100 Days Later

General Election Result 2010:

• CON 36%
• LAB 29%
• LD 23%

Today’s Polls:

ComRes/Mirror/GMTV:

• CON 39%(nc)
• LAB 33%(nc)
• LDEM 15%(-1)

YouGov/Sun:

• CON 42%(nc)
• LAB 37%(nc)
• LD 14%(+1)

ICM/Guardian:

• CON 37%(-1)
• LAB 37%(+3)
• LDEM 18%(-1)

According to Ipsos MORI, David Cameron’s Coalition Government is currently the second most popular post-election administration since polling began. This is after Tony Blair, who enjoyed a honeymoon period which seemed to last longer than most marriages.

It is an incredible achievement. Despite the ‘dead man walking’ persona of Gordon Brown over the last few years, David Cameron struggled to secure any great enthusiasm in the country for his Party, as witnessed at the ballot box on May 6^th. But despite diametric policy views on issues such as constitutional reform, Cameron clearly sees Deputy Prime Minister and Liberal Democrat Leader Nick Clegg as a man he can do business with. The feeling is mutual and it is a world away from the open warfare between Blair, Brown and their henchmen. The result is a country appreciating the political stability which has ensued and relieved that the bickering of the past few years has come to an end – despite the unease at the severity of the spending cuts.

The UK may not be blown away by Cameron, but at least the Government now appears competent and highly focused. Most of all, it appears in charge.  It clearly has the reduction of the deficit as its main priority, followed by fundamental reform of the way in which decisions are taken, with power moving from the state to local people.

This brief note covers those early achievements but also reflects on the pressures the new Government is likely to face.

Hitting the Ground Running

The first non-botched reshuffle in several years saw Cameron offering nearly half of the Liberal Democrat Parliamentary Party jobs in the Government. This was important as it bound them to the coalition agreement via collective responsibility.  That agreement was produced incredibly quickly and showed an early focus on the key issues, as well as a firm grip on the civil service.  This was critical, especially considering the threat of 25% cuts to Government Departments. The agreement led to a Queen’s Speech which was legislatively heavy, though its 18 month tenure accounts for some of that weight.

Using the Honeymoon Period Wisely

Getting the bad news out early is not an unusual political manoeuvre. George Osborne’s promise to have an emergency Budget within 50 days of the new Government was not just about a perceived economic necessity. It was also about politics and ensuring that the news of the deficit reduction plan would be broken as quickly as possible. Osborne had been the political uncertainty of the Tory party before the election, but he established himself during the campaign and any speculation that he would be moved once within Government quickly evaporated. His Budget was well received, especially within the Party. His next big test will be the Comprehensive Spending Review on 20^th October, when more details of the Government’s priorities on spending cuts will be revealed.

The honeymoon period helped absorb the potential fallout of the resignation of one its most senior Government members, just days into office. David Laws MP became embroiled in the expenses scandal and was a major scalp for the Daily Telegraph. It would have been a full-on crisis for the Labour Party in its last few months of office but with public goodwill at the highest it is ever likely to be, Cameron and Clegg were able to manage the situation without any long-standing damage to their Government.

Stresses on the Coalition

Gaffes

It has not all been plain sailing, of course. More problematic for the Government than Laws’ resignation was the mishandling of cuts to the school building programme by Michael Gove MP, who had been seen as a safe pair of hands. His reaction was honourable with a full apology to the House of Commons, but his stock – and therefore the credibility of the Conservatives’ commitment to an area of policy which they need to ‘detoxify’ from their last period of office is damaged.  Another early problem for the Coalition came courtesy of Health Minister Anne Milton MP, whose career went from full cream to semi-skimmed when she raised the ogre of the ‘Tory milk snatcher’ in a misjudged letter to her Scottish counterpart.  She survived, but the political ineptitude resonated upward to her boss, Secretary of State Andrew Lansley MP, who got the blame for taking his eye off the ball.

Policy

Outside of the Treasury, it has been Lansley’s team which has been burning the midnight oil, producing a Health Bill which will abolish primary care trusts. Its approach of giving spending powers directly to GPs is almost entirely untested. In Opposition, Cameron made a point of criticising Labour for unworkable policies which were poorly researched, but the Shadow Health Secretary Andy Burnham MP was quick to criticize the Government for a lack of consultation. At a recent seminar in Westminster, David Furness, Head of Strategic Development at the Social Market Foundation made the point that the NHS managers who are likely to be made redundant due to the reforms may well simply be re-employed by GPs to manage the money that will go to them. This will be an early test, not only in the Government’s ability to reform, but also to make real savings rather than move money from one part of the accounting sheets to another.

