Is our two-party system on the way out?

It has survived past predictions of its collapse, but looks more precarious than ever.

“This time is different”. So often, hope finds a way to brush aside bitter experience. “This time there will be no boom and bust”. “This time HS2 will stick to its budget”. “This time Boris Johnson is telling the truth”.

Optimists, from Nigel Farage to Ed Davey, should, then, be wary of predicting that, this time, the days of two-party politics in Britain are over. However, before we conclude that the Labour-Conservative duopoly will either crash into oblivion or come storming back, let us assess the evidence.

The past century has been punctuated with claims that our party system would be shaken beyond recognition. Oswald Mosely had sat on the Commons benches as a Conservative (1918-20), independent (1920-24) and Labour (1924-31, including two years as a minister), before deciding that Britain needed fascism. He set up the New Party, hoping and expecting to end up as Britain’s Hitler. He was good at provoking riots, lousy at attracting voters.

Since the second world war, I can count six occasions when at least one poll has shown neither Labour nor the Tories in the lead: the Liberals in 1962, the Liberal/SDP Alliance in 1981-2 and 1985, Lib Dems in 2003 and 2010, and the Brexit Party in 2019. In each case, cue dramatic headlines.

Five of those occasions turned out to be no more than short-term blips: responses to by-election triumphs (Orpington in 1962, Brent East in 2003), convulsions in the Labour Party (1985), the “Cleggmania” frenzy following the first TV election debate in 2010, and the Brexit Party’s victory in the ultimately pointless European Parliament elections in 2019. In each case either Labour or the Tories regained the lead within weeks, sometimes days.

That leaves one occasion when the Lib-SDP alliance held its lead for longer: six months between October 1981 and April 1982. Twenty-eight Labour MPs defected to the new Social Democratic Party, which had been formed in March 1981. In September they agreed to form an electoral alliance with the Liberals. Optimism abounded, as David Steel, the leader of the Liberals, told his activists at their party conference: “go back to your constituencies and prepare for government”.

(My favourite memory of that conference was a huge rally held in Llandudno’s largest cinema, the night before the vote that sealed the alliance. Jo Grimond, the former Liberal leader, topped the bill. He was the MP for Orkney and Shetland. He told the rally that he used to be ferried between the islands at election time by the same boatman: “Knowing he had a captive audience, he would list all the Liberal policies that he hated. I would assure him that under no circumstances would any of those policies be enacted after the election’.” Grimond paused, and emphasising each syllable, said: “Fellow Liberals, I can no longer give that assurance”.)

For the next six months, the Alliance retained its lead over a Conservative government that had presided over rocketing unemployment, and a Labour Party that had lost some of its most prominent moderate voices.

In one respect, what is happening now resembles what happened then. Both main parties are in persistent trouble at the same time. Their joint unpopularity is not a short-term response to a specific event, but a blight that has persisted month after month.

But in another respect, today’s drama is very different. Reform is not leading the polls. All but two of the 38 surveys conducted in the past three months have shown Labour and the Conservatives as the top two parties. So far, Reform does not look like detonating the first real change in Britain’s party system since Labour overtook the Liberals in 1922.

And yet…. While we do not see a single third force overtaking both main parties, we see something that could be far more destabilising: three different parties (four if we include the Greens), each appealing to different groups of disaffected voters, able to win seats in different areas. The Lib Dems demonstrated this six months ago. Reform looks set to make significant gains at the next general election, even if it fails to overtake the Conservatives. And the SNP has a real chance of winning back a number of the seats it lost to Labour this time.

This week’s MRP survey in the Sunday Times projected that Labour would hold 228 seats, with the Tories winning 222, Reform 72, the Lib Dems 58 and the SNP 37, and the Greens slipping back to two. The survey was by More In Common, whose prediction of the seats won by the main parties was the closest of the MRP polls last July.

The significance of these numbers is not their predictive value – virtually zero this early in the parliament – but their demonstration that insurgency this time is taking on a completely new shape. In 1981, the Lib-SDP Alliance looked as if it might sweep either Labour or the Tories aside. As in the 1920s, when Labour replaced the Liberals as Britain’s mani anti-Conservative party, one duopoly would take over from another.

What is in prospect now is something completely different. The More in Common figures give Labour and the Tories 450 seats together, with 200 shared among the rest. This compares with 532-118 at last year’s election, and 567-83 in 2019. As recently as 1992, only 44 MPs sat on neither the Labour or Conservative benches; So the third force total has been tending to creep up over the years. Two hundred spread across a number of parties would take Britain into completely new territory.

