Labour lead over the Liberal Democrats in my constituency in 1997: 25,998. Lib Dem lead over Labour in 2005: 2,395. So as you can imagine – I’m quite a fan of the party’s campaigning techniques! One of the curios of the result though was afterwards – the number of constituents who came up to me (quite genuinely) to say, ‘I didn’t vote for you, but I’m really glad you won.’

This wasn’t a burst of over-eager politeness, but rather reflected that many people liked the Lib Dem message locally but wanted more convincing about the full range of the Lib Dem offering. And that – in my view – is in large part is because we concentrated on a fairly narrow range of popular policies.

The justification for this is fairly straightforward. For a third party you have to boil down the number of things you are talking about on the national stage to a minimum to have a chance of getting any message across. And the policies were on the right issues. Indeed, one of the major shifts in the Liberal Democrats’ approach to campaigning in the mid-1990s was a switch to concentrating our efforts on the issues which people say are most important to them at (Westminster) general election time. The result – ‘health, education and crime’ have become a bit of a holy trinity- though we often don’t say nearly enough on crime (see my article in Liberator No.304).

There was quite a wide-spread agreement in the party that, looking forward to the next general election, one thing to work on is to have a clearer theme / narrative / big picture / ideology / call it what you will so that the popular policies fit into a more coherent overall story. The Meeting the Challenge policy review is in part about that. And with a leadership election going on as I write this, that process too will concentrate people’s minds on these issues.

But to have a successful story, you need the right constituent parts. Look again at that holy trinity of health, education and crime. Intriguingly missing from this list is the economy. Why ‘intriguingly’? Well – the trinity is based on both public and private polling – but if you ask one of the political chattering classes (and there are quite a few of them in my constituency!) they’ll most likely say that the economy is crucial to shaping the result of general elections, probably accompanied with yet another retelling of the story about Clinton, 1992 and James Carville’s ‘the economy, stupid’ sign. Or as Philip Gould wrote to Tony Blair on 17 April that he should: ‘drive the election to the point where it came down to one central question: ‘Who do you trust with the future of the economy?” But the economy doesn’t feature in the trinity.

So where’s the economy hiding? I think the answer is in the details of how the polls are done. Don’t worry – you don’t need to be a statistical geek to follow this (lovely though such people are, I hasten to add) as the basic point doesn’t even need any decimal places.

Polling companies like MORI ask people which issue is more important to them and give answers for ‘health’, ‘education’, ‘crime’ etc. But economic issues get split between a range of categories, such as economy, taxation and unemployment. So for ‘health’ the MORI definition is ‘National Health Service / hospitals’ and for crime it’s the even more omnibus ‘Crime/Law & Order/Violence/Vandalism’. The judicial system, the crime rate, policing issues – they are all put together into the one heading. However, for the economy we have separate categories for ‘Economy/Economic Situation’, ‘Inflation/Prices’, ‘Pound/Exchange Rate/Value Of Pound’, ‘Taxation’, ‘Unemployment/Factory Closure/Lack Of Industry’ and more.

You could argue how many of these should be gathered together under the ‘economy’ umbrella but think of the contrast with the broad ‘health’ and ‘crime’ categories – and ‘education’ too – where all different schooling up to 18 and beyond is lumped into one category, including too the different issues of resources, buildings, curriculum etc.

Does all this matter? Yes it does – for example if you look at the MORI poll figures for November 2005 for ‘the most important issue facing Britain today’, the economy rates behind education and health – but leapfrogs over them if you add in unemployment and taxation. Yes, there are margins of error to watch out for – but it is a consistent pattern looking at the longer-term trends and not just amongst MORI’s polls: the economy moves up the list sharply if you define it more broadly.

Even on the narrow definition, there are some polls in which the economy comes through strongly. To whit – YouGov’s polling by May 5th 2005 had the economy as the third most important issue, after health and education, in answer to ‘which issues will be most important to you in deciding which party to support’ and this was even excluding taxation.

It’s true that economic news attracts much less media coverage than it did in the 1990s and earlier: look how little coverage the latest inflation or unemployment figures get and as for balance of payments figures – they used to be everywhere and are now harder to find than a smiling Gordon Brown. And where we used to talk about our economic policies in terms of European monetary polices and independence for the Bank of England both have largely been overtaken by events.

Instead our economic offering in 2005 was all about what to do with the fruits of prosperity – changing spending priorities, taxing a bit more those who can pay a bit more in order to fund necessary extra spending elsewhere and so on.

Therefore there is a double risk for Liberal Democrats at the next general election. First, without the economy joining the health, crime and education gang any narrative or theme won’t work as it won’t have the necessary key components. Second, if the economic outlook deteriorates further by the next election, policies about distributing bounty in the good times run the risk of being very dated and seeming irrelevant. It has happened to progressive parties in many countries on many occasions – when the economy takes a downturn, they are left behind if their policies don’t match the times. Just look at the struggles the Australian Labor party have had.

So – how to tackle this? We don’t make nearly enough of our economic policies in my view. For example, consistently election after election, it is the Liberal Democrats who have the most credible policies in terms of having a fully costed manifesto. The costings pass the scrutiny of the pundits but, aside from a few brief mentions on Newsnight and the like, what benefits do we accrue from this? With the honourable exception of the party’s website, www.libdems.org.uk – which had, and still does, ‘our policies are fully costed’ logos and links to details on most pages – these plus points about us are barely mentioned or publicised. My own leaflets during the election excepted too of course! – but according to the New Politics Network / Joseph Rowntree study of content of election leaflets, only 9% of Lib Dem ones mentioned the economy.

We also need to develop a clear and simple story about what our economic policies are which goes beyond ‘the sums add up’ and ‘fair and sensible reallocation of resources’. Both are desirable – and to be repeated – but they are not distinctively liberal.

I think our distinctive ideological approach is to be found in our suspicion of big government. Far too much of government – especially that within the paws of Gordon Brown, master of the complicated innovation and baffling regulation – is riven with complexity, confusion and bureaucratic waste. Brown is highly vulnerable on this I believe – the complexity of tax credit forms, the profusion of paperwork families need to fill out and the plethora of new rules and regulations may not attract much mainstream press coverage at th
e moment (a few glaring scandals aside), but ask any low-income mum sitting down to try to work out how to claim what she needs to keep her kids fed and clothed – and they’ll most certainly know what a bureaucratic mess Gordon Brown has made of so much of the financial system.

Waste, inefficiency and piles and piles of extra paperwork aren’t just economic issues, as they increasingly bedevil so many other areas of public services too. Take just one example from the transport field – it cost £455 million (sic!) in fees for lawyers, accountants, consultants etc to bring about the part-privatisation of the Tube. Instead that could have bought around 35 new trains, 65 kilometres of renewed track, 50 replacement escalators, 37 more escalators fully renewed and with enough money left over after all that to also have a comprehensive program of new lifts and other measures to make the Tube more accessible to those in wheelchairs and with other mobility problems!

Take another example, that was rather topical over the festive season – the rules over what shops can claim in their ‘sales’ advertising. Far too often they get away with grandiose claims. Being on the side of the individual is about making them a bit more honest – which brings greater clarify, more competition and more economic efficiency. Giving individuals accurate and timely information, and making economic systems simpler where possible so they can deal with them, will bring with it benefits of increased competition, productivity and in turn wealth.

Big, pondering bureaucratic government should be the natural enemy for liberals – and in the current environment our opposition to it can be honed into an effective economic policy that is about putting individuals first. Carville’s ‘the economy, stupid’ sign has entered political folklore. But people tend to forget what Carville wrote before that on his sign – ‘Change vs more of the same’. Reducing complexity in the taxation system; improving competition by having more openness; judging benefits systems by people’s ability to claim what they are due; reducing central bureaucracy through local delivery of services (and remembering to axe the bureaucracy left behind – remind me, why is there still a Government Office for London now we have a Mayor and GLA?); and more in that vein – that would be the real change.

This article first appeared in Liberator.