Opposition politics is finally back. Wherever the Liberal Democrats should be now, it isn’t left of Labour

The popularity and performance of opposition parties four and a half years out from a general election would not normally be of great interest. Nonetheless, there are serious reasons to pay attention to the revival of the British Labour Party under new leadership, and the less publicised competition for leadership of the Liberal Democrats.

The Johnson government may have a large working majority in parliament – 87 over all opposition parties – but failures in the handling of Covid-19 have led to a collapse in its credibility and trust among the electorate. There is already a growing appetite for plausible alternatives.

Until a few weeks ago, the assumption had been that the Conservatives had broken the back of the opposition and could expect to rule for a decade or more, but after Keir Starmer’s decisive victory in the Labour leadership contest, that pessimism is lifting.

The public has begun to appreciate the qualities in him which have long been apparent in parliament: he is a thoroughly professional, clever, well-organised and articulate performer who, as Labour’s Brexit spokesman, managed to navigate the treacherous rapids of his own divided party while building trust with Remain campaigners in other parties. Surveys suggest that Starmer’s personal approval rating (over 30 per cent net) runs far ahead both of that of his own party, and of the prime minister, Boris Johnson. He has already made a few good calls, taking a statesmanlike approach on Covid-19 and, latterly, sacking his hard-left frontbencher Rebecca Long-Bailey over her retweeting of an interview with an actor, published by The Independent, which contained her repetition of an antisemitic conspiracy theory.

But Starmer is still climbing in the foothills, far from the summit. His party’s biggest and long-standing problem is not being trusted on the economy.

Labour activists regard “austerity“ as a scourge to be fought and a term of abuse. The public does not appear to share this passion and sees the anti-austerity message as a sign of extravagance, a warning of higher taxes to come. The problem isn’t new; Tony Blair and Gordon Brown faced it also and had to fight the 1997 election on a firm commitment not to exceed the Conservatives’ frugal spending plans. For more than a decade, one of Labour’s proudest boasts was that it was top of the international class in economic management: “prudence with a purpose”.

Strange as it may seem to today’s Labour activists, the departing Labour government in 2010 had planned years of austerity to cut the massive budget deficit – a sin for which the Conservative-Liberal Democrat coalition was then demonised. Today the priority is a deficit-led recovery, but in four years’ time – with, hopefully, an improving economy but lots of accumulated public debt – Starmer’s main challenge as a prime ministerial candidate will be to explain why Labour is no longer “anti-austerity” but has rediscovered “prudence”.

He must also quietly bury a host of ideologically inspired commitments from the Corbyn era. Blair established his reputation for seriousness by ditching Labour’s traditional socialist belief in nationalisation. Starmer has, so far, gone along with the party’s instincts. The public appears to support pragmatic public ownership, as on the railways. But it will baulk at paying for doctrinaire takeovers.

Another good example of baggage is the Labour commitment to abolish or slash student tuition fees under the fee/loan system. This is a cause that has already inflicted grievous political damage on the Liberal Democrats, as a consequence of making promises that couldn’t be delivered in office. It is a policy that would starve universities of income and divert scarce public funds to highly paid graduates. It wouldn’t be progressive or sensible, but Starmer will require some political heroism to ditch it in preparation for government.

Starmer also faces the challenge from the other opposition parties. The problem in Scotland is especially dire. The dominant party until five years ago, Labour now has only one Scottish MP as against 48 members of the Scottish National Party (SNP). Its working-class base in central Scotland has been virtually wiped out.

Although the SNP government is showing signs of wear and tear in Holyrood, it will require an electoral miracle for Labour to get back to levels of support in Scotland that it commanded only a decade ago. Moreover, any attempt to team up with the SNP against the Conservatives would do enormous political damage in England. The best hope is to make some inroads into the central belt and hope that the Lib Dems can recapture Scottish seats from the Conservatives and Nationalists in the northeast and the Borders.

That complementarity of interests between Labour and the Lib Dems has much wider promise. A year ago, the Lib Dems were flying high with record wins in local government elections and big gains in European elections. Defections from Labour and the Conservatives were beginning, led by Chuka Umunna, the first of a clutch of brave and talented Remain rebels.

I handed over to my successor confident that the party was on its way back. That didn’t happen.

A creditably honest internal party report on the election recently described what went wrong. There were mistakes made, but the main problem was that widespread tactical voting by Remain voters simply didn’t materialise. Conservative Remain voters decided that Brexit was a lesser evil than a Corbyn-led government. Instead of the realistically expected 30 to 35 seats, the Lib Dems slipped backwards to just 11.

By contrast, the new political situation offers a more benign environment, and with it the chance of evicting the Tories from office. With a moderate, credible leader of the Labour Party, whom few could fear as a far-left radical, it will be possible for both centre-left forces in England to recover ground. My party has to remember it will do so not by outflanking Labour on the left, but by maintaining its acceptability to moderate Conservatives who want to see this government out.

The new leader will have to resist the illusory opportunity presented by recruiting a wave of disaffected Corbynites leaving Labour. Venomous, sectarian, far-left activists will (thankfully) never view the Lib Dems as a rallying point – and the party should not try to paint itself as one. Wherever the Lib Dems should be, it isn’t left of Labour. A particular test of political maturity will be demonstrating pride rather than shame in the coalition government. If ever there was an advert for the five years of coalition, it is the five hopeless, shambolic years that have followed.

There is a lot of overlap in the social liberal and social democratic values and traditions. Smart leaders understand – as Tony Blair and Paddy Ashdown did – that it is possible to compete locally or in some parts of the country and collaborate tacitly in others. Ideally, the voting system would be different but we and Labour have to recognise reality. Building on a strong local government base, the Lib Dems can win seats where Labour has no chance, just as Labour can win seats where the Lib Dems are out of the picture.

If both parties put tribalism aside, to concentrate their respective energies on where they can win, it could make all the difference in a tight election. With the Conservative government having snatched a premature decline from the jaws of its triumph last December, Sir Keir could do worse than to befriend the new Lib Dem leader when he or she is elected. A joint approach, turning their guns on a common enemy, could yet bring the Boris era to a welcome end.

Vince Cable is the former leader of the Liberal Democrats