With it comes the dismal poll ratings of the two main parties. Both have been stuck below 30 per cent since mid-November. Apart from a single month, December 1981, at the peak of the LibDem-SDP’s fortunes, we have never seen both main parties so unpopular at the same time. It is as if they have modelled their appeal on Woolworth, Debenhams and BHS – high street department stores that flourished in the 20^th century, but failed to respond to the challenge of niche stores and online marketing in the 21^st.

Indeed, is the multiplicity of niche challengers that marks out the big difference from the Lib-SDP Alliance. It claimed a distinctive political identity, but its supporters were all over the place. They projected their own idea of a perfect party onto the Alliance. Pro-Europeans thought it was on their side; anti-Europeans thought it shared their hostility to Brussels. Likewise on taxes, privatisation and nuclear weapons. Voters liked the Alliance because it was new, exciting and, sounded reasonable. That was all, but it was enough.

Until it wasn’t. Its glory months came to a sudden end in April 1982. That was when Argentine forces invaded the Falkland Islands. Politics acquired a sharper edge. Fluffy niceness was not enough. The Alliance’s support fell sharply and continued to slide. By December, it was down to 20 per cent, less than half the 47 per cent it had enjoyed twelve months earlier.

Today, instead of facing a single challenger with a blurred identity, Labour and the Tories face rivals with distinct brand appeal. Keir Starmer and Kemi Badenoch fight each other as if the battleground hasn’t changed. They must wish it hadn’t. Labour and Tory campaigners know how to fight each other.

In the end their tactics may continue to work. But maybe they won’t. All sorts of things could happen in the coming years. We shall have plenty of chances to return to this as the saga unfolds. For the moment, here are two provisional observations for the new year.

First, in the shortish term – up to the next election – First Past The Post (FPTP) will continue to shape life at Westminster. More in Common’s latest figures confirm its continuing power. It projects that Labour and the Conservatives would still win 71 per cent of all the seats between them, despite having just 51 per cent of the vote. Reform’s 21 per cent vote share would give them just nine per cent of the seats.

Unless votes move far more dramatically than they have so far, then we shall still have either a Labour or Conservative Prime Minister after the next election, even they remain struck below 30 per cent support. What is more, Labour has a built-in advantage. If we end up with a hung parliament, Starmer might seek to stay in office. To remove him, a majority of MPs will need to vote for a Tory-led government. Again, using More in Common’s figures to illustrate the point, there would be at least 330 MPs representing parties that last July were determined to kick out the Tories. If Reform and Ulster’s Democratic Unionist Party agree to back the Tories, the anti-Labour total would be less than 300.

But would Reform back the Tories if Labour slipped back further? Farage wants to lead Britain’s right-of-centre. Helping the Conservatives back into office is not the most obvious way of destroying them. My money – euros, naturally – would be that Reform would abstain on the key votes, effectively helping Labour, and then hope for an early second election at which they might brush the Tories aside.

Which leads to the second point. It is in the medium term that “this time it is different” really could come true. If two elections in quick succession both produce hung parliaments with neither Labour nor the Conservatives anywhere near a majority, then the nature and agenda of the post-second-election government would be up for negotiation.

In 2010 the Lib Dems persuaded David Cameron to grant a referendum on voting reform. By two-to-one, voters chose to stick to the status quo. Next time the politics of electoral reform could play out differently. On Monday, the i newspaper reported tentative discussions between Lib Dem and Reform MPs on joining forces to kill FPTP. Imagine that a minority Labour government after the next election struggles on for a year or two, calls a fresh election, hoping to restore its domination of a two-party system – but instead sees both Labour and the Tories lose seats, while Reform, the Lib Dems and others make further advances.

Here are two possible outcomes. First, Labour and the Tories, desperate to revive their duopoly and fearful of a new voting system that could crush them both, form a grand coalition. Other countries have had them – notably Germany and Austria. Improbable? Yes. Unthinkable? I’m not so sure.

Alternatively, the vagaries of First Past the Post could so discredit our present system, that a new government, possibly containing some odd bedfellows, could be established for a defined period, say 12 months, during which Parliament would legislate for a new, more proportional, system. This would come into effect – without a referendum – in the election held at the end of this short-term coalition.

I should stress that I am not predicting any of these outcomes. They are possible scenarios, no more. There are many others. The point is that the journey into Britain’s political future rests more than anything else on the fate of First Past the Post. Ten years from now, either FPTP will still be the way we elect our MPs, and the vast majority of them will once again be Labour or Tory – or today’s smaller parties will have grown and forced the death of FPTP. That would wreck the chances of either Labour or the Tories ever again forming a majority government.

All of which prompts the question: happy new year?