Last Summer, the mood at party conference was jubilant. Record election success brought us 72 Members of Parliament and offered us a vast opportunity to shape national debate and grow our party further.
Yet, in the year since the election, it is the rise of Reform UK which has dominated the political agenda – despite us outnumbering them in Parliament by a factor of 14. Meanwhile, our vote share has sat stagnant at the same level since 2019, even whilst the combined Tory-Labour vote share has declined from 75% to 55%. As dissatisfaction with the status quo escalates, our electoral platform has clearly lacked a sufficiently bold vision to represent a serious political alternative.
To grow our party further, our policy platform needs to achieve three objectives. First, it must speak to the whole electorate, focussing on national priorities rather than those of voters in a small number of seats. Second, our party should embrace the radicalism needed to earn us the attention of the media and match the scale of public dissatisfaction with the status quo. Third, we must remain true to our distinct identity: blending human freedom with social justice, internationalism with localism, liberalism with social democracy.
A new platform
In his 2019 campaign for the Tory leadership, Rory Stewart declared that “the centre ground must not be simply the midpoint of the stick, whose only merit is being as far away as possible from each extreme”. Instead, the centre can succeed by “harnessing the tension of two opposing forces”: mixing policies from both sides of the political spectrum. This is the path the Liberal Democrats must adopt, embracing a new radicalism which transcends the established political divide.
Take the issue of rising child poverty – the most morally unacceptable consequence of inequality – where Labour’s conspicuous inaction over the two-child benefit cap has left a political opening. Our party has committed to repealing the two-child limit, but why not go further to outflank Labour on the left? There are 14 million children in the UK: we could consolidate existing child benefits into a single, universal, far higher benefit of £100 per week – for an additional £40bn. That is roughly 10% of our current welfare spend and could be funded, for example, by reducing the number of VAT exemptions to the OECD average. This policy is not only socially just but economically liberal, since removing VAT exemptions promotes economic efficiency, whilst universal cash benefits are fairly non-distortionary and avoid ‘perverse incentives’.
Borrowing now from the political Right, the Liberal Democrats should renew the cause of lower, simpler, fairer taxes. We should campaign to clarify multiple taxes on income – National Insurance Contributions and Income Tax – into one simplified levy with a new top marginal rate of 50%. Our National Insurance system is not only outdated and inefficient but unfair too, with landlords paying nothing on their rental income whilst those earning as little as £9100 per annum are forced to contribute. Creating one simplified income tax with a more stable marginal rate would also have the happy consequence of incentivising work and boosting growth. Other pro-growth tax reforms include introducing a Land Value Tax to replace Stamp Duty and Business Rates, reforming Council Tax into a Local Income Tax, or lowering and simplifying Corporation Tax.
Third, for a policy with increasing support across the political spectrum, why not finally embrace radical planning reform to build the millions of homes we desperately need? Precisely because of our inability to build homes, the median rent in London absorbs almost 40% of the median renter’s income. Moreover, the impacts of the housing shortage are felt most by the worst off: for those earning the bottom third of incomes in London, a median-priced home costs over twenty years of income. The Lib Dems could campaign to repeal the restrictive Town and Country Planning Acts and introduce a new zoning system – as works well in countries like Japan – liberalising the market for a progressive cause.
These three policies are simply illustrative of what a bold Lib Dem policy platform might look like: outflanking the establishment on the left and right simultaneously, advocating policies that match the scale of today’s challenges, blending economic freedom with social justice. Current policies, meanwhile, like abolishing Ofwat, will never galvanise millions of voters to support us at the next general election. Currently, our sole significant policies are rejoining the EU and constitutional reform – both crucial but alone insufficient to excite the electorate.
What the Liberal Democrats need is a radical policy platform which can fight for votes across the entire country, otherwise we shall remain mired in electoral stagnation.
This article was originally written for Liberal Democrat Voice. You can find the link here