The UK General Election - 4th July 2024

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PLMR Insights: Liberal Democrat General Election Manifesto

On Monday, Ed Davey launched the Liberal Democrats’ election manifesto in London. Hoping to regain its status as the third largest party in Westminster after almost a decade on the sidelines – MRP polling published last week suggests it will have 48 seats in parliament (four times more than it won in 2019) – Davey hopes to win voters over with the tag line “for a fair deal” that includes commitments to reforming the tax system, gender recognition processes and the UK’s relationship with the European Union (EU).

Combining solemnity with cheesy gimmickry throughout its campaign, the party will be hoping that its policies appeal to two sets of voters. The first are the potential switchers who have become estranged from the Conservative party who it hopes will be wooed by commitments to rejoin the EU Single Market and get tough on environmental regulation, among others. The second group are left-leaning voters in places where the Liberal Democrats are the main opposition to the Conservatives, including in constituencies where the party has succeeded in recent by-elections. Indeed, it is notable that neither Davey nor Starmer have spoken badly about each other on the campaign trail, with Davey keen to emphasise the shared values held by both parties.

Despite the Institute for Fiscal Studies (IFS) accusing the major parties of a “conspiracy of silence” over their fiscal policy, Davey insisted that commitments set out in the party’s 116-page document are “fully costed” through its plans to raise £26.9bn a year in tax. Specifically, it will seek to top up existing spending plans through some big tax increases on banks, energy companies and tech giants, as well as through proposed capital gains tax reform.

In terms of substantive policy, health and social care features prominently, with Davey using this morning’s launch to thank supporters and colleagues for the “incredible messages” he has received for talking about his own experiences. Specifically, the party pledges to enable everyone in England the right to see a GP within seven days, guarantee access to NHS dentistry, expand access to carers’ allowance and create a “cross-party commission” to establish agreement about a sustainable funding model for care. Other key commitments in the document include:

  • Repairing the UK’s “broken relationship” with Europe, signalling that the party would seek to redraw the post-Brexit trade deal with the bloc as part of a series of measures aimed at improving economic stability and providing growth.
  • Ending the sewage scandal by transforming water companies into public benefit companies and replacing Ofwat with a “tough new regulator”.
  • Maintaining the triple lock on the state pension.
  • Increasing school and college funding per pupil above the rate of inflation every year.

You can read the manifesto in full here and the party’s costings summary here.

Insights on policy areas

Economy

To boost the UK economy, the Liberal Democrats focus on promoting employment, supporting small businesses, improving productivity, and creating stability for long-term investments, particularly in future-oriented industries like renewables, digital, and bioscience sectors.

To address the cost-of-living crisis, the Liberal Democrats propose launching an emergency Home Energy Upgrade programme to cut energy bills and implementing a National Food Strategy to tackle rising food prices. Additionally, they aim to invest heavily in green infrastructure and innovation, focusing on renewable energy, zero-carbon transport, and industry, which will improve economic growth and create jobs.

The party emphasises responsible management of public finances, ensuring that national debt decreases as a share of the economy and that day-to-day spending remains within tax revenue limits. They also plan to enhance HMRC resources to combat tax avoidance and evasion effectively. Tax policies will be adjusted by reversing tax cuts for big banks, implementing a one-off windfall tax on the super-profits of oil and gas companies, reforming capital gains tax to close loopholes for the wealthy, and increasing the Digital Services Tax on large tech companies from 2% to 6% of their annual profits.

The Liberal Democrats want to ensure stability in the economy by protecting the independence of the Bank of England, maintaining a 2% inflation target, and ensuring that all fiscal events are accompanied by independent forecasts.

Repairing the UK’s trading relationship with Europe is another priority to boost investment and job creation. They also aim to work with international bodies to address corporate tax avoidance and promote higher global minimum corporate tax rates.

Finally, the Liberal Democrats propose developing an industrial strategy that provides businesses with certainty to invest in new technologies and create jobs. This includes re-establishing the Industrial Strategy Council for long-term oversight and evaluation. They also aim to support small businesses by abolishing business rates and replacing them with a Commercial Landowner Levy and expanding the British Business Bank to ensure small and medium-sized businesses have access to capital.

Technology

The manifesto outlines several policies with regards to technology and digital policy, emphasising the integration of technology into the economy, infrastructure, and business development.

The party propose increasing the Digital Services Tax on large tech companies from 2% to 6% of their annual profits, aiming to ensure these companies contribute fairly to the UK economy. Additionally, they intend to create a robust regulatory framework for artificial intelligence (AI) that promotes innovation while ensuring transparency, accountability, and unbiased use of personal data. The manifesto includes the negotiation of the UK’s participation in the Trade and Technology Council with the US and the EU to play a leading role in global AI regulation.

