The May election and business 6 Feb 2015
With so many of the political commentators convinced that May will be only the first election of 2015, I began to wonder what this really means in terms of business activity. Iain Dale of The Independent wrote (18 January, 2015):
“Britain is on the verge of months, or maybe years of political uncertainty. It would take three parties to form a coalition, and I doubt whether many of us can see that happening. A safer bet would be that no one could form a sustainable government and we could be in for a second election in the autumn which none but the main two parties could afford – and even Labour would find it difficult to raise the necessary money in such a short time. In the meantime, the markets will get the jitters and the fragile economic recovery could well be threatened.”
Does that mean that Private Equity houses should get a move on and try to deliver deals before May 7th? Well from where we sit, it certainly feels as though they are busy. I have had more approaches from PE firms looking at new deals so far this year than this time in 2014. Whether this has anything to do with the election in May or is just opportunism (i.e. interesting businesses at attractive prices) or an improved marketing strategy from me (!) is anyone’s guess.
However, as high profile business people express their views, will this encourage an apathetic electorate to vote to secure a majority government from one election?
Stefano Pessina has made headlines for saying that Ed Miliband’s plan for power was “not helpful for business” and “not helpful for the country.” He added: “if they acted as they speak, it would be a catastrophe.” This was of course wonderful for George Osborne to hear whilst the Labour party rallied round to call Mr Pessina a tax avoider and therefore not someone to be listened to.
However, I remain very nervous that if the May election does result in a hung parliament (and the latest survey from www.electionsetc.com states that there is an 85% chance of this) that business activity may suffer dramatically during this massive period of uncertainty. I suspect that domestic activity will not suffer so much but overseas customers may worry about doing business with the UK when there is no stable government.
What can we do?
Having now read a wide number of articles from political thinkers on the left, the right and everywhere in between, there appears to be a consensus that the two party political system we have operated in for so long is no longer fit for purpose. Surely we need to reform our political system in recognition of how party politics has changed? Long gone (and never to return, I suspect) are the days when the Conservative and Labour parties dominate entirely. Although in theory these two parties are ideologically polar opposites, in reality, they are not so different: they are both after the Centre Ground and so surely could find a way to work together for the good of the country which is surely what it is all about in any case?
There’s clearly not going to be an electoral change before May – but there is still something we can do. Surely we have a better chance of gaining a majority government in May if the turnout from the electorate is higher. Russell Brand’s argument that people should not vote is ridiculous and quite frankly is offensive to our forebears who worked so hard to make Britain a democracy. I would ask that you encourage everyone you know who is of voting age to get out there on May 7th and vote.