Understanding attitudes to the Budget
Understanding attitudes to the Budget
Some new Persuasion UK/IPPR research, or 'the public services theory of everything'
Arguably the most influential politician in recent Labour history is George Osborne.
The former Conservative Chancellor terrorised UK Labour so much between 2010 and 2015 – punching every bruise in its reputation for economic competence with constant dividing lines on spending, deficits and debt – that he practically haunts the dreams of the party’s adviser class. Those who went on to turn things around for Labour did so understandably resolving to never allow these lines of attack to prosper ever again.
During the same time period, though, a solid policy consensus was emerging in the broader centre-left eco-system: Britain is stagnating because of low productivity growth driven mostly by low levels of investment, including public investment.
It’s the push and pull between these two truths, combined with a legitimately tough inheritance, that explains a lot of the slightly angsty start to the new Labour administration. It’s also embodied in the paradoxes the government was delivered into the world pledging: stability but also change, reassurance but also reform.
This dynamic looks set to reach its noisiest point yet at this month’s Budget.
So how might the government think about navigating October 30th with voters, in policy and messaging terms? Persuasion UK and IPPR have teamed up to do some in-depth research via YouGov looking at voter attitudes, out today. The full research is here but below is a summary of what we found, with some personal reflections from me.
1. Understanding what voters will punish and reward government for most
One of the reasons parties embrace paradoxes is voters are annoying and are perfectly capable of telling you they want things that, if not directly contradictory, are at least in tension.
So we started the research with an experiment that would draw out – or reveal – key voters’ actual priorities for this Parliament.
This worked by showing survey respondents three issue outcomes, drawn randomly from a list of nine, and asking them to imagine these form the basis of this government’s record in 2029. Each outcome came with a difficult trade-off. To make it more realistic, voters saw an attack message on this record - before being asked if they would approve of a government standing for re-election on this record. In the analysis phase we can isolate the impact each outcome/trade-off had on the government’s approval rating, in absolute terms and relative to now.
Here is what we found for swing voters (switchers to Labour in 2024):
Essentially, as you can see, the government is rewarded most for improvements to the public realm (potholes, the NHS, etc) - even if it comes with unpopular downsides. They are punished the most where there is least progress here, even if it comes with popular upsides (lower debt, deficit). Their punishment on the NHS is especially notable.
You’ll see in the full research that the same pattern is true of voters at large.
What this does not mean is Labour can somehow get away with doing a Truss and causing a run on the pound if it means fixing social care.
But what it does mean is they won’t be rewarded for being good book-keepers. There is a slightly Treasury brained school of thought that if Labour just holds tight, bring some level of stability and don’t mess anything up, they will win a second term.
This is just rubbish, as far as I can see. It’s the visible signs of national decline - our crumbling roads, NHS, energy systems etc - which form the bedrock of Labour’s mandate and voter’s expectations of delivery. It misunderstands this as its peril.
Within that, economic competence is what you might call ‘table stakes’, necessary hygiene but not sufficient on its own. The salience voters put on things like debt or deficits has fallen since 2014. This may not be the case forever – opinion on this tends to be thermostatic – but it is for now.
2. Baseline attitudes to wealth tax and borrow-to-invest
In terms of the means to achieve those ends, the only real tension evident is a more prosaic one: between concern at cost of living and concern at public services.
We see this when we look at the baseline attitudes to different taxation ideas for the Budget. Support is softer for ideas more ‘proximate’ to people – i.e taxes they think may hit people like them, including reversing Hunt’s employee NI cuts.
We see the same tension when we pit ten ‘pro’ and ‘anti’ arguments in different areas and see which ones most consistently prevail. There’s more on this in the full research, including how we did it, but you can see below that arguments over-tax raising in general are very evenly contested between pro and anti narratives, whereas arguments for wealth taxation prevail far more comfortably over anti.
Broader opposing arguments – ‘this will trash the economy, hurt wealth creation’ etc – are not effective because they are not proximate enough to people’s lives, i’d argue.
It’s also this which also makes in-principle opposition to borrow-to-invest very minimal:
All of which leaves a starting position for the government on wealth taxation and changes to fiscal rules that is reasonably strong. It’s possible to win support for broader tax raising than that, but it needs to be more concertedly built than is presently the case.
3. What over-arching government narratives best sell these ideas and withstand attack?
At this point, any sceptical Labour SpAd will probably say “ok, very nice, but this is the Labour party doing all this - what happens to attitudes when the government starts getting it from all sides from a hostile press or angry business groups”.