Another notable policy is the commitment to ensuring gigabit broadband accessibility for every home and business, including those in rural and remote areas. This infrastructure investment is part of a broader plan to boost economic growth and create jobs across the UK.

The manifesto also addresses digital literacy, setting a nationwide target to empower people and ensure that everyone can benefit from new technologies.

Finally, the Liberal Democrats want to introduce a Digital Bill of Rights to protect everyone’s rights online, including the rights to privacy, freedom of expression, and participation without being subjected to harassment and abuse online.

Health

The Liberal Democrats plans to “save the NHS” are central to their manifesto. These commitments are backed by reforms to capital gains tax and banking levies, which the Lib Dems have estimated will raise £9.2 billion for the NHS and social care per year, by 2028-29.

The Lib Dems have built their health manifesto commitments on the principle of “getting the basics right” including improved access to primary care, dentistry and mental health services. They include commitments to add 8,000 places to the GP workforce, to expand mental health support for young people and to review the NHS dental contract to reverse the NHS dental drain to the private sector. The Lib Dems have also committed the NHS to ensuring that100% of cancer patients receiving treatment following urgent referral within 62 days.

Wider proposals outlined in the Liberal Democrat manifesto include expansion of MHRA capacity to include timely access to innovative technologies and ringfencing future budgets for digital technologies including the replacement of outdated IT systems. Furthermore, the Lib Dems also commit to the publication of a range of 10-year plans for the NHS including on: NHS workforce, hospital infrastructure, and diagnostics.

Finally, on governance and oversight, The Liberal Democrats commit to the introduction of a “Patients Charter” which enshrines the right to a second opinion and secure data transfer. They outline plans to establish a “Health Creation Unit” within the Cabinet Office to coordinate a cross-Government approach to health inequalities, and the transfer of ministerial responsibility for Drugs Policy to the Department of Health and Social Care.

Social Care

On social care, the manifesto promises to ensure care is provided based on need, rather than ability to pay, aligning with NHS principles. Key pledges include funding free personal care for adults in England, raising minimum wage for care workers by £2 an hour, and overhauling the carers allowance system to create fairer assessments and support for unpaid carers. The party has costed their full health and social care package at almost £9bn a year (not including the potential savings to be gained through the reforms) to be raised through reversing tax cuts for big banks and loopholes in capital gains tax (again, cautiously calculated to account for behaviour change). £2.7bn of this will go towards their plan for free personal care.

Through raising minimum wage for care workers, establishing clear career pathways, and creating a Royal College of Care Workers to boost the importance of care work, the Liberal Democrats hope to address the crisis of recruitment and retention plaguing the sector and bring closer parity with similar NHS roles.

A Fair Deal for family carers will be prioritised, with an overhaul of the carers allowance system, an increase in allowance payments, and an expansion of eligibility for support. Caring responsibilities and care experience are also to be made protected characteristic under the Equality Act 2010.

A push for more personalised and independent care will be supported by piloting personal health and social care budgets, enabling greater control for individuals over what care they receive.

The party have also committed to developing a digital strategy for tech-enabled care delivery, creating a National Care Agency to set national minimum standards for care, and appointing both a Commissioner for Older People and Ageing, a long-time Care England ask, and a Minister for Tackling Loneliness.

Industry observers have noted that the costs outlined by the Liberal Democrats may not be sufficient to stabilise a system facing endemic financial challenges – although Sir Ed was emphatic that the party have carefully and conservatively costed their plans to ensure it’s a blueprint for others to follow. Their proposal for a “cross-party commission to forge a long-term agreement on sustainable funding for social care” has also been criticised as sidelining an issue fundamental to delivering effective and transformative reform in the sector.

Education

As part of their plan to prioritise education as the “best investment” in the potential of children, the Liberal Democrats have announced their commitment to supporting every child in developing the skills, confidence and resilience to be happy and successful. In setting out these commitments, education features significantly, with the Lib Dems promising to support children and young people at all stage – in early years, schools, further education (FE) and higher education (HE).

For early years, the Party has committed to increasing the quality and availability of childcare through investment in training and early years career qualifications. Additional commitments include tripling the Early Years pupil premium for disadvantaged children, as well as expanding parental pay and leave rights.

