12th April 2018
Thomas Anelay, a Senior Account Manager in the Public Affairs Team, explores how we can expect the Government to act on the issues that voters most care about.
As Parliament returns, issues polling indicates that what matters to the electorate hasn’t changed very much over the last year. Brexit, health and immigration continue to be the most salient issues to voters and therefore the ones on which election-savvy politicians will continue to focus their attention. How is the Government responding to these issues and what can we expect them to do?
To what extent should the UK seek regulatory divergence from the EU? How much European oversight should the UK expect? Should the Industrial Strategy favour certain sectors of the economy? Can Jacob Rees-Mogg and Anna Soubry’s respective wings of the party be kept on-side? What do the public really want after the UK’s departure from the EU? The knotty Brexit questions keep coming.
Individual arguments will continue to highlight the difficulty of the Government’s position. The recent award of the contract to manufacture UK passports to a French company rather than the UK-based De La Rue as well as President Donald Trump’s steel tariffs provide timely examples of the competing forces of free-trade and protectionism. This dichotomy can be expected to dominate and drive much of the Brexit debate in the UK and is likely to be a debate that will continue once the UK leaves the EU.
In terms of the actual Brexit negotiations, although the Government has managed to agree a transition deal and the Draft Withdrawal Text in March, time is pressing. The Government have also placed themselves under considerable pressure by suggesting that a trade deal will be done in the autumn. Some have argued that the Good Friday agreement could prove a useful model for the Government if they can draft a Brexit based on ideals and ambiguity. Although businesses have welcomed the political agreement in March, their demand is for legal certainty, and they may be left disappointed by a direction of travel lending itself to a “live” document full of fudges and open to subsequent amendments.
The immigration debate has, for now, been carefully placed in the hands of the experts at the Migration Advisory Committee (MAC). However, rows continue in Cabinet and there have been reports that Home Secretary Amber Rudd is unhappy with a number of the positions promoted by her predecessor, Theresa May. Meanwhile, the long-promised Immigration Bill and White Paper continue to be conspicuous by their absence, as businesses warn of shortages in skills and labour.
Against this backdrop, the argument that access to the EU labour market has contributed to slow increases in wages has gained some traction. Notably, the Treasury also has two major objectives at present – increase wages and increase productivity. There are reports that some Treasury officials are quietly pleased that we are beginning to see a change in bargaining power between employers and employees which could further those objectives. Furthermore, if the Final Report of the MAC is not wildly different from its Interim Report, the argument that businesses simply need to adapt may gain further credence and allow the government some flexibility to attempt their long-stated objective of reducing immigration.
Although many Conservative MPs (and MPs of other parties) favour some form of wholesale reform of the NHS, the political will for such a move seems to be lacking. However, the Conservative party are well aware that health remains a toxic issue with the electorate – a problem exacerbated by that fact that barely a day goes by without a think tank, health professional, or politician identifying that the NHS is in need of improvement.
A cross-party commission has long been floated as a way of reducing the political toxicity of the NHS for the Conservative party. However, to bring about such a commission would necessitate the use of enormous political capital and it is difficult to envisage the present Labour party giving up one of their major electoral advantages. Instead, it seems the Government will fall back on the relatively safe option of more funding.
The plan carved out in 2014/15 between George Osborne and the Head of the NHS, Sir Simon Stevens, allowed the Conservatives to neutralise the NHS as a Labour attack line in the 2015 election by claiming that the Conservatives had given the NHS exactly the money they had asked for. Now, Treasury officials are reportedly in advanced stages of working out a plan to be announced at the Budget under which National Insurance will be raised by a penny in the pound. Whether this will neutralise the toxicity of the NHS for the Conservatives remains to be seen. However, this also plays into a growing concern in Conservative circles – the rising overall tax burden. Such major policy announcements rarely pass smoothly.
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