A Grand Coalition: Labour and Conservative

by George Hatjoullis

According to the polls, no party will get an outright majority. From the statements made in the campaign there is no coalition arrangement that would be both feasible and possible. There will be a minority government reliant on a case-by-case basis on agreement with smaller parties. This can work and has many advantages but it may leave the UK hostage to what will almost certainly be the largest third-party; the SNP. The alternative is of course a Grand Coalition between the Labour and Conservative parties.

These two parties will receive about 2/3 of votes cast and about 88% of the seats. No one can say such a coalition would not be representative of the people. It certainly fulfils the desire for pluralism as these two parties represent all groups to some extent. The big issue is could these two parties work together? There would be groups in both parties that would rebel. However the size of the combined party would mean that a majority is assured. There would be defections to other parties, notably from Conservatives to UKip. This is a powerful reason for the Conservative Party not to enter such a coalition. However, it is interesting to look at the main policy issues and consider whether such a Grand Coalition could work.

Nationalism

Nationalism is the big issue for minority groups. Scottish Nationalism is a big issue for the Scots and ‘UK Nationalism’ (?) the big issue for UKip and some Conservatives and Unionists. Most of the UK would rather Scotland stayed in the Union or frankly do not care (judging by polls). The position of both Labour and Tory leadership is unequivocally to keep the Union. So a Grand Coalition would have no problem nullifying the SNP.

The question of the UK in the EU is much more complicated. Polls have the for-and-against exit from the EU quite balanced. Moreover, the polls quickly swing against exit if there has been repatriation of powers. Both parties pay lip service to this except that the CP has promised a referendum, whilst Labour has not. The Tory leadership are not really anti-EU but must appease the UKip inclined that are still voting Conservative. A Grand Coalition would give them a great excuse to dodge this bullet whilst feigning indignation.

Immigration

The EU nationalism issue is for most people conflated with immigration. If immigration could be removed from the debate then no one would much concern themselves with ‘Brexit’. However, it cannot be removed because the EU is essentially a single market and this means free movement. This is not going to change. The response of Labour and the CP is to promise to make the move less comfortable for potential ‘migrants’, through restricting welfare and in-work benefits. They will have no problem coming to an agreement on this issue.

EU ‘migrants’ are of course not necessarily migrants. This would only be the case if they applied for British Citizenship. They need not do so as they can work in the UK without doing so. The ‘wave of migration’ fear, perpetuated by UKip, is a sleight of mind. The people coming here to work may well return to their country of origin in due course and without a change of citizenship. The strong inward flow of workers that we have experienced since 2010 should not be extrapolated. This was an unusual period in which the countries of the eurozone experienced high levels of unemployment and the UK had strong employment growth. Moreover, one should ask what would have happened if these EU workers had not come since, despite the ‘waves’, UK unemployment still fell appreciably? Wages might well be higher but only because there would have been labour and skill shortages. Indeed in some respects there still are such shortages.

UKip would have us believe that they would have made up the shortages through “controlled’ migration from the Commonwealth. People coming from the Commonwealth are, however, typically, immigrants. They do acquire British Citizenship and are unlikely to return to their country of origin. UKip thus seeks to replace potentially temporary and reversible labour flows from the EU, that will vary with economic conditions, with permanent migration from the Commonwealth. If economic conditions vary and favour other EU member states, UK citizens can take advantage and work in these countries. Moreover, many EU citizens will leave the UK in pursuit of these jobs. They do not have to emigrate and change citizenship. It is not so easy for UK Citizens to move to Commonwealth countries. I am not sure many UKip and CP voters have thought this through. In a Grand Coalition, when the perceived need to pander to Xenophobia and outright racism is eliminated, perhaps this point and its full ramifications can be made more apparent?

NHS

Both the LP and CP are committed to the NHS. There is no dispute in principle just on details. No reason that they cannot co-operate on this issue.

Housing

Both are equally inept on this issue. The CP has been busy subsidising buyers in a market with excess demand. This policy is simply nuts as it just drives up prices. All the LP has suggested is rent controls. There is a case for regulating the housing sector as a ‘utility’ because, if there is structural excess demand, then the price behaviour starts to resemble a natural monopoly. This is socially as undesirable as water companies blackmailing the population with extortionate water charges. The solution is of course to remove the structural excess demand by building more affordable and social housing. Neither has suggested that they will do this and may not do so in coalition. This issue is unlikely to be resolved in a GC. However, this is irrelevant. This subject will not cause much conflict within the coalition as they are equally indifferent and inept.

Education

I cannot imagine this will throw up much conflict. Again the differences seem to be in detail and amenable to compromise.

Welfare

This should in principle be a huge source of conflict. The CP has crushed welfare payments to make being employed the preferred option of all. The LP has not made any dramatic promises on welfare spending in order not to sound profligate. Perhaps in coalition they could find something to argue about but again it seems likely to be detail rather than principle.

Fiscal Policy

The CP is supposedly the party of prudence and low taxes. It is the party of personal responsibility and choice. it is the party of small government. The LP is supposedly the opposite. There is much scope for disagreement in principle in this category. In practice, it is hard to spot the difference. Once again a GC can find compromise.

My conclusion is that Grand Coalition is workable. Problems may lie in personalities rather than policies. Moreover, it could cause splits in the two main parties which might irrevocably change the party structure of UK politics. This could turn out to be bad in the long run but no one can say for certain. It would be a worthwhile experiment, albeit with some risk. It might certainly be preferable to a minority government held hostage by minority parties as this would require much more profound and hence dangerous compromise.

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