LDV poll: 54% of Lib Dem members back ‘new approach’ to boost economic growth

Lib Dem Voice polled our members-only forum recently to discover what Lib Dem members think of various political issues, the Coalition, and the performance of key party figures. Some 500 party members have responded, and we’re publishing the full results.

54% of Lib Dems back ‘new approach’; 23% say ‘stick with Plan A’

LDV asked: Thinking about the Coalition Government’s economic policies, which of the following best reflects your view? (Compared to June 2012 results in brackets)

23% (-4%) - Borrowing more at a time when we already owe so much will simply make matters worse, as the country will have to pay back even more money in the longer term. We have to bring the debt and the deficit under control even if it has some painful effects for the economy in the short term

54% (n/c) – While it is right that we cut the deficit and I broadly support the government’s austerity measures, the frailty of Europe’s economies requires a new approach – we should take advantage of low interest rates to increase borrowing for capital investment to try and boost growth now

17% (+6%) – The government’s spending cuts and tax rises are hurting the economy. It should cut public spending less severely and less fast because trying to stimulate growth now is essential, even if that means we go on borrowing more for longer and adding to our national debt

5% (-1%) – Other

1% (n/c) – Don’t know / No opinion

With the Bank of England cutting the UK’s growth forecast this year to almost zero, a majority (54%) of Lib Dem members are calling for a new approach, with a focus on capital investment to kick-start the economy. Almost one-quarter (23%) say simply stick with George Osborne and Danny Alexander’s ‘Plan A’. There remains substantial support for immediate deficit reduction — both options 1 and 2 include that within their wording — but there is also a rise in support, from 11% in June to 17% this month, for a slowing down of the Government’s planned deficit reduction programme.

  • Over 1,200 Lib Dem paid-up party members are registered with LibDemVoice.org. Some 500 responded to the latest survey, which was conducted between 3rd and 6th August.
  • Please note: we make no claims that the survey is fully representative of the Lib Dem membership as a whole. However, LibDemVoice.org’s surveys are the largest independent samples of the views of Lib Dem members across the country, and have in the past accurately predicted the winners of the contest for Party President, and the result of the conference decision to approve the Coalition agreement.
  • The full archive of our members’ surveys can be viewed at www.libdemvoice.org/category/ldv-members-poll

* Stephen Tall is Co-Editor of Liberal Democrat Voice, and editor of the 2013 publication, The Coalition and Beyond: Liberal Reforms for the Decade Ahead. He is also a Research Associate for the liberal think-tank CentreForum and writes at his own site, The Collected Stephen Tall.

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18 Comments

  • Social Housing needed 100,000 needed- thousands of construction workers not working (or only only particially working).
    What better time to start to crack this problem??? Or shall we wait until another ‘boom’ time when labour costs rocket (so you get less for your £).
    PLUS as the Construction Industry has an ‘ageing’ workforce – i think 20% will retire in the next 10 years(????) – Appprenticeships – a big push would go some way to reduce unemployment too!!!!!!!
    Stick on solar power & or ground heat source pumps – help reduce CO2 etc etc….

  • Simon Titley 10th Aug '12 - 10:17am

    Only 23% (and falling) support orthodox economic dogma. That’s the best news I’ve heard all week.

  • Surely 71% support a new approach…

  • Mark Blackburn 10th Aug '12 - 11:21am

    @Henry Quite. Or are the 17% in favour of a new, new approach?!

  • Good news indeed. As Simon Jenkins points out, getting the Coalition to change its approach to economic policy is now the best chance we have of regaining some support and credibility:

    http://www.guardian.co.uk/commentisfree/2012/aug/07/nick-clegg-last-ditch-time-fighting

    (Ignore the bit about Clegg’s detailed plans for the HoL, which is Jenkins at his worst, jumping to an over-opinionated conclusion about something detailed which he hasn’t properly thought through. Read the rest, which is Jenkins at his best, doing the broad brush visionary thing, which is what he’s good at!)

  • Is this ‘new approach’ the same old policy that ran for the previous 10 yrs.?
    You know the one: it ended with an enormous recession and £1000,000,000,000 public debt?
    Since the govt. spending more money than it raised every year didn’t recession-proof economy over the past 10 yrs – it ended in the biggest recession ever – do you really think it will work this time?
    Even at the current record low interest rates, we spend more on debt interest than we do on Defence.
    If interest rates return to the historical norm it will match Education spending.
    When do we realise debt isn’t working for us? When we can’t pay the pension bill?

  • Daniel Henry 10th Aug '12 - 3:10pm

    If our return on the borrowed money is greater than the interest we pay then it’ll help reduce our deficit.

    Businesses don’t take up loans because they enjoy paying interest – the money they generate using the borrowed funds makes it worthwhile.

  • Daniel Henry 10th Aug '12 - 3:13pm

    I should also note that poor performance of the economy increases the deficit too, due to loss of income. A lack of borrowing may lead to a higher deficit if it damages the economy.

  • Probook – you are obviously among the (now minority) who are desperately clinging on to the tired old “orthodoxies”.

  • Peter Watson 10th Aug '12 - 3:37pm

    To what extent would this be not so much a “new approach” but more like the approach we told the electorate about in 2010.

  • The key word is ‘if’.
    Yes, if the return of the investment is greater than the cost then there is value to be had.
    We need to define how the debt will be paid for before we run up more.

    If govt spending in excess of income really gave the economy a tax-generating boost then we simply wouldn’t have been growing the debt for 10 years. At some point, the economic boost would have increased the tax revenues and we would have been in credit rather then deficit, and paid off the debt.
    But it didn’t, and we haven’t paid off the debt.
    What we have is a £1,000,000,0000,000 debt and a recession.
    After 10 years, those tired old orthodoxies (like ‘how are we going to pay for this’) are starting to look rather sensible.

  • Andrew Tennant 10th Aug '12 - 7:52pm

    Perfectly happy with additional, one off, capital and infrastructure spending, so long as:
    1) It represents value for money through significant return on investment
    2) It doesn’t come at the expense of higher tax rates or displacement of equivalent private sector demand
    3) It’s not ‘one off’ spending every year
    4) Revenue or long term spending is brought into balance and ideally below government income

  • I agree with Henry. My first thought on the survey results was that 71% support a different approach (thats 54%+17%).

  • Selwyn Runnett 11th Aug '12 - 10:53am

    I agree with John. Whilst we definitely need to get things moving with an infrastructure programme, this needs to be planned carefully. Some infrastructure projects have long lead-in times and so will have little effect in the short-term. Programmes such as affordable/social housing and broadband together with those infrastructure projects which are ‘on the shelf’ (where the planning and design phase has been completed) should take priority followed by the longer term projects. This then needs to be tied in to a bigger Growth Strategy (which Vince has been calling for consistently) so that the private sector can also invest – this means lending to small businesses and giving confidence in the prospects for the UK economy to those larger firms who are sitting on cash balances which could be invested. However, Osborne shows no sign yet of going down this road – another example of the ‘stupid party’. As Lib Dems we really do need start pushing and campaigning hard for a comprehensive Infrastructure & Growth Plan.

  • George, I don’t think the economic fundamentals have changed, merely that the coalition is now realising it was wrong with its Plan A, and wondering how to get out of it with minimum embarrassment! What it should be doing of course, is making public investment including sustainable jobs, with a substantial proportion of that devoted to green transformation of the way we live.

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