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\n Photo by Jeff J Mitchell\/Getty Images.<\/p>\n
\n Photo by Jeff J Mitchell\/Getty Images.<\/p>\n
1. The Disunited Kingdom<\/p>\n
We don\u2019t talk enough about the SNP. After the party collapsed from 48 seats to just nine at the last general election and the unflashy John Swinney ended its rolling soap opera, much of Westminster switched off. But below the surface, the tremors of another earthquake can be felt. In May the party will almost certainly win a fifth term in office \u2013 a feat even the Conservatives never achieved at their peak \u2013 as it benefits from a split unionist vote. An unpopular Labour government, the fate that Anas Sarwar\u00a0always feared<\/a>, is dragging down its plucky Scottish wing (now in third place behind Reform).<\/p>\n When combined with the Greens, the SNP may also enjoy a pro-independence majority \u2013 polls show them comfortably surpassing the 65-seat threshold \u2013 an outcome that both parties will claim as a mandate for a second referendum (the Yes side hovers around 50 per cent).<\/p>\n Welsh Labour, meanwhile, the most electorally successful party in the democratic world, faces defeat in May for