An electoral car crash

In one of the great dramas in British political life, the Prime Minister, Theresa May called an election when she was 25 points ahead in the polls – and six weeks later is now clinging to power, without a majority in Parliament, dependent on a small party from Northern Ireland.

She called the election at a time when she appeared to be in a very strong position and the opposition weak and unelectable. She asked for a strong mandate to negotiate a good deal with the EU as the UK leaves, but has been left barely able to command a majority in Parliament.

So what happened?

The figures tell some of the story. The number of votes for both major Parties went up, but the increase for the opposition Labour Party was 9.5%, nearly double the 5.5% increase for the Conservatives. Many of these were from people who previously voted UKIP, but now, after the referendum, felt able to return to Labour. The Conservatives had bet that the vast majority of these Brexit-supporting voters would come over to them. In fact it may be that Jeremy Corbyn’s lukewarm support for Remain and decision to accept the referendum result gave these voters the opportunity to return to Labour.

The result can also be ascribed in part to a rejection of 10 long, hard years of Conservative Party austerity. Many of those who voted for the UK to Leave the EU have suffered during the attempts by the Conservative Government to cut spending. The demographic that voted to Leave last summer, angered by paying a price for globalisation and feeling ignored, are it seems, also angered with cuts to school budgets, pressure on the National Health Service and cuts to local authority services.

The Conservative Manifesto also attacked things that are important to the core Conservative vote, breaking promises on pensions and proposing that peoples’ homes would have be sold to pay for their long-term health care.

The final failure was that the Conservatives tried to run a presidential campaign which claimed that the Prime Minister was ‘strong and stable’. The country liked that idea initially and her support soared, but within days Mrs May was changing her mind about key parts of the manifesto, proving that she was neither strong nor stable.

On the other side, the Labour Party ran a campaign that promised everything to everyone. Promises of increases in spending on everything, paid for by only a few tax rises on the very wealthy. This proved irresistible to a huge majority of younger voters. It is also true that some voters thought that they could vote for the Labour Party safe in the knowledge that the Conservatives would win, a sort of protest vote. They were very nearly proven wrong.

Labour did not win, but the Conservatives only managed to win 319 out of the 650 seats in the lower House of Parliament. To have an effective working majority (once the Northern Ireland party Sinn Fein, which does not take it seats in the British Parliament, and the Speaker and Deputy Speakers are excluded) parties need to command 320 seats. After this election no party has a working majority. The Conservatives are therefore trying to secure an agreement with the DUP, a small socially conservative Party from Norther Ireland, which would get the Conservatives to 329 seats and so a functional majority.

This will still only be a tiny minority, handing a lot of power to factions within the Conservative Party. Some say this would make the Prime Minister too dependent on Hard Brexiteers, who want a minimal deal with the EU. This is true, but it is equally true she would also be vulnerable to Soft Brexiteers, who would like to leave the EU, but only in name, not in practical terms.

Mrs May will remain as Prime Minister for the moment, but her political credibility has been shattered. There is a lot of anger in the Party; and the arrangement with the DUP is fragile. ‘Confidence and supply’ is the nature of the agreement between the Conservatives and the DUP. It is a looser arrangement than a formal coalition deal and means that the DUP will support the Government and its budget, but all other votes would be determined on a case-by-case basis – leading to considerable day- to-day uncertainty in government business and its legislative agenda.

In her weakened state, the Prime Minister has reappointed most of the key players in the previous administration to their previous Cabinet positions. Despite this, there remains a lot of unhappiness among senior Cabinet members and the wider Conservative Party over the way she conducted the election campaign – and yet there is also no clear agreement among the Party on a credible alternative leader, nor a strong appetite for an imminent leadership contest.

It has been announced that Queen’s Speech – in which a new Government sets out its business for the year – has been delayed. This underlines the difficulties the Government is having in putting together a programme of legislation that would pass through both Houses of Parliament. It is understood that civil servants are looking at the legislative programme only on the basis of Bills that will receive cross-party support in both Houses.

In terms of major policy implications, there have been further indications that the Government will soften its opening negotiating position in the Brexit negotiations. Currently the debate is between those favouring a ‘no deal’ WTO option, to those favouring membership of the EU Customs Union and/or some form of membership of the Single Market, or trading arrangements in line with the EEA or the EFTA rules.

Given the numerical instability of the Government, the level of political uncertainty is expected to continue. There is good chance of a further election later this year or early next year – although there is recognition among many Conservative Party supporters that this would be very risky for them.

Even if Theresa May remains in place, we wold expect further speculation concerning a future leadership candidates.

Political Overview: Merkel doubtful about Trump’s reliability, major SPD government reshuffle, government consultations with Indian and Chinese leadership

Chancellor Merkel has reaped positive critics from around the globe for her speech on the new importance of European self-reliance as a reaction to U.S. President Trump’s aggressive stance towards multilateral partnerships. At a rally last Sunday she stated that „the times when we could fully rely on others are partly over.“ Merkel’s remarks signal a departure from the historically close transatlantic relationship towards a more self-assertive, united European Union. Among those siding with the chancellor in her rebuke of Trump’s reluctance to compromise were not only newly-elected French President Emmanuel Macron but also Merkel’s prime challenger for the September 2017 Federal Elections, SPD lead candidate Martin Schulz who labeled Trump’s conduct as being „not acceptable“. The G7 summit’s final communique also reflected the estrangement between the U.S. and its international partners with frustrated member states calling out the U.S’s unwillingness to cooperate, especially on climate change. Now that Trump has publicly announced to unilaterally withdraw from the Paris agreement, political tensions are expected to increase further.