For schools, teacher recruitment and retention, teaching and learning and support for special educational needs and disabilities (SEND), and disadvantaged pupils are all to the fore. Commitments include reforming the School Teachers’ Review Body so that it is “properly independent of government”; creating a national body for SEND to fund support for children with very high needs; and introducing a Young People’s Premium, which will extend Pupil Premium funding to disadvantaged people aged 16-18. Regulation and mental wellbeing also feature in the manifesto, with a pledge to ending single-word Ofsted judgements, and the promise of a mental health professional at every school.

The Party also says it will invest at least 3% of GDP in research and development by 2030 and create new Lifelong Skills Grants worth £5,000 to support adult education, training and skills. Increasing apprenticeship starts is a key aspiration and the Lib Dems have guaranteed the National Minimum Wage and high-quality programmes for all apprentices, in addition to an FE funding review.

The Party has also committed to reviewing the financial system for HE and reinstating maintenance grants for disadvantaged students. Student support is championed by the implementation of a statutory duty of care and a mandatory Student Mental Health Charter, providing accessible mental health support. Internationally, the Party says it will bring the UK’s research back into Horizon Europe, join the European Innovation Council and re-join the Erasmus Plus programme as an associated country.

Built Environment

The party has outlined several key points in relation to housing and planning. In a pledge to ‘build the homes people desperately need’, the Liberal Democrats would seek to deliver 380,000 homes a year. The commitment has been in place since 2021 but was close to being dropped last year after a revolt of the party membership.

Alongside this, it would also see 150,000 social homes built each year and the construction of ten new garden cities and community-led development of cities and towns across the UK. This also means a pledge to protecting and investing in community assets and facilities.

To help achieve these ambitions a more localised approach with be at the forefront of any strategy, with the expansion of neighbourhood planning and greater funding for planning departments to improve planning outcomes just one of several policies aimed at giving control to local authorities.

Naturally, sustainability remains a consistent thread connected to the party’s policy in this area, with a sustained focus on brownfield development coming alongside increased investment in green housing and infrastructure. This includes proposals to launch an emergency Home Energy Upgrade programme for those on low incomes, expanding incentives for households to install solar panels and a boosted roll out of electric vehicle charging points.

Meanwhile, all new homes would be required to be built at a zero-carbon standard with solar panels, and requirements for landlords to upgrade the energy efficiency of their homes to EPC C or above by 2028, scrapped by Rishi Sunak last year, reintroduced.

Energy and sustainability

Bold in ambition for energy, the Liberal Democrat manifesto is light on detail. What it does do is give a good indication on how the Liberal Democrats will approach existing policy and their likely areas of focus in a new Parliament.

The manifesto commits to ensuring “90% of the UK’s electricity is generated from renewables by 2030”, falling just short of the Labour commitment for clean power by 2030. How they will achieve this, however, is less clear. The manifesto notes they would “remove the Conservatives’ unnecessary restrictions on new solar and wind power” and support investment in tidal and wave power, as well as green hydrogen, energy storage, pumped storage and batteries.

A considerable focus is given to home insulation, energy bills, and community power. Many of these policies are currently being consulted on by government – including commitments to “requiring all new homes and non-domestic buildings to be built to a zero-carbon standard” (Future Homes Standard) and “eliminating unfair regional differences in domestic energy bills” (something being explored in REMA).

It is a similar story for industry. With the Party committing to “implementing the Carbon Border Adjustment Mechanism” (which is currently under consultation), “supporting carbon capture and storage” for cement and steel (though no new support is announced), and “increasing the Industrial Energy Transformation Fund”.

However, there are some new, bolder, policies which give an indication of the party’s focus. An emergency Home Energy Upgrade programme, “with free insulation and heat pumps for low-income households”, a social tariff to provide targeted discounts, and a new subsidised Energy-Saving Homes scheme; a scheme which would pilot the best incentives for private home upgrades.

Another proposal is to decouple electricity prices from the wholesale gas price, something that many have argued would incentivise electrification and help pass the cost benefits of renewables onto consumers.

Overall, there is a greater role for communities across the manifesto. In energy, this includes a new Net Zero Delivery Authority to coordinate action across government departments and hand more powers and resources to local councils, empowering local authorities to develop renewables and storage capacity. There are also commitments to support small-scale suppliers and local grids. These will be key areas to look out for in new government policy – and are aligned with Labour’s commitment to a Local Power Plan.

Finally, on spending, detail is sparse though there is a commitment to implement a proper, “one-off windfall tax on the super-profits of oil and gas producers and traders” and an overall £8.4 billion commitment to energy and environment. This figure, however, covers everything from home upgrades to investment in grid, renewables, and nature rewilding.

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