A Delicate Balance: the history of Liberals and hung Parliaments

The Liberal Democrat History Group meeting at Bournemouth conference, supported by The Guardian, looked at hung Parliaments and lessons from the past for the Liberal Democrats.

In his introduction, the meeting chair Duncan Brack explained that one reason for picking the topic is that work such as that by John Curtice has shown that the odds of the next general election producing a hung Parliament are much better than they have been for many years. It is a point that was also made earlier this year by Michael Crick.

Professor Martin Pugh then kicked off the trio of talks, looking at the two Labour Governments of the 1920s. The Liberals were still badly divided between Asquith and Lloyd George camps, even though the domination of the 1923 election by the question of free trade had helped bring them together. The outcome of that election was a hung Parliament: 258 Conservative, 191 Labour, 158 Liberal.

Based on his experience of the First World War, Asquith did not want a coalition government to be formed with either party. The Liberals did though have a choice of which party to let form a minority administration. Asquith took the view that a Labour government was inevitable at some point in the future – and so better to ‘trial’ one now in the, as he thought, safe conditions of a hung Parliament. Churchill and others argued though that both Labour and the Conservatives should be voted down, hoping that the Liberals would therefore be given a try. Be bold, be quick in voting down a minority government – and hope something better would emerge.

This call for boldness did not carry the day and Labour under Ramsay MacDonald formed a minority government. MacDonald had clear, long-term strategic aims: keep the Liberals out of power and further strengthen Labour relative to the Liberals. Whilst Labour pursued its long term vision of replacing Liberals, Liberal MPs were rather shocked to discover that Labour didn’t cooperate in Parliament and, in the constituencies, was gunning for their votes and seats. This included running candidates in many seats where they would split the anti-Conservative vote and so let the Conservatives gain the seats from Liberals. For Labour, the short-term pain of strengthening the Conservatives was worth it for the long-term gain of making British politics be about two parties, with the Liberals not one of the two.

The 1924 electoral landslide for the Conservatives at the end of this period of minority Labour rule was, therefore, not as bad for Labour as it may have seemed. A result of Conservative 412, Labour 151, Liberal 40 may have been poor for Labour in the short-run, but the gap between Labour and the Liberals nearly trebled.

Despite the Conservative landslide, their hold on power was fragile and the late 1920s saw both a revival for the Liberals under Lloyd George and then a hung Parliament after the 1929 election: 288 Labour, 260 Conservative and 59 Liberal MPs. Again a minority Labour administration was formed.

Although the Liberal revival in terms of votes did not turn into many more seats, Lloyd George was confident of the strength of his position believing (rightly) that many people voted Labour hoping Labour would implement some of the policies to tackle unemployment that the Liberals had been proposing.

By spring of 1930 Lloyd George was involved in behind the scenes talks with Labour on policy areas such as unemployment and house-building in rural areas. This developed into a stable relationship, with weekly meetings by spring 1931.

Again, though, MacDonald’s long-term vision was not of cooperation. He wanted to ensure that Lloyd George did not back the Conservatives, but he didn’t really believe in cooperation and did not trust the Liberals. He wrote privately about the need “to humour” the Liberals. When it came to electoral reform, therefore, there were talks – sufficient to humour the Liberals – but MacDonald was not a believer in even the alternative vote, despite the temptations of it delivering more seats for Labour. That was outweighed in his eyes by the way in which AV would help sustain the Liberals and a three party system. In the end, he was content for the House of Lords to mangle an electoral reform bill.

For Liberals, there were two problems – that of propping up a failing government and that of unity. There were persistent rumours that the Conservatives would give a free run to any MPs who opposed Labour and there was a group of Liberal MPs who by the end were regularly voting against the Government. Lloyd George had got sucked into the talking details with the government, without an overall strategic aim and without delivering the big prize of electoral reform. Given how he had also messed up getting electoral reform during the First World War, Martin Pugh suggested it was an issue he never really got to grips with.

All was then swept away by MacDonald forming a coalition with the Conservatives, Labour splitting and the National Government winning a huge landslide in 1931. It was not until the 1970s that the Liberals next had a chance of power courtesy of a hung Parliament.

The story of the Lib/Lab Pact was taken up by Tom McNally, who worked in Downing Street in the 1970s and subsequently became a Lib Dem peer. He echoed the dangers of losing sight of the strategic aim, recounting his memories of Paddy Ashdown returning “bouncing” around after meetings with Tony Blair despite it not being clear what he had achieved.

On the Lib-Lab Pact itself, McNally challenged the consensus in liberal circles that the Pact was a disaster. 1976-78 was the period when Britain was the most equal , which McNally attributed to the Pact’s influence. Moreover, it was sensible for the Liberal Party to act in a way to avoid a general election in 1976 the outcome of which would have been far worse than the Pact.

At the time many serious editorials were asking whether Britain was still governable – and again McNally the Pact was a success in showing that it was. By 1978 every economic indicator was moving in the right direction said McNally, but the problem was that the Liberals were getting almost no credit for it.

