Five thoughts on the UK General Election 2015 result

Huw Evans, ABI

This was an election result that combined the surprise of the 1992 exit poll with the drama of 1997 and managed to add even more to the mix. With three party leaders gone, Scotland turning away decisively from the UK parties and a swathe of household names ejected from Parliament, this will be an election that will define political campaigns for years to come.

But what are five thoughts we can take from it at this stage?

1. The old norms still count. We may have lived through the first digital election but in England and Wales, three of the oldest political norms held true. Voters went with the party that was ahead on both economic competence and leadership, they punished a minor coalition party and when faced with uncertainty, they tended towards the incumbent.
2. The future of the Union and the UK’s place in the EU are now centre stage. The Scottish vote is a final hammer blow to the 1999 devolution settlement which its architects always proudly claimed would keep the Scottish Nationalists marginalised for a generation.
   If the UK leaves the EU, the Scots will almost certainly leave the Union.
    Now, only a fundamental revision of Scotland’s place in the Union seems likely to be able to save it. This is interlinked with the debate which will now dominate British politics for the next two-and-a-half years; the UK’s membership of the EU. If the UK leaves the EU, the Scots will almost certainly leave the Union.
3. Labour has to confront its failure. Labour needs a fundamental debate about its political purpose, funding and leadership if it is to stand a chance of coming back from its abysmal result. In 2010, its leadership candidates talked a lot but ducked the level of honesty needed about how deep a hole it was already in. Its lack of business support and disinterest in wealth creation and aspiration was one of many factors used by its opponents to cast doubt on its viability as a future government.
4. The Conservative Government will still have to govern as a minority government. David Cameron’s achievement is a personal triumph for him and a vindication of his strategy.
   For the insurance industry, this is a Government we can work with.
    But being over the 326 finishing line is not the same as having the majority of 78 he had with the Coalition: John Major found a majority of 21 in 1992 quickly evaporated in practice. So Mr Cameron will still have to avoid legislation wherever possible and use the power of office to drive public policy, including through the business sector.
5. For the insurance industry, this is a Government we can work with. This is a government that will deliver Flood Re as agreed, be interested in further reforms to the Motor market and with which we have been working intensively to deliver the reforms to the long-term savings market. It believes in the London Market and wants to see the UK remain a global centre of excellence in insurance. But it will be far from business as usual with more emphasis on consumer initiatives, more changes to pension tax relief and the challenge to the UK’s membership of the EU.

So, this was a night of electoral drama that will begin an equally dramatic period ahead for the politics of the UK. There will be no sense of 'business as usual' from hereon in.

Huw Evans is Director General of the Association of British Insurers (ABI).