Now that a Tory Government is confirmed, what will the next 5 years look like?
The Tories have made significant promises on tax, with no rises in income tax, national insurance or VAT. However, with a commitment to deliver a budget surplus by 2018-19, this will have to be balanced against even deeper cuts than the last parliament, with £12bn of welfare cuts in their manifesto currently unaccounted for. They have also committed to increase health spending by £8bn a year by 2020 which will have to be balanced against this no tax rise promise and increased cuts.
Elsewhere, they have undertaken to extend right to buy to housing association tenants, provide 200,000 homes for first time buyers and extend Help to Buy – all designed to resurrect Britain’s ailing housing market. However, with official figures showing the Tory-led councils are less likely to approve housebuilding schemes than Labour it remains to be seen how impactful these policies will be.
For businesses, there is the business rates review to look forward to, the creation of 3 million further apprenticeships and the trebling of the provision of Start Up Loans. Coupled with additional investment in infrastructure, especially in the North, Midlands and East England, these are clearly designed to continue delivering the economic recovery the Conservatives were, throughout their election campaign, keen to remind voters they had delivered.
With the SNP delivering such a decisive victory in Scotland, devolution will be firmly on the agenda and David Cameron has already reiterated his commitment to deliver devolution as quickly as he can, and will look to implement the Smith Commission recommendations. Against this backdrop, English votes for English Laws will also need to be addressed but Cameron will have to make sure he can keep the Union together and not preside over further discord. We may see greater calls for electoral reform and a push for AV from the smaller parties, although this is unlikely to have much support from the larger parties.
Finally, one of the key commitments made by the Conservative Party is the promise to hold an EU referendum by 2017, after trying to renegotiate the terms of UK membership. All eyes will be on Cameron to see how he embarks on this negotiation and his timetable for this. With a significant majority of Tory backbenchers pushing for a Brexit, there is a risk that this could divide the party. However, the strength of the Tory victory may placate the party.
It remains to be seen how the Tories will manage in a government on their own. Unpopular policies will be harder to deliver with such a slim majority now that the Tories no longer have the Liberal Democrats to rely on.