So what was wrong with the Pact? For Labour Prime Minister James Callaghan and Labour it was only a shotgun marriage of convenience, so there was no parity of esteem between the two parties. There was also a complete lack of parity of resources. Both of these were the same as in 1920s, as was the third problem – electoral reform. As in the 1920s, David Steel did not push the issue to breaking point, but McNally argued he had no alternative as Labour was not willing to move.

By contrast, in the Cook-Maclennan Labour/Lib Dem constitutional talks in the run up to 1997, the Liberal Democrats went in well-briefed and with a clear idea of what they wished to achieve, whilst Labour did not have a clear set of objectives. Back in the 1970s, the idea of working together was still to hard to stomach for Labour. There was no long term stability based on shared commitment and some shared objectives.

It was in 1999 that there was the next round of Labour / Lib Dem talks, a story taken up by David Laws. He is now MP for Yeovil but in 1999 he was the party’s Policy Director and gave advice to the Scottish Liberal Democrats on how to handle the hung Parliament when arose from the first elections to the Scottish Parliament. He talked about 6-13 May 1999: the specific period when the coalition agreement was put together.

David Laws’s seven rules for negotiations

During his talk, David Laws outlined seven rules of negotiation in hung (balanced) Parliaments for Liberal Democrats:

  1. There is huge pressure from the media and others which requires a deal to be struck quickly if at all.
  2. About 20% of colleagues will be happy with any sort of coalition, 30% will oppose any sort of coalition and the rest will decide on the details of the proposal.
  3. Any coalition has to address issues of policy substance.
  4. You have to be tough and prepared to walk away to get a good deal.
  5. But you can agree to postpone tackling some large complicated issues if more time is genuinely needed to work out a compromise – and if there is always the threat that the coalition will end if it isn’t reached.
  6. You need to get commitments in writing about the administrative details of how coalition government will work.
  7. Vigorous internal party debate over the proposed terms is vital for any deal to stick.

Recounting the events of 1999, he said he was struck at the time how, due to being heavily focused on fighting the elections, there was relatively little prior attention to what a coalition might involve. He had two documents to start with – a draft coalition document that had been going round the party since the 1970s, which was of very limited use, and the Scottish elections manifesto.

Laws therefore modelled his first draft of an agreement with the New Zealand coalition document he and Malcolm Bruce had studied on a prior visit there. That had a very detailed section on how a partnership would work, along with a section on each policy area.

There was – as always – huge pressure from the media to make very quick decisions after an election, despite the time that consultation takes and the exhaustion of everyone at the end of a campaign. Laws erred on the side of believing in the importance of speed, in part because of the need to build confidence that an arrangement would work.

The draft agreement went through detailed consultation with the party over two days, which then went over to Labour by Sunday evening. Labour’s response was an extremely brief document – only four sides – and which was not much of a coalition offer. It talked about “implementing Labour’s manifesto” and on the big issue of tuition fees only offered to monitor the situation for three years.

One reason Laws did not believe this was sufficient is that as a rule of thumb across different situations, Laws warned that around 20% of a leader’s colleagues are keen on agreement and around 30% want no coalition under any circumstance. The rest are willing to be persuaded, which is why discussions have to be heavy on policy in order to convince them that an agreement will deliver enough of what they believe in.

The subsequent negotiation was very intensive. The civil servants were not impartial, very much seeing themselves as working for the largest party. Laws showed four different drafts of the agreement which were produced in just one afternoon.

Labour believed that the lure of ministerial jobs would eventually mean the Liberal Democrats would weaken their demands and agree. But by being clear that they would not fold, the Liberal Democrats extracted a much more substantive and amenable proposal.

Labour found it hard to understand the consultative internal processes the Liberal Democrats followed. But it was crucial, not just to how the party operates but also to making an agreement which could last – and it did. Michael Steed in questions raised the point that stability also came from fixed-term Parliaments for Scotland. In all the other cases talked about the Prime Minister had the nuclear option of calling a general election at any time.

Another question was from Michael Meadowcroft, who highlighted the lack of unity between the Asquith and Lloyd George camps in the early 1920s. He had met someone employed to work on a by-election of the time. The by-election team was based in one building, but split between the two camps over two floors – and the person he met was employed to run messages back and forth between them.

In concluding comments, Tom McNally highlighted how similar the lessons were from all the historical occasions, in particular the importance of a united party with a clear strategy and of party consultation, effectively but quickly. Martin Pugh echoed the point, talking of the need for personalities to gell across the agreement. Looking at MacDonald’s flaws which made him very difficult to deal with and put the Liberals on a hiding to nothing in the 1920s, he suggested Gordon Brown would similarly be impossible to deal with. Laws echoed this and recounted how Gordon Brown was brought in to the Scottish negotiations at one point and shifted his arguments around in a way which made negotiation extremely difficult. On that rather contemporary note, the meeting finished.

UPDATE: Reuters have a report of the meeting here.
UPDATE 2: David Laws’s ‘7 laws’ added above.