Local government devolution – Why and why now?

Let us put aside for one moment the intellectual incongruity and perhaps madness of saying you want to deliver 1.5 million new homes whilst at the same time reorganising a vast swathe of local government. Good luck with those both working out simultaneously! Instead, let us focus on why the government wants local government devolution at all. There are principally two reasons:

Intellectual rationale – Every government wants to cut the cost of local government. Every government wants to streamline or rationalise local government. And quite bizarrely every government pretends to believe that they can do these and not have any impact on local government service delivery. We all know this is insane but still politicians of all colours persist with this magical thinking.

And of course there is an intellectual rationale to streamlining local government. The arbitrary split between the services county councils provide (principally education, social care, transport, minerals planning etc) and those managed by district councils (typically housing, planning, leisure services, waste collection etc) is fake because unitary authorities, like London boroughs, manage both roles. And if you merge six councils into one, then that's five less chief executives, five less finance directors etc. So the Treasury loves this idea and always has done.

Political rationale – But there's a deeply cynical political rationale to all this as well. It inevitably means many fewer Tory and Liberal Democrat councillors. And importantly the denial of many future Reform councillors. And councillors are these parties’ main activists. Labour grassroots activism is in large part supplied and funded by the unions.

So one can see the appeal for Labour politicians to publicly hide behind this intellectual rationale whilst quietly trying to kill their political opposition. As we wrote, a deeply cynical political strategy, which, as ever, none of the great minds of British journalism have noticed. Plus ça change.

Ouch! – The UK impact of Trump

Are you struggling to keep up? It's been quite the rollercoaster ride for the last 102 days. Even before he arrived in office, we were all feeling the Trump effect. And whether you like him or loathe him, his team and all its works, one cannot but be in awe of the energy and dynamism the Trump regime has brought to government, with its constant international reverberations. This is quite a damning contrast to the pitiful arrival in office of the Starmer regime, which flopped across the line as the most unpopular newly elected government in UK history and has since bounced from one self-inflicted cock up to the next.

One of the perplexing political issues de jour is how timid the Starmer government is being whilst riding high on an absolutely massive majority, in contrast to how boldly the Trump regime is behaving whilst sitting on a wafer thin majority in Congress. Go figure.

But what is the impact of Trump upon the UK political scene? Let's put aside the fact he has lots of haters. Let's not focus on the comedy gift that His Royal Orangeness is. Instead let's focus on the real hardcore impact he's had so far on the British political landscape, the UK government itself, and all the things that flow from that.

Economic – If you want to understand Trump’s economic policy please don't sign up to Truth Social. That way lies madness and advanced ‘Trump derangement syndrome’. Listen instead to Scott Bessent, Trump's Treasury Secretary, the equivalent of our Chancellor of the Exchequer, only he didn't fake his CV and pretend he was economist. He is a serial hedge fund investor and taught economic history at Yale.

Their economic policy is simple: Wall Street has had it good for decades but now it’s Main Street’s turn. So let's bring all those offshore jobs back to the US from China, Vietnam, India, Bangladesh etc and get manufacturing again. That will inevitably cause some short term economic pain, just like it did when Reagan and Thatcher re-engineered their respective economies. But there should be long term gain. In theory.

For the UK, this means we're going to be buffeted by the ripples from that realignment. That may mean international recession sometime soon. We will need to ride those waves.

Tariffs wars – It is one of the inexplicable facts of this moment that the people who most volubly complain about the madness of tariffs are almost always incredibly pro-EU, the chief tariff creator on the planet whose whole gig is bullying everyone else’s economy by threatening or actually applying tariffs. The Trump regime’s play here is to tilt the playing field to their advantage and specifically make offshoring prohibitively expensive to force lots of companies to bring those manufacturing jobs back home to the good old US of A. Trump is using tariffs as a creative negotiating tool to bend everyone else to his will.

For the UK, if we actually want a trade deal with the US we're going to have to sup some painful medicine. Just being British, endlessly bigging up the ‘special relationship’, meekly offering state visits and kissing the presidential behind isn't going to win us any favours.

Defence spending – The Americans are bored of paying for European defence. God knows they've been doing it for 80 years, whilst we all spent our defence budgets on health and welfare while lambasting America for not doing the same. Cheeky.

The UK impact is that we are going to have to spend a lot more money on defence in very economically constrained times. This was just not on Western democracies’ agendas before last year’s Presidential election.

‘Alphabet spaghetti’ world – Trump has declared war on ESG, DEI, 2SLGBTQIA+ (look it up) and ATAILACALOM (acronyms that are increasingly long and cost a lot of money…OK we made that last one up). The point here is that with US government top cover, corporates are quietly defocusing from ESG and dumping DEI commitments. In the USA especially but increasingly here in the UK as well.

