by Atul Hatwal Yes, you read those words correctly. Hope. Labour election victory. More likely. The standout moments from the last year might seem like disasters – freebiegate, Winter Fuel Allowance, disability benefits – but away from these high impact political car crashes, the basis of future success is there and currently being largely ignored. […]
by Atul Hatwal
Yes, you read those words correctly. Hope. Labour election victory. More likely. The standout moments from the last year might seem like disasters – freebiegate, Winter Fuel Allowance, disability benefits – but away from these high impact political car crashes, the basis of future success is there and currently being largely ignored.
The case for optimism comprises three parts: what actually matters to the public, signs of improvement in these issues and the level of popular expectation of government and politics.
The various political woes that have befallen the government are real. They are largely self-inflicted and they do impact the public’s view of Keir Starmer’s competence. None of this deniable. But in terms of what really matters to voters , there are two preeminent issues: the cost of living and the NHS. The latest release from the Office for National Statistics’ public opinion survey is for May and the cost of living was cited as the most important issue by 86% of respondents, narrowly ahead of the NHS which was selected by 85% of respondents. For comparison, Immigration was at 59%. Wider data suggests that if voters are forced to only pick one issue (multiple issues could be selected in the ONS survey) the cost of living is the highest ranked issue by a wide margin over the NHS.
This is where voters will make a judgement on whether the Labour government has delivered for them. Most of the noise of politics is immaterial to the public. Either there’s good news in these two areas that is felt by voters, in which case, Labour will be well placed (as would any incumbent government) or there is not, and Labour will likely lose.
The evidence is that there has been solid progress on both fronts over the last year. This article by Tom Calver, Data Editor at the Times provides an excellent summary of the reality on the ground: Wages rising ahead of inflation and waiting lists coming down.
Rising wages, falling waiting lists: an unpopular take, but in a few ways, life in Britain has been (slowly) improving over the past year.
But it doesn’t feel that way — and that’s a problem for Labour
Free to read: www.thetimes.com/article/33c0…
— Tom Calver (@tomcalver.bsky.social) 29 June 2025 at 11:42
As the article states, these are incremental steps. It will take time for steady improvements to feed through into shifting public perceptions, but the direction of travel is clear.
The chart below by Giles Wilkes shows how Real Household Disposable Income (RHDI) continued to grow robustly last year. RHDI is a particularly relevant indicator because it gives us a single cost of living metric – income from working and other sources like pensions or investments, after inflation, and after taxes and benefits. More than any other measure, this is closest to telling us whether we’re getting richer or poorer.
I don’t have a particular explanation for why it pipped down a little in Q1 2025. I haven’t spotted an ONS article breaking it down, and should not be distracted diving into inflation tables. All I know is that if you smoothed the figures to a 4-Q average, this is your story.
Panic not. 3/
— Giles Wilkes (@gilesyb.bsky.social) 30 June 2025 at 15:14
Once again, a single year of good growth will not turn around voter perceptions but if – big if – it continues then the public will begin to notice. What’s interesting about the chart above is the correlation between election results and movements in RHDI.
In May 2015, David Cameron wins a narrow victory after presiding over shrinking RHDI in the early years of the coalition but then recovers with 3 years of growth. Theresa May goes to the polls in May 2017 following a huge one year drop in RHDI, where voters suddenly experienced a steep fall and were materially poorer. No wonder Jeremy Corbyn nearly won. In December 2019, Boris Johnson wins after two years of steady growth. That election might have been defined by Brexit but the result could have been very different if voters had been experiencing a drop in income growth comparable to the previous election. And in 2024, Rishi Sunak is wiped out following unprecedented pain in 2022-3. RHDI may have been rising strongly from the end of 2023 but the depth of the prior fall suggests he was doomed (though if he had waited until the last moment for the election, January 2025, he would have banked over a year of rising incomes which likely would have had some impact).
The lesson from the chart and borne out by the data going back to the start of the timeseries in 1955, is clear: If the government presides over consistently rising RHDI, it will tend to be re-elected. If people experience a fall in income, as occurred with Cameron, then a minimum of three years growth correlates with a recovery in political fortunes. If there is no absolute fall in income, two years of growth will normally be synonymous with re-election.
In a sense this should not be a revelatory insight. When people better off, they will be more inclined to keep the incumbent government in office. That voters today have higher real incomes and lower NHS waiting lists, albeit by small margins, than on day one of a Labour government, means re-election is likely to that bit nearer.
Even if these trends continue though, an issue at the next election could be if delivery is not sufficient against public expectations for higher incomes and a better NHS. Here the case for hope is underpinned by one of the most negative political developments in the past decade: the precipitous fall in public trust in politicians. There’s an ocean of data, quantitative and qualitative, that tells us voters don’t believe that their representatives or governing institutions are capable of delivering anything. Paradoxically, this means the bar for success is relatively low. A little something is comparatively quite a lot if the expectation is nothing.
Now imagine this: Keir Starmer’s government delivers four years of rising Real Household Disposable Income and improvements in NHS services before going to the polls in May 2028. The last time there was three years of RHDI growth was a decade ago, 2013 to 2015. The last time there was four years of consistent growth was twenty years ago, 2004 to 2007. The last time NHS waiting lists fell for two years or more was almost twenty years ago in the mid-2000s.
The OBR forecast for RHDI growth is an anaemic 0.5% per year but it is consistent, year on year growth for the next five years. It’s also worth noting their forecast of RHDI for 2024 significantly undershot what actually occurred last year. Forecasts of future NHS waiting lists are thinner on the ground but the NHS is the one area of government where spending is going to clearly increase in real terms and the evidence is that there is a huge political focus on these metrics.
None of this means the gaffes, errors and political pile-ups of the past year don’t matter. Two things can be true: Keir Starmer’s political management needs to improve but even if it doesn’t become transformed into a Rolls Royce operation, the election can still be won if RHDI keeps rising and the NHS keeps improving. The failure of the current political discourse is to fixate exclusively on the first while barely mentioning the second.
The parlous state of RHDI growth and rising NHS waiting times tracks much more closely to the rise of populism than most theories revolving around fundamental shifts in what drives voting or political master strategy from the likes of a Dominic Cummings. Delivery over the next three years, in these two areas, on what matters most to voters, would be the real game-changer. Small annual improvements might not make for headlines or heated debate, but the public hasn’t experienced anything like it for the best part of twenty years.
Atul Hatwal is editor of Labour Uncut