A pledge to hold a referendum on voting reform was a critical part of the Coalition’s inception. Ironically, if anything is likely to terminally damage the coalition, it is that same policy. First, as Professor Robert Hazel, Head of Government and the Constitution at UCL recently pointed out, the coalition is likely to lose it. Timing is everything in politics and this – the first referendum in the UK since the poll on devolution and the first in England since the 1970s, will take place when tens of thousands of people are likely to be losing their jobs due to the spending cuts. Second, if there is one thing the public despise, it is politicians looking inwards and preoccupying themselves with the mechanics of politics. This is likely to jar badly with public opinion at a time when the popularity of the coalition is likely to be most tested.  Third, the stability mentioned at the beginning of this note might be challenged when a public unused to referendums see their Prime Minister and Deputy Prime Minister supporting entirely different outcomes.

Falling Support

Although most of today’s in depth polling still shows support for the deficit reduction programme, grass roots support for the Liberal Democrats has plummeted. In one poll today, they are at 14% compared to 23% at the election. This stress will fuel the fire of those in that Party who are not naturally supportive of a Coalition with the Conservatives, such as Simon Hughes MP. The clever political move of having so many Liberal Democrats in Government only goes as far as their loyalty to the operation. If the referendum fails badly, and reaction to the spending cuts starts damaging their strong base in local Government, then that is when their mettle will be most tested.  The Liberal Democrats are frequently witnessed holding aloft posters proclaiming ‘Winning Here’ during local election campaigns. They may find that opposition jaunts of ‘Cutting Here’ not so politically fortuitous.

Labour Regaining Its Focus and Popularity

Today’s Guardian poll has Labour in equal position to the Conservatives. Their new Leader will provide a welcome and timely focus and allow the Party to launch a full attack on the CSR in October.  Labour will also be quick to target those women voters who supported Cameron or Clegg in May. A House of Commons Library study, on behalf of Yvette Cooper, the Shadow Welfare Secretary showed that the Budget will disproportionately hit women with 70% of the revenue raised from direct tax and benefit changes coming from female taxpayers.

Spin to Win

The recent Ipsos MORI poll also shows that ten per cent more of the electorate have heard of ‘The Big Society’ since the election.  The idea bombed during the campaign and even now, understanding of the policy is only just past 50%. Cameron’s team have been quietly regrouping to ensure that it once again becomes a central plank of their reforms but with so  much reform, new Bills and drip, drip announcements of spending cuts, the Coalition press operation is already getting stretched. We understand that the depletion of the ‘media’ special advisers promised before the campaign is now under review and new appointments may ensue.

So it has been a strong start for the Coalition, which has focussed on the main concern of the country – the deficit.  But the ship is barely out of the harbour and if today’s Guardian poll is correct, Labour may be becoming just as effective in its new day job as the Official Opposition. Fleishman-Hillard will keep you fully informed with further notes as we move toward the CSR – and beyond.

First 100 Days by Department

Treasury

• Emergency Budget held on 22nd June includes raising VAT to 20% from January 2011 and public sector pay freeze.
• Established an Office of Budget Responsibility and introduce legislation to block next year’s 1% rise in NI contributions by employers.
• Financial Reform Bill will shift responsibility for regulation of the banking system from the Financial Services Authority to the Bank of England.
• Equitable Life Payments Scheme Bill will secure compensation for nearly a million policyholders hit by the near collapse of the insurer Equitable Life.
• Terrorist Asset Freezing Bill will expand scope of existing legislation to cover new organisations thought to present threat to security.
• Announced a Comprehensive Spending Review will take place on 20th October.

Deputy Prime Minister

• A bill will also be introduced for a referendum on changing the voting system to the Alternative Vote in May 2011.
• Parliamentary Reform Bill will introduce measures to establish fixed-term elections for Parliament, held every five years.
• Constituents will be given the right to “recall” corrupt MPs between elections and the number of MPs will be reduced by about 50.

Foreign Office

• Foreign Secretary announced change in foreign policy direction and called on Britain to bolster links with emerging economies such as Brazil, India and China, and with “increasingly significant economies” like Turkey and Indonesia.
• Government also expressed a desire to build stronger ties with emerging nations in South-East Asia, Latin America, the Gulf and Africa.
• European Union Bill will mean a referendum must be held to approve any future treaties handing powers to the European Union.

