As economy begins to recover, Lib Dem members swing in favour of Coalition’s strategy

Lib Dem Voice has polled our members-only forum  to discover what Lib Dem members think of various political issues, the Coalition, and the performance of key party figures. More than 600 party members have responded, and we’re publishing the full results.

Lib Dem members swing in favour of Coalition’s economic policies

Thinking of the current state of the economy and the Coalition’s approach, which of the following statements is closest to your own view?
(Comparisons in brackets are with the last time we asked this question in March 2013.)

    15% (-5%) – Cutting the deficit isn’t enough: alongside public spending cuts, the Coalition should be aiming to stimulate growth through supply-side reforms (eg, de-regulation to make it easier for firms to hire and fire) and tax-cuts.

    41% (+15%) – The Coalition is right to keep its focus on cutting the deficit and limiting the UK’s debt: sustainable growth is only possible if we stop spending more than we earn as a nation, even if it is painful in the short-term.

    33% (-14%) – Cutting the deficit in this way is hurting the economy: the Coalition should ease public spending cuts and borrow more for capital spending to boost the economy, even if it does increase the UK’s deficit and debt in the short-term.

    8% (-1%) – Other

There has been a significant shift in favour of the Coalition’s economic policies since last we polled Lib Dem members on the economy. When LibDemVoice last asked (in March 2013) the single most popular option was what is often referred to as Plan B — slower deficit reduction and increased borrowing to fund spending on infrastructure — attracting almost half (47%) of members’ support.

Since then, of course, much has changed: the ‘triple dip’ recession didn’t arrive, the ‘double dip’ recession has been erased from history, and the economy is now forecast to begin recovering albeit very slowly. All this news has had its impact on Lib Dem members it seems. Support for ‘Plan B’ has dropped sharply by 13%: 1-in-3 members now think that the Coalition’s deficit reduction plans are ‘hurting the economy’. In contrast, 4-in-10 (41%) back the Coalition’s strategy ‘even if it is painful in the short-term’.

A minority (15%) believe the Coalition should be going much further down the route of supply-side reforms, such as de-regulation and tax-cuts. Of the 9% who selected ‘Other’, most favoured some combination of the three options, or put forward particular policy solutions.

Here’s a sample of your comments…

Labour intensive infrastructure projects should be brought forward thereby reducing the unemployment and welfare expenditure and providing housing, roads, rail including HS2 simultaneously. Stimulating growth by other reforms would only increase company profits without benefit to employment levels.

I disagree with first statement and partially agree with the second. I would like the coalition to build new social housing and a wide range of infrastructure projects.

They should stop demonising the poor (and we should stop ‘egging them on’) and tackle to scandal of corporate and individual tax avoidance.

We are also right to invest in infrastructure where this results in net savings in the medium to long term.

You can only spend what you earn, BUT at same time you can speculate to accumulate. Some well targeted infrastructure investment along side tight controls, simple really, as anyone would run their household or small business. I am generally happy with the way the coalition is functioning in this area.

The deficit should have been cut in 2011 by reducing all public sector salaries by 10%. This would keep them in employment but eliminate the deficit and stop the national debt growing to even more unsustainable levels. We can still do this in 2014, better late than never.

The Coalition should: – continue its focus on cutting the deficit, and – stimulate growth through supply-side reforms, and – be prepared to borrow for capital spending on infrastructure.

Austerity is essential to, but not sufficient for, growth. The government has been woeful on regulatory reform.

I have not seen a report on the deficit showing how much intrest on our deficit is being saved by public spending cuts.

There needs to be a more flexilbe approach, some of the social cuts have been to simplistic, the bedroom tax for example

The government has made miniscule progess on cutting duplication, waste and archaic structures in the public sector.

Current policies are slowing recovery, which means we are borrowing more anyway to compensate for low fiscal returns! It was always myopic to be too single-minded. Zealotry is just as dangerous in economic planning as in everything else, and Osborne has the wild eye of the missionary. Sorry, Danny.

I think the present state of the economy is our new way of life as other economies world wide enter the market at competitive rates. We must learn to live in the new circumstances and stop dreaming of Empire and the Victorian age.

Agree with Govts overall macro economic policy. They are correct to cut the deficit. However there should be much more emphasis on tax increases for the wealthy, particularly those who benefited from the property boom. Eg Land value Tax, Tobin Tax

We should be looking at ways of manufacturing things again. Look what a disaster relying on financial services proved to be.

The present policies are slowing down economic recovery, which is in any case forcing the government to borrow to make up for the shortfall in revenues.

It really makes sense to spend on infrastructure, whilst interest rates are kept so low, encourage infrastructure bonds that pay out 5% above bank rate in ten years or 3% above bank rate in five years. This would help to support many people who have lost out on their savings during this long downturn.

Whilst cutting the deficit is critical, the balance between 20% tax increases and 80% expenditure cuts is wrong. Lib Dems should be arguing for higher taxes for those who can most afford it to safeguard more services.

The Nick-Danny-Vince motion coming to Conference later this year gets the balance about right: we have to eliminate the deficit, since it is impossible to build a better future on unsound finances. However, that doesn’t mean that we couldn’t do it better without the Tories holding us back!

Too concerned with only one indicator-the deficit-not enough focused on other important measures-youth unemployment, long term unemployed AND totally ignoring the need to spread asset wealth

The government inefficiently spends money confiscated from individuals which they would put to more productive use themselves freed from government intrusion and interference.

Probably depends more on the overall world underlying situation and other things we can do nothing about like our cultural structure. A lot of this is the media anyway.

A classic LDV set of false choices. How about freeing local government to borrow against trading activities like housing by adopting the same accountancy rules as the rest of Europe?

