One chapter ends, another begins

As voters go to the polls today, unlike the last several general elections, there seems to be no doubt of the result. There is a single-minded determination from the electorate that change is needed, but the scale of that change will be hugely significant.  

That certainty and consistency of the poll lead has given Labour a significant asset – time. Time to think carefully about its approach to government, and how it plans to tackle the challenges facing it on all fronts.  

For the past two years, while the Conservatives have pursued a tactical and short-termist approach to government, Labour have been formulating plans across a range of sectors. The scale of the challenges is vast, from making the economy more productive to helping the UK transition to net zero, and from addressing the state of the UK’s critical infrastructure to delivering significantly more housebuilding.  

Our team at SEC Newgate has been examining Labour’s plan for government, and we’ll release our full analysis next week. An early look shows this will be one of the most significant elections in terms of policy change for decades, and certainly from the political left since Labour first entered government in 1997 27 years ago. 

There will be a fundamental change of approach in every sector – in transport and infrastructure, railways will be taken back into public ownership and there will be a crackdown on water companies who fail to prevent illegal discharges. In energy, there will be a new publicly owned company – Great British Energy – to invest in leading technologies and deploy local production, and there will be a change in approach to encourage more renewables.  

Labour will fundamentally revise the way the UK approaches housebuilding, reinstating local housing targets and forcing councils to regularly review green belt boundaries to ensure they are hitting their targets.  

Labour’s ‘mission-led’ approach to growth will see a new Industrial Strategy, a review of business taxation and other reliefs ahead of the budget and changing the Apprenticeship Levy amongst other reforms. 

Yet the most significant set of reforms will be Labour’s “New Deal for Working People” -rebadged in part as “Making Work Pay”. Their labour market proposals comprise no fewer than 30 areas marked out for reform, from banning “exploitative” zero hours contracts as well as measures to end “fire and rehire” practices, introducing a catalogue of codified “day one rights”, and moving towards a single worker status that differentiates workers from the genuinely self-employed.  

Labour fully intends to hit the ground running, and for the past few months has been working with civil servants through access talks to ensure their first 100 days will be used well. We can expect Parliament to sit later into the summer, with a King’s Speech on 17 July that will launch new government bills to enact some of these reforms, and a raft of consultations ahead of a significant Budget in either September or October. 

Labour will enter government with a thumping electoral mandate, with a majority of at least 150 seats – which would match 1997 - and potentially as large as 250 seats, a result that hasn’t been seen in British politics since the 1880s. Such a large majority will place greater emphasis on earlier engagement by business ‘upstream’, so that ideas and issues are fed into the policymaking process at an early stage. 

It is clear that businesses in every sector will be affected in some way, and that presents both significant opportunities as well as risks. Our team of experts stands ready to explain the impact of these reforms on your sector. 

The certainty that will come with a Labour victory will no doubt come as a relief to many after the frantic last few years. However, whilst that electoral mandate is likely to be sizeable, there is a note of caution. As Labour Leader, Keir Starmer will enter Downing Street with the lowest approval rating of any Leader of the Opposition in recent years, as voters choose change, but not perhaps an enthusiastically proactive vote in favour of Labour themselves.  

In the 1960s, only 13% of voters changed their vote from one election to the next. At this election, a whopping 60% of voters are expected to do so, and the share of the vote for the two main parties is likely to be at an historic low. Voter volatility is at an all-time high, and Labour will need to do much more to win voters over with their reforms. After all, it is only five years ago that Boris Johnson won the Conservatives their biggest majority since 1987, and they stand on the brink of their worst defeat in over 100 years.  

Labour is aware they not only have to win over voters' hearts and minds but be competent and deliver against their bold plans too.  

Change is coming. All eyes will now be on how Labour delivers it.