Piece for Public Finance by David Lipsey 19.3.14
Who will win the 2015 general election? The pundits queue up to make confident predictions; but the truth is that no-one has a clue.
This is rare. Since the shock of Harold Wilson’s win in February 1974, every election bar one has been eminently predictable a year before polling. And the one – 1992 – was only unpredictable because (as it later turned out) the opinion polls had, for technical reasons, lost the plot.
Consider by comparison the uncertainties this time. First there are the psephological uncertainties – how the electoral system will translate votes into seats. In retrospect, the Lib Dems’ mercy killing of the coalition’s half-baked boundary redrawing may prove the decisive moment for 2015. Of the 50 seats by which it would have reduced the House of Commons, more than two thirds would have been Labour.
However, there is an offsetting factor. One of the features of recent general elections is the incumbency effect. MPs who win a seat for the first time generally do better at the next general election than the average for their party. At the 2010 general election, Tory candidates fighting as first-time incumbents saw their vote increase by 5.6% compared with 3.8% for longer standing MPs.
For an overall majority, Labour needs to gain some 67 seats. It would achieve this if it won all Tory held seats where the majority is 10% of the vote or lessIn all but three of these cases, the victor of 2010 is fighting again. So even if there is a big swing to Labour overall, it may be rewarded by less seats won than the party needs. Despite its gains from the electoral system, an overall majority is a tough target for Labour. No wonder, Ed Miliband is making sure he does not necessarily alienate the Lib Dems as possible coalition partners.
But that brings into play another psephological unknown: how the Lib Dems will fare. On their worst current poll ratings, the party’s MPs might again be able to fit into a London taxi. However, the Lib Dems have been particularly successful in establishing incumbency effects. Once they have a seat they tend to hold it, however desperate the party’s fortunes nationally. Will they repeat the trick this time? Who knows?
And then there is UKIP. That will be a sceptre haunting every party leader; but the ghost will loom even larger following the European elections this summer, where they might even be the largest party. UKIP will not capture Tory votes exclusively. It would not be surprising for example if it polled well in Northern Labour strongholds. But the point is that they are strongholds, and a high UKIP poll, as in last month’s Wythenshawe and Sale East by election, will still leave the Labour member in place. In Tory-held marginals however it is Tory votes they are likely to gather, and that may leave the MPs for those seats in peril. Hence the rampant Europhilia of the Tory backbenches.
But surely the economic recovery will see the government home? Not necessarily. In hard times people keep hold of nurse. If voters think the economy has been fixed, they may be more prepared to countenance an untried government taking office, especially if that government promises a better NHS.
I do not know who will win the election. However I do know which prediction I would least distrust– the odds offered by the bookmakers. They have money riding on it. And Ladbrokes make Labour favourites to win most seats at 4/7. The Tories are 11/8.