Here comes Mr Freeze!” That is how colleagues now greet Greg Beales, director of strategy and planning for Ed Miliband, one of the architects of the Labour leader’s landmark pledge to freeze energy prices. He road-tested the idea in polling after it was suggested by Arnie Graf, a veteran American community campaigner who once trained Barack Obama and is now Mr Miliband’s man on the doorsteps of Britain.
It is more than six weeks since Mr Miliband promised his temporary price freeze at the Labour conference and it is very rare for a speech by the leader of the Opposition to make the political weather for so long. Neil Kinnock’s 1985 attack on the Militant Tendency enemy within, and Tony Blair’s 1994 pledge to abolish Labour’s Clause IV commitment to public ownership, both repositioned the party and were noticed by the voters. But they lacked the X factor in Mr Miliband’s promise – a policy that helped hard-pressed people in their pockets. For good measure, it also answered critics who have been nagging Mr Miliband to spell out some real policies to illustrate his call for a new economy based on responsible capitalism. His pledge is entirely consistent with that.
Of course, one policy is not going to propel Mr Miliband into Downing Street. Next week Labour will turn to the kind of jobs it would create when it “re-sets” the economy. “Energy prices are a bridge to a much wider piece of territory,” said one Labour strategist. It is occupied by the estimated 10 million people in the “squeezed middle”.
The Tories have certainly felt a chill from Mr Freeze’s policy. It is one thing in politics to be destabilised by your opponent. It is even worse to show it, as the Tories have done. They are torn between dismissing Mr Miliband’s interventionist pledge as a “gimmick” which would mean a return to the 1970s, and matching it with gimmicks of their own.
George Osborne wants to keep the focus on “the economy, stupid” and the need for more spending cuts after the 2015 election. He believes eventual tax cuts are the best antidote to the “cost-of-living” problem. Nick Clegg agrees that the Coalition is making a mistake by being drawn on to Labour’s chosen territory. But David Cameron is desperate to see a more immediate response. He knows that key voters like the Miliband promise, even if they have doubts about him delivering it. So since the Labour leader’s speech, the Government has already rushed forward phase two of its Help to Buy (Conservative votes) scheme on mortgages; scrapped a planned rise in fuel duty; capped rail fares; and pressurised the water companies to keep down bills. There’ll be another gimmick along soon: Mr Osborne will have to honour Mr Cameron’s panicky promise to reduce energy bills by cutting “green taxes” in his autumn statement next month.
The Tories are in a mess. They could have opted for an “economy, stupid” strategy without cost-of-living gimmicks. But in trying to do both, they are incoherent.
Yet all is not lost for the Tories, and Labour hasn’t won the 2015 election yet. What matters is how things look in a year’s time. Allies of Mr Osborne are quietly telling Tory MPs not to panic because there is every chance that wages will start to rise in real terms next year. The Office for Budget Responsibility, the tax and spending watchdog, may predict as much next month. A rise in earnings of 0.5 per cent above inflation would not generate a “feel-good factor”. But it would no longer be tenable for Labour to bang on about prices rising faster than wages for all but one month since Mr Cameron became Prime Minister. Labour reacted uncertainly when economic growth returned. Mr Miliband knows his party needs to prepare some new tunes in advance of wages starting to rise.
The other reason his bullseye on energy prices spooks the Tories is that they have built their 2015 election strategy on voters seeing Mr Miliband as unfit to be Prime Minister. It is early days but his personal ratings since his speech have, in the words of one Labour adviser, “gone from abysmal to merely very bad”. If the trend continues, Tory jitters will increase. Crucially, it would make it harder for the Tories to detach “soft” voters from Labour in the key marginal seats, which Mr Cameron needs to do to win a majority in 2015.
Yet Labour faces exactly the same problem: most of its target seats are held by the Tories and to win an overall majority, it needs to detach some “soft” Tory supporters. It hasn’t happened yet. In January, six per cent of those who voted Tory in 2010 said they would now back Labour. The figure today? Still six per cent. “We need to win back the people Blair won over,” one Labour frontbencher dared to whisper. He is right.
How to keep a coalition on the road
Cheryl Gillan may not have set the political world alight during her spell in the Cabinet as Welsh Secretary until last year. But she shined an important light on the workings of the Coalition when she briefed a House of Lords committee on its constitutional implications. She said any future coalition should include a “no surprises” rule, so that one governing party is not ambushed by another.
The Conservatives and Liberal Democrats say they have an informal agreement along those lines. But it has not always held. The Tories were livid last month when Nick Clegg suddenly distanced his party from the Coalition’s flagship free schools policy.
Perhaps it was no coincidence that, four days later, David Cameron gave Mr Clegg only 30 minutes’ notice of his pledge to “roll back” the green taxes included in energy Bills. The two parties reached a gentleman’s agreement on what they would announce at their respective autumn conferences. There’s no reason why that shouldn’t be the norm.
It is going to be hard to keep the Coalition show on the road as the two parties diverge ahead of the 2015 election. Tit-for-tat politics would not be a good advert for coalition government.