Friday, 16 May 2014

Nothing much to see here: the North East in 2015

The North East is the smallest of the English regions.  In political terms, it is certainly the least interesting.  25 of the 29 seats are held by Labour, mostly with towering majorities.  Even the most enthusiastic aficionado of politics would struggle to find five interesting constituencies for the next election.

I'm a natural completist, however, so I shall give the North East due attention.

The North East has a very different feel from London and the south east.  It has far lower than average wages and house prices that are a third of those in London.  On the other hand, the region has the most equal distribution of salaries in the country, with fewer workers taking home salaries in the bottom ten per cent of national earnings than anywhere else in the country.  GVA per head is only a little ahead of Wales and behind Northern Ireland, at just three quarters of the UK's national average. Between 2007 and 2012, unemployment rose faster than in any other UK region, to more than 10%, the highest in the country. It carried on rising throughout 2013 as well. From 2006/08 to 2010/12, median household wealth fell by 10% in the North East. No other region saw a fall.

The cuts have hit the North East hard.  When the coalition came to power, 25.7% of all employees were in the public sector.  That percentage has now declined to 21.4%.  This remains the highest percentage outside Northern Ireland.

All this leads me to believe that even if the Conservatives or Lib Dems recover in the polls nationally, they are going to struggle to make any headway in an area that has suffered much of the pain and seen none of the gain.

Here is the ONS's regional profile:

I've presented the seats in the region in a slightly different format:

Because the Conservatives are interested in so few seats in the region, a Conservative battleground is pointless.  Instead I offer you the seats in a standard presentation, with best odds detailed on those few occasions where it is relevant.  We only need to consider four of the constituencies: Stockton South, Middlesbrough South & East Cleveland, Berwick-upon-Tweed and Redcar.

Despite some recent signs of disarray in the ranks of the Middlesbrough Labour party, I firmly expect Labour to retain that seat for the reasons given above.  1/8 looks a very fair price on that prospect.  For the same reason, the Conservatives are going to have a huge struggle to retain Stockton South.  I don't like the look of the 7/2 on the Conservatives at all.  1/4 on Labour is probably decent value - I can easily imagine Labour taking this seat even if they make no overall progress next year.

So that leaves the two Lib Dem seats.  As I have previously noted, uniform national swing does not work where parties have suffered major drops in support. If as I believe the Lib Dems will tally moderate levels of support in untargeted seats, they are currently doing worse than uniform national swing in the seats that they are seriously contesting. The Lib Dems will have it all to do if they are to retain the seats they would hope to keep on a uniform national swing basis.

There's an big underround in Redcar, with Paddy Power and Ladbrokes taking radically different views of the seat.  Labour must be favourites, but Paddy Power's assessment that it's a 1/5 shot looks a bit too short to me.  1/3 looks more like it.  That means that bets on both the Lib Dems and Labour are value.  I prefer the Labour bet because it looks like a value winner rather than a value loser.

In Berwick-upon-Tweed, the incumbent Alan Beith is stepping down.  This should give the Conservatives a spring in their step in their attempts to take the seat.  But Labour unusually (for a Lib Dem/Conservative marginal) retain a vote share in excess of 10%, suggesting that the Lib Dems may have benefited less from tactical voting in the past than in some other seats.  In turn that suggests that there may be fewer 2010 Lib Dem voters who feel betrayed than in other Lib Dem seats.  That said, there was quite a sharp swing from the Lib Dems to the Conservatives at the last election and the Labour vote share has been declining over successive elections.  To my mind the odds are not far wrong.  I'm not betting on this seat at present.

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