Of particular concern here is usually the party’s hard-fought reputation for economic competence and moderation.
We set out to explore this too, at least as much as feasible. Not least as it gives us a chance to surface the most effective ‘stories’ for selling such changes.
To do so we used Randomised Control Trial (RCT) message testing. A large group of voters were told that the government is considering a package of wealth taxation increases and changes to fiscal rules to allow more borrowing-to-invest. They were then split up into six demographically identical ‘message groups’, as follows:
Group 1 saw just a random aggressive attack message on these changes, either political in nature (think ‘same old Labour, whacking up taxes and borrowing the first chance they get’, etc) or from business groups (‘these changes will hurt the economy by punishing entrepreneurs’ etc).
Group 2 saw the current Labour ‘black hole’ message for these changes – they’re necessary to fix the public finances after the last government’s profligacy – plus one of the above attack messages.
Group 3 saw a possible Labour message arguing these changes are necessary to rebuild an NHS that is on its knees and failing people - plus an attack.
Group 4 saw a similar but broader ‘rebuild Britain’ message about the public realm (roads, schools, energy infrastructure etc) – let’s fix the foundations, invest for the long term etc – plus an attack.
Group 5 saw an argument for this package of changes on the grounds of fairness: it’s reasonable to ask more from the richest when things need fixing, especially to protect those on lower incomes already squeezed. Plus an attack.
Finally, a control group saw nothing.
All groups then take the same survey probing their attitudes to the policies at hand and wider perceptions of the government. We compare each group’s attitudes to control; any statistically significant difference is a persuasion effect of the message.
The results, both for voters at large and swing voters, are below. Green is a statistically significant movement in a progressive direction; red is a meaningful persuasion effect in a non-progressive direction. Grey is ‘nothing much changed’ (all within margin of error).
Broadly, I think this shows us three things.
Firstly, and perhaps most importantly, in every group Labour’s political or economic brand - voting intent, best party on economy; the first five metrics in the table - was resilient to attack on this agenda (wealth taxation and borrow to invest). Even those who only saw an attack message did not move. They basically shrugged.
Secondly, there is some evidence (albeit the data for switchers is a shade noisy because the samples are smaller) that more positive messages – arguments framed around re-building the public realm, and especially restoring fairness in ‘who pays’ – are more likely to strengthen the government’s position than the slightly more negative black hole pitch.
The best story is probably a mash up of the three to the right in those tables; one framed around fixing Britain’s crumbling public realm - especially the NHS - then layering in arguments about restoring fairness in who pays.
Finally, it’s not all positive news for progressives. Opposition messaging was more effective at moving back policy support for employee NI increases (and reforming tax relief on pensions), even when people saw a strong government message. This again points to the ‘cost of living – public services’ tension discussed previously.
Overall, though - there is a decent amount of political space here, for the right ends, to make big changes. It is not limitless, but it is meaningful. And a galaxy away from the world of 2010-2015.
So what?
Which is not to argue that doing any of that is easy. I think it was the former Conservative adviser Rachel Wolf who once observed that the most annoying thing a pollster can do is walk in the gaffe, suck their teeth and say: ‘yeh, you just need the fix the NHS’ – as if a big red button existed under a desk somewhere in No 10.
But in some ways, that is the point: the truly hard thing here is the policy. And then the stakeholder management. Dealing with the media frenzy. It is a really hard time to govern from that point of view.
By comparison, I genuinely still think that - outside the demented echo chambers of Twitter or the Daily Telegraph website - the public attitude side is relatively benign, at least for now.
Of course that are red lines and tensions to manage. But we are not polarised like the US. Most people who decide elections in this country are reasonable minded. They would simply like, in a few years time, to not be waiting six hours in A&E; continually damaging their car on craters in the road; witnessing a care system they’ve paid into their whole life fail their elderly parents. Or for there to be shit in the rivers.
Given a plan and, crucially, a story about addressing these things that they feel is fair and coherent, they will give it a crack. 2029 is a long way away. Should the government point itself in that direction, there is still a decent chance voters will go with them.
The full research is available on the Persuasion UK website.
If you have found this in any way useful please do share it on Twitter, BlueSky or even over e-mail with anyone you think you think would enjoy it too.
Thank you to the YouGov team for all their patience and help on this project, especially Patrick English, Chiara Ricchi and Beth Kuhnel-Mann.