I’m not an economist. I tend to the first answer. My main concern is, if there is to be pain, its not just the bottom 20% economically that suffer.

Tax cuts would increase the deficit but reforms to cut labour costs would benefit the economy as more workers could be employed and the welfare bill reduced.

The deficit may have been cut, but the debt is still increasing. We need investment aimed at giving medium to long term returns which we can use to pay off the debt! Equivalent to individuals buying dividend bearing stock.

The cuts should remain, but borrowing should be used to stimulate the economy with capital spend. A combo of options one and three, really.

Please tell the policy makers that Austerity/cuts wont balance the books – it’s a recipe for disaster – carried by the many low income families.

Get them to read ‘End this depression now’ by Nobel economist/Fomer BoE panellist Paul Krugman. Written by a technical authority in language that is accessible even by the Chancellor who is notorious for never having been an economist.

We, as a nation, are still racking up the national debt at an alarming rate. Cutting the deficit is not enough. We need to encourage small businesses and we have not done enough to sort the banks out so they will lend.

A combination of 2 & 3: we must cut the deficit on current account expenditure and keep an eye on the debt however there is scope to invest for growth through infrastructure etc

  • 1,500 Lib Dem paid-up party members are registered with Just over 600 responded to the latest survey, which was conducted between 19th and 23rd July.
  • Please note: we make no claims that the survey is fully representative of the Lib Dem membership as a whole. However,’s surveys are the largest independent samples of the views of Lib Dem members across the country, and have in the past offered accurate guides to what party members think.
  • For further information on the reliability/credibility of our surveys, please refer to FAQs: Are the Liberal Democrat Voice surveys of party members accurate? and polling expert Anthony Wells’ verdict, On that poll of Lib Dem members.
  • The full archive of our members’ surveys can be viewed at
  • * Stephen was Editor (and Co-Editor) of Liberal Democrat Voice from 2007 to 2015, and writes at The Collected Stephen Tall.

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    This entry was posted in LDV Members poll.


    • Darren Reynolds 1st Aug '13 - 12:50pm

      Rather than posting the swing as a % (e.g. ‘The coalition is right… +15%’), would you be able to post the absolute numbers of responders? This will stop anyone suspecting that going from 420/1600 to 410/1000 (+15%) is actually a decrease in absolute terms from 420 to 410, brought about because 600 of those who disagree have failed to renew their membership and thus aren’t responding to the questionnaire…

    • Tom Papworth 1st Aug '13 - 12:58pm

      The statement that “Whilst cutting the deficit is critical, the balance between 20% tax increases and 80% expenditure cuts is wrong” flies in the face of the economic literature on this topic.

      Where the government have gone wrong is implementing the tax rises up front while delaying the spending cuts, and relying too heavily on cuts in capital spending rather than revenue spending.

      If you want to see government money-multipliers, you should shift spending away from welfare and into infrastructure, within whatever spending envelope you choose.

    • Tom Papworth 1st Aug '13 - 1:08pm

      “Get them to read ‘End this depression now’ by Nobel economist/Fomer BoE panellist Paul Krugman. ”

      I don’t think Krugman ever sat on the MPC, if that’s what you mean (apologies if BoE isn’t Bank of England).

      Also, Krugman is not a macroeconomist; his Nobel was for his work on the economics of trade (where, as an ardent advocate of free trade, he is very good and a real must read).

    • Michael Parsons 2nd Aug '13 - 5:01pm

      Free Trade?
      The closure of the Ford transit factory in Southampton means production is moving from Swaythling to Turkey thanks to the European Investment Fund. This results from the European Investment Bank offering a €190 million loan for Ford’s relocation last December. Over 500 British workers are set to lose their jobs thanks to this closure, it seems.

      As to “Debt reductoin” this simply deflates the economy – tax used to cancel “bank loans” is simply money destroyed – a fact that can’t be emphasised too much! And as to the infrastucture fantasies, it depends who does the work as to what effect that spending might have -and what it is for e.g. if it is for easier “international trade” this simply pushes us further down the path to a warehouse and assembly economy, and if the contracts are given to foreign firms (like Vince’s railways seem to be) local skill creation and competitiveness are set even further back.

      Economics is at best a pseudo-scince – its assertons the result of navel-gazing and unverifiable. If I assert that that the post-1870 UK economic depression was the result of the excessive importation of chinchilla furs, no way can we rerun history to test that! Non-parametric statistical manipukation is not hard scientific evidence by a long chalk, and in history events occur only once. We need to organise the end that we will, or foreign capital will have its way, but not as we might choose.
      Governmenbt expenditure and increased debt needs to be consciously targeted on local production and civil welfare.

    • Matthew Huntbach 3rd Aug '13 - 8:54am

      Someone quoted in this article:

      We, as a nation, are still racking up the national debt at an alarming rate. Cutting the deficit is not enough. We need to encourage small businesses and we have not done enough to sort the banks out so they will lend.

      Small businesses are failing because people don’t have money to spend on their services. When people feel economically squeezed, they trend to go for the cheapest option in things they have to buy, which is generally that offered by the largest suppliers who use economy of scale. Small businesses may be able to offer better service and more quality and diversity, but if you are on a tight budget, you’ll not be bothered with all that. Many of the areas where it might once have been viable to start up a small business have gone because of the dominance of the big providers – an obvious example being that no-one now would start up a small bookseller, and existing ones are closing, because of Amazon. If people are financially uncertain, they will not want to take the risk of starting a small business. It seems to me this constant message about starting small businesses is coming from very wealthy people at the top of society who just don’t realise how hard life is for people poorer than they are.

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