Health

• The Queens Speech included a new Health Bill focused on creating a patient led NHS focused on outcomes and to deliver on the commitment to reduce bureaucracy.
• Lansley delivered on his pledge to cut the number of quangos, producing plans to axe half of the existing health organisations. The Health Protection Agency, National Patient Safety Agency and Human Fertilisation and Embryology Authority will all go.
• Axed two of Labour’s key NHS targets – the right of patients to see a family doctor within 48 hours and the 18-week target covering the period from hospital referral to start of treatment. The A&E four hour wait target was also removed.
• Publication of the Health White Paper was originally delayed after the Treasury raised concerns about the level of oversight built into plans to devolve £80bn of health budgets to GPs. Lansley eventually won the battle and the support of the PM.
• The White Paper was bold – announcing plans to abolish PCTs and SHAs and move every NHS organisation to Foundation status. GP consortia and a new NHS Commissioning Board will take on commissioning roles. Local authorities will play a far greater role in improving public health. The pharmaceutical sector faces the introduction of value-based pricing.
• Lansley has thus far managed to negotiate fairly well the delicate line between sticking to the promised moratorium on local NHS closures, ensuring efficiency savings and empowering local NHS decision-makers. But a number of NHS London executives have already resigned in protest at this approach and pressure will continue to build.
• When NICE recommended minimum pricing for alcohol, Lansley poured cold water on the suggestion. “It is not clear that the research examines specifically the regressive effect on low income families…or proves conclusively that it is the best way to impact price in order to impact demand.” But only weeks later the Prime Minister was giving his full support to a Manchester-based scheme which aimed to do just that.

Justice

• Freedom (Great Repeal) Bill will limit the amount of time that DNA profiles of innocent people can be held on national database, tighten regulation on the use of CCTV cameras and remove limits on right to peaceful protest.
• The Justice Secretary also outlined proposals for prison reform and to introduce a ‘rehabilitation revolution’ that will pay independent providers to reduce reoffending. This will be paid for by the savings this new approach will generate within the criminal justice system.
• There will also be a full review of sentencing policy to ensure that it is effective in deterring crime, protecting the public, punishing offenders and cutting reoffending.
• Fundamental review of Legal Aid to make it work more efficiently.

Home Office

• Announced plans for directly elected Police Commissioners.
• The Police Reform and Social Responsibility Bill will also give the police more power to deal with alcohol-related violence and ban sale of below cost price alcohol.
• Identity Documents Bill will scrap identity cards and National Identity Register and cancel the next generation of biometric passports.
• The Government will also establish a dedicated border police force, as part of a refocused Serious and Organised Crime Agency.
• Capping the number of non-EU economic migrants allowed to work in UK.

Business, Innovation and Skills

• Postal Services Bill will allow injection of private capital into the Royal Mail, address its pension deficit, guarantee the post office network remains in public hands and seek to improve staff relations with management.
• Promote small business procurement, in particular by introducing an aspiration that 25% of government contracts should be awarded to small and medium-sized businesses and by publishing government tenders in full online and free of charge.

• Reform the corporate tax system by simplifying reliefs and allowances, and tackling avoidance, in order to reduce headline rates.
• Review employment and workplace laws, for employers and employees, to ensure they maximise flexibility for both parties while protecting fairness and providing the competitive environment required for enterprise to thrive.

Department for Energy and Climate Change

• Energy and Green Economy Bill will promote enhanced energy efficiency, including the roll-out of smart meters.
• Government will cut government carbon emissions by 10% in the next year.
• Create a green investment bank.
• Retain energy performance certificates while scrapping Home Information Packs.
• Introduce measures to encourage marine energy.
• Establish an emissions performance standard that will prevent coal-fired power stations being built unless they are equipped with sufficient carbon capture and storage to meet the emissions performance standard.
• Cancel the third runway at Heathrow and refuse permission for additional runways at Gatwick and Stansted.
• Air Passenger Duty will also be replaced with a per-flight duty.
• Through the ‘Green Deal’, we will encourage home energy efficiency improvements paid for by savings from energy bills. Measures will also be taken to improve energy efficiency in businesses and public sector buildings.
• Energy markets will also be reformed to deliver security of supply and investment in low carbon energy, and ensure fair competition including a review of the role of Ofgem.
• Ofgem will also be instructed to establish a security guarantee of energy supplies.
• An Annual Energy Statement to Parliament will set strategic energy policy and guide investment.
• An offshore electricity grid will be set up in order to support the development of a new generation of offshore wind power.

Work &Amp; Pensions

• Welfare Reform Bill will create a single welfare-to-work programme and make benefit payments more conditional on willingness to accept work.
• Announced plans to use credit rating firms to investigate people fraudulently claiming benefits to check spending on things like bills and credit cards and help cut fraud of £1.5bn a year.
• Ensure that Jobseeker’s Allowance claimants facing the most significant barriers to work are referred to the new welfare to work programme immediately, not after 12 months as is currently the case.
• Realign contracts with welfare to work service providers to reflect more closely the results they achieve in getting people back into work.