Due to health issues, Mecklenburg-Western Pomerania’s long-time Minister-President Erwin Sellering has surprisingly resigned from his position, recommending Minister of Family Affairs Manuela Schwesig as his successor and thus causing a large-scale government reshuffle within the SPD. The party’s secretary general Katharina Barley was chose to assume Schwesig’s cabinet position passing her own job to MP Hubertus Heil. It is the second time Heil will serve his party as secretary general having seen his first spell abruptly ending after the SPD’s historic election defeat in 2009.

While the SPD is personally reorganizing itself, Chancellor Merkel has held meetings with Indian prime minister Narendra Modi and his Chinese colleague Li Keqiang in the context of the German-Indian and German-Chinese government consultations. Talking about the upcoming G20 meeting and further possibilities to deepen economic exchange, Merkel und Modi agreed on more than €1bn development support for India, more cooperation in the field of renewable energies and a resumption of the stalled free trade negotiations between India and the European Union. The discussions with Keqiang were similarly productive and included a wide range of fields, particularly the issue of climate change and how to counter the U.S.’s latest policy shift.

Political Overview: Hasty presentation of SPD draft election program, Coalition negotiations in Schleswig-Holstein can be opened between Greens, CDU and FDP

After two rough weeks following the elections in Schleswig-Holstein and North Rhine-Westphalia, the Social Democrats wanted to present the core issues of Martin Schulz‘ election campaign: social justice and equality, to initiate the needed turnaround.

Originally the draft was supposed to be passed by the SPD’s executive board on Monday morning and presented shortly after. Instead, the vote on the board and the subsequent presentation was first called off on Sunday. After public criticism in newspapers, the original plan was re-instated Monday morning. Instead of an adequate presentation the program was presented by Katarina Barley, the SPD’s Secretary General, in a less than 10 minutes press-conference. Martin Schulz, who was criticised for his lack of involvement in the campaigns for the regional elections, also was not involved in the presentation. Other than expected, all of the key details on social security and taxation were missing in the presentation, as the Executive Board had not found a consensus on the matter.

Developments in Schleswig Holstein may be another reason for Martin Schulz becoming awkwardly silent, as the Greens decided to enter coalition negotiations with the CDU and FDP.

In current polls Ms Merkel (49%, +3) is ahead of Mr Schulz (36%, -4). Regarding party polls, the CDU scores 38% (+1). The SPD loses 1 point, dropping to 26%. The FDP, in its best result since 2010, would receive 9% (+1) if elections were held this week. Greens (8%) and the Left (6%) stagnate. The far right AfD  is at 9% (-1).

Angela Merkel 3 – Martin Schulz 0

There have been three regional elections in Germany this year and the results don’t bode well for Martin Schulz, the former President of the European Parliament, and now the leader of the Social Democrats (SPD) ahead of September’s federal election. The latest two setbacks came just seven days apart, as Schulz’s party lost consecutive votes in the states of Schleswig-Holstein and North Rhine-Westphalia (NRW), despite leading the incumbent government. To make matters worse, the weeks leading up to the elections saw the Social Democrats quickly dropping in opinion polls in both states, with Schulz being almost invisible in both campaigns.

You may read more on the blog of our London based partner Newgate Communications


Like the two previous state elections in the Saarland and Schleswig-Holstein, state elections in North Rhine-Westphalia (NRW) are a bad omen for the  Social Democrat’s: The CDU received 33% of the votes (+6.7), bringing the SPD’s rule of a traditional stronghold and Germany’s most populous state to an end. The SPD dropped to 31.2% (-8). The liberal FDP got 12.6% (+4), delivering its strongest performance in the state ever. The Greens’ share of the vote almost halved to 6.4% (-4.9). The Left missed the threshold with 4,9% (+2,4). The far right AfD won 7.4% and is now represented in 13 state assemblies. The SPD already excluded the possibility to form a grand coalition in NRW. That makes a CDU-FDP coalition the most likely option: negotiations however will be slowed by Christian Linder, the party’s state and federal leader having ambitions for the federal level — it is unlikely that he will remain in NRW for long.

Hannelore Kraft (SPD), head of the deselected state government, already announced her withdrawal from her party posts on the evening of the election day. SPD party leader Martin Schulz tried to deflect the blame to NRW’s Hannelore Kraft, and promised to fight ever harder. In an interview, he outlined three not so new themes: Solidarity, “future” (meaning, mostly, education and digitisation) and Europe. While Ms Merkel already moved on to other issues, her Chancellor Minister Peter Altmaier pointed out the SPD’s weakness: “What is this party standing for?” The Social Democrats reacted hastily, and published their first draft for an election program, with little public notice. Perhaps thought as a test balloon, the paper outlines more taxation, education and welfare policies as well as strengthened security services but still has gaps regarding the most contentious issues.

Current polls show Ms Merkel (49%, +3) is ahead of Mr Schulz (36%, -4). Regarding party polls, the CDU scores 37% (+3). The SPD loses 4 points, dropping to 27%. The FDP, in its best result since 2010, would receive 8% (+2) if elections were this week. Greens (8%) and the Left (7%) stagnate. The far right AfD  is at 10% (-1).

On EU affairs, Ms Merkel warned that Germany could move its soldiers from a Turkish army base if MPs aren’t allowed to visit. Foreign Minister Sigmar Gabriel  agreed, warning the Turkish Government of “blackmailing”.