered to pre-recession
levels, living standards have not. Our population has grown, so the same
national economic cake has to be shared among more people, with the result
that most of us have a little less each. And while the mood of despair may
have begun to disperse, pessimists still outnumber optimists when people are
asked what they expect to be better or worse off in 12 months’ time. Labour
has made some headway with the argument that the current coalition will be
the first Government in recent times to fight an election when average
living standards are lower than when it was first elected.

If I were a Conservative strategist, the historic parallel that I would study
with care is neither 1992 nor 1997, but 1979. The previous summer (that is,
at the same point in the electoral cycle as we are now), the Government
seemed to be on course for re-election. Like the current one, it was
presiding over a marked recovery from the tough economic conditions it had
inherited. It had a Prime Minister who was far more popular than the main
opposition leader. The Liberals were seeking to extricate themselves from
their links with the Government and reassert their independence. The
opposition’s large polling lead had evaporated.

In those days, when prime ministers could choose when to dissolve Parliament,
an election in autumn 1978 was widely expected. But the prime minister,
Labour’s James Callaghan, decided against the idea. He wasn’t sure that
Labour could yet win outright. He expected the recovery to continue and do
deliver enough votes to give Labour a clear victory.

Instead Callaghan reaped a peculiarly vicious whirlwind. A mammoth bust-up
between Labour and the unions led to the Winter of Discontent, with strikes
causing rubbish to pile up in the streets, bodies to remain unburied and
petrol stations to run out of fuel. The Government’s economic credibility
collapsed, and voters turned decisively to the opposition leader, Margaret
Thatcher.

Normally, today’s Conservatives look back fondly at the 1979 election, and the
start of 18 years of Tory rule that transformed Britain. However, the events
leading up to it serve as a warning against prime ministerial hubris when
the economy is in the recovery ward. It can all go wrong. Perhaps Cameron
will be luckier than Callaghan and gain votes from continued economic
growth, falling support for Ukip and distrust of Labour. But perhaps he
won’t. In today’s interconnected world, trouble in one part can quickly
affect trade, jobs and investment everywhere. Consider the headlines coming
out of the Middle East, and the tensions with Russia over Ukraine. Those
conflicts could end up affecting us all, and wrecking Cameron’s hopes. His
prospects for victory next May, though real, can’t be guaranteed.

Peter Kellner is President of YouGov