Education

• Academies Bill will give more schools in England, including primary schools, the freedom to become academies allowing them to opt out of local authority control.
• Parents, teachers, charities and local communities will get the chance to set up new schools, as part of plans to allow new providers to enter the state school system in response to parental demand.

Communities & Local Government

• Decentralism and Localism Bill will give councils more powers over housing and planning decisions and begin a review of local government finance.
• Scrapped Regional Development Agencies (except London) and called on local authorities to set up Local Enterprise Partnerships.
• Public Bodies Bill will abolish a number of non-department government bodies and limit the powers of other quangos.
• Stopped the creation of single-tier councils in Exeter and Norwich. By-elections being held on 9th September.

Transport

• Airport Economic Regulation Bill includes measures to increase the competitiveness of UK airports , having ruled out new runways in the South-East of England.
• Looking at options around the construction of a high-speed rail line.
• Work towards the introduction of a new system of HGV road user charging to ensure a fairer arrangement for UK hauliers.
• Stop central government funding for new fixed speed cameras and switch to more effective ways of making our roads safer, including authorising ‘drugalyser’ technology.

International Development

• Committed to raise spending on overseas aid by 2013.
• Use the aid budget to support the development of local democratic institutions, civil society groups, the media and enterprise; and support efforts to tackle corruption.
• Introduce full transparency in aid and publish details of all UK aid spending online.

DEFRA

• Reduce the regulatory burden on farmers by moving to a risk-based system of regulation, and develop a system of extra support for hill farmers.
• Investigate ways to share with livestock keepers the responsibility for preparing for and dealing with outbreaks of disease.

Scotland

• Scotland Bill will grant the Scottish Parliament more powers over taxation and borrowing under proposals made by the Calman Commission.

Culture, Olympics, Media &Amp; Sport

• Introduce measures to ensure the rapid roll-out of superfast broadband across the country.
  

• Partnerships between local newspapers, radio and television stations will be allowed to promote a strong and diverse local media industry.
  

Cabinet Office

• Launched Big Society programme to empower civil society and local communities.
• Opening up government procurement and reduce costs; and publish government ICT contracts online.
• Creating a level playing field for open-source software and enable large ICT projects to be split into smaller components.
• Require full, online disclosure of all central government spending and contracts over £25,000.
• Creating a new ‘right to data’ so that government-held datasets can be requested and used by the public, and then published on a regular basis.
• Ensure that all data published by public bodies is published in an open and standardised format, so that it can be used easily and with minimal cost by third parties.

Defence

• The Defence Secretary Dr Liam Fox MP has embarked on a Strategic Defence and Security Review to decide the future shape and role of the Armed Forces. Fox announced in early May that the first defence review in 13 years was to ‘begin immediately’.
• The timescale for the review is very compressed, with publication expected in October or November this year.
• With the need to find savings of 10 to 20 per cent, Ministers and defence staff expect significant reductions in armed forces numbers, including potential cuts to Britain’s land forces from eight to five brigades, in a restructuring option that would hand the army operational command of the Royal Marines – negotiations are already raising tensions between the services.
• The Defence Secretary has given details of his strategy for reforming the MOD which will include the setting up of the Defence Reform Unit that will lead in the reorganisation of the Ministry of Defence into three ‘strategic pillars’.
• The full review into how the MOD is run and how the Armed Forces can be reformed to ‘produce more efficient provision of defence capability, and generation and sustainment of operations’ will be led by Lord Levene.
• The debate over Britain’s independent nuclear deterrent has caused considerable strain between MOD and HMT, with Chancellor George Osborne saying in late July that there was nothing ‘special’ about defence as he publicly confirmed that the MOD would carry the full £20bn costs of renewing the Trident nuclear deterrent.
• The National Security Council
  

  (NSC), chaired by the Prime Minister will bring together the heads of all relevant departments and is a marked change in Britain’s security architecture at the heart of government.

And finally – 100 Days is a long time in politics…

Chris Huhne 18^th March:

“William Hague is not fit for any role in Government, let alone that of Foreign Secretary.”

Vince Cable 2^nd May:

“A vote for David Cameron is not one for fairness and change. It’s a vote for more of the same.”

Vince Cable 23^rd April:

“The worst possible action is the Tory proposal to pull out the drip-feed when the patient is still in a critical condition.”

Danny Alexander 13^th April:

“When the Tories say we’re all in this together, what they really mean is you’re on your own”.

Nick Clegg 8^th April:

“Every Scottish person knows from the Poll Tax that you cannot trust the Conservatives on tax.”

Julia Goldsworthy 31^st March:

“The ‘Big Society Day’ is just patronising nonsense.”