With the recent Supreme Court ruling on trans issues, and St Tony of Blair now breaking cover in pointing out that the rush to net zero is fool's gold, it remains to be seen how the UK government will respond to all this.

DOGE and the cost of government – Prior to the US presidential election literally no one anywhere was talking about cutting the cost of government. That’s the sort of mad thing that Liz Truss would get pilloried for. Now it's all the rage right the way across western democracy. Every week some minister from the Starmer regime pops up on the BBC Radio 4 Today programme to boast about their ‘bonfire of the quangos’ and how they can’t wait to cut the civil service down to size. Let’s see how well the civil service defends itself from this political rhetoric; politicians come and go but the civil service sails serenely on, getting larger year on year. Remember, as they say in Whitehall, Yes Minister wasn’t a comedy, it was a documentary.

EU realignment – The more the Trump regime lashes out, the more his European targets huddle together. And therein lies the conundrum for Starmer. With a polarised US and EU, trying to sit on the fence and be best friends with both is going to become increasingly tricky. Starmer was after all the ‘Remainer-in-Chief’ who de facto led the second referendum campaign after the Brexit vote. So his natural inclination is to see how close he can hug the EU, giving away Brexit freedoms he never wanted in the first place, without cheesing off His Royal Orangeness by showering him with Royal photo ops. That will be an increasingly tricky balancing act.

It has been an educative three months watching the impact of one man 3600 miles away change the current shape and perhaps the future of the United Kingdom. Trump is the reverse George III, this time with the Americans throwing their weight around and us having to behave like loyal subjects.

Polling – Why are they so wrong?

There's trouble in polling land. In election after election the polls keep getting it wrong.

Consider last summer's General Election. For almost two years the polls told us that the Labour Party was 20-30 points ahead of the Tories, and sometimes even more. When the votes were counted, they were just 10 points ahead. If any of us reported results to our boards that were 200% wrong, we would be an HR problem by mid-morning.

(Not to say we told you so, but for the record the REC team in our blog posts and presentations had been pointing this out for months on end and pretty accurately estimated the actual lead. If it had not been for the steep rise in Reform polling in the immediate run up to and during the General Election campaign, we would have had a horribly hung Parliament).

So why are the polls so regularly wrong? They didn't think Cameron would win a majority in 2015. They didn't think Brexit would triumph in 2016. They didn't predict the first Trump win. They didn't predict the Boris landslide in 2019. And they massively overestimated Labour's lead in the 2024 General Election. They didn’t foresee the Trump landslide last November. It's not a great record. So what's going on?

There are several reasons. Here are a few of them.

When our chairman was in short trousers (he's very old!) pollsters knocked on your front door with a clipboard. It was a truly random sample and, admittedly in simpler political times, the polls were pretty accurate. But it was expensive because you needed lots of people knocking on lots of doors.

By the time our chairman was a teenager with a suitably silly haircut, the pollsters had discovered telephone polling. And random digit dialling meant they could get a clean representative sample of voters fairly easily. The polls remained pretty accurate for a while. But it was still quite expensive because you needed lots of people manning telephones, and over time it became increasingly difficult to reach some groups, such as younger people who no longer had landlines and often seemed to have a phobia about answering the phone.

When the internet arrived, so online polls were born. Each polling company recruits a panel of people willing to be polled, for a small fee. And this was much cheaper because you just need to send out a whole lot of emails, your paid panellists do your work for you and all you have to do is analyse the results, produce some funky charts and send out a press release.

Problem 1: what kind of weirdo volunteers to sit on a pollster’s panel? Do you know any of these people? Well, we know what kind of weirdos, predominantly people with a centre Left persuasion apparently who dominate polling panels.

Thus Problem 2: this presents all sorts of challenges for the polling companies as they need politically balanced samples. So they resort to all manner of juju, magical mathematical trickery to end up with a balanced sample. It's called ‘weighting’. Weighting goes like this: ‘We have too many left-leaning rural mums in the southwest so let's dial that number down a bit and dial up our underweight white male Tory voters in eastern England’, or something like that. So the poor old pollsters are constantly having to twiddle a whole load of knobs on their models to try and desperately balance their samples.

Then we have Problem 3: we are living in crazy political times, in a new five party system, with swing voters all over the place, tactical voting galore, with new political parties popping up on a regular basis and with seemingly now regular ‘black swan events’ that move voters’ opinions substantially. It's a pollster’s hellhole. They keep having to invent new knobs to twiddle to try and get that perfectly balanced sample.

So dear friends our polls are not really very reliable at the moment. Our advice:

1. Always ignore a single poll as they are generally irrelevant.

2. Always look at the long term polling trend as this is likely to be more accurate.

3. But always listen to the sage-like advice of Lord Ashcroft: “Polls are a snapshot of current public opinion as at today and not a prediction of the future”.