Three parties, three weeks of good politics – and bad government

Inside Whitehall: To win elections parties think they need eye-catching populist policies

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Indy Politics

There may still be a year and a half to go until the next election but in Glasgow, Brighton and now this week in Manchester Britain’s political parties are drawing up their battle plans.

Support the Liberal Democrats and your child will get a free hot lunch in the middle of the day. Choose Labour and your energy bills will be frozen for two years. Give the Tories a chance to govern again and you’ll be rewarded with a tax break for being married.

Three parties, three ideas – but with one thing in common: they are good politics, but bad policies for Government.

Take Nick Clegg’s plan to give every five-to-seven year-old a free school meal. To be extended to all primary school children, the policy will save families an average of £437 per child per year at a time when people are struggling.

But at a time of huge cuts to public services it is surely perverse to be spending more than £500m of taxpayers’ money on an initiative that will disproportionately benefit the better-off. Children whose parents earn less than £16,190 a year already get free school meals – and there is a strong argument for raising that threshold.

But why should parents who earn £40,000, £50,000 or even £100,000 benefit as well? The answer is that the Liberal Democrats want the votes of middle-class parents at the next election and this is an eye-catching “give-away” that will go down well on the doorstep. Good politics – bad government.

Next take Labour’s pledge to freeze energy bills for two years. At first glance, the policy seems attractive. We all suspect that energy companies have been ripping us off for years and Labour’s price freeze has no cost to taxpayers.

But it is not without downsides. While we believe we are being over-charged for our gas and electricity, the  evidence for this is not compelling. Electricity prices in Britain are lower than in Ireland, Spain and Germany as well as the European average. Nor are utilities hugely profitable. Most of the “Big Six” operate on margins of between 4 and 5 per cent and, when bills go up, the cause tends to be changes in the wholesale price of energy.

All things being equal, those reasons would not be enough to think that the energy companies could not absorb a price freeze. But Britain faces a looming energy crunch. We need to spend billions on new nuclear, renewable and gas generation to keep the lights on, as our aged, dirty coal and gas-fired power stations come to the end of their lives.

To pay for this investment, the energy companies have permission from the Government to raise up to £5.6bn from consumer bills by 2018. But under Labour they will have to absorb the cost of this investment themselves for two years and it is hard to see how they will be able to do this.

And what about the Conservatives’ tax break for married couples? Recognising marriage in the tax system has long been a cherished ambition of David Cameron.

But it is hard to see how it makes good government. The plan uses the tax system to discriminate against widows and widowers, single parents and unmarried couples who live together. So a gay couple in a civil partnership with no children earning less than £40,000 a year would benefit – but an unmarried couple with three children earning £30,000 a year would not. Mr Cameron is using the policy to appeal to core Tory supporters – but it’s basically another £700m of borrowing (or cuts) from the party that promised no unfunded spending commitments.

The truth is that to win elections parties think they need eye-catching populist policies. But to govern well they need nuanced, complicated policies that are hard to explain. That’s what we should remember when casting our votes.