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General election betting: things can only get better for Labour

By Matt | June 6, 2008

ROUTED at the polls. Criticised for his indecision. Presiding over Britain while the world’s economy goes south. No wonder the odds on Gordon Brown’s Labour Party losing the next general election are so short.

So surely betting on a Conservative Party election win is buying money? Well, perhaps.

In actual fact, for me, the odds on a Labour win at the next polls have got to the stage where they’re starting to look like an over-reaction.

Markets generally over-react to reality, one way or the other, and I think Labour might not be so fatally wounded as people think.

Lessons from political history
I can remember the Tories being in situations like this at regular intervals during the 1980s and early 90s – and yet they always seemed to be able to come back and win the most seats at the next general election.

Gordon Brown may well have lost Labour their aura of invincibility – and he may well lose the next election. But the bookies’ odds on Labour winning the most seats next time out are as long as 5/2 with Victor Chandler, which looks a little on the long side in a two-horse race.

That means the bookies reckon Labour have less than a 30 per cent chance of winning – but YouGov’s latest poll reports that the Government’s public support is 23 per cent.

Which sounds like the layers have priced things up correctly – until you consider that the same survey has David Cameron’s Conservatives with public support of 47 per cent.

That suggests a 33 per cent chance for Labour – even before you consider that, for them, the only way is up. (Of course, that’s assuming the Lib Dem’s are out of the race altogether – which, to be honest, they are. For the purposes of making a book on a British General Election, the yellows are currently playing the same role as the green does on a casino’s roulette table).

Brown’s window of opportunity
The “independent” Bank of England has plenty of time to engineer a window of economic boom in which Gordon Brown could bribe the electorate back to Labour – a tactic that has worked well for the Tories in the past.

Meanwhile, Brown has been revamping his communication team (which, admittedly, is still missing an Alastair Campbell or even a Peter Mandelson), and Cameron has yet to convince a generation of voters that the Tories can do government better than Brown’s lot.

And the effects of the credit crunch and the rest of the current global recession could well have played out by the time Brown calls the UK people to the polls – and a more economically confident electorate would be far more likely to vote Labour than today’s worried mortgage holders.

That thinking makes Labour look overpriced, and at 5/2 I’m prepared to start backing them. Things can only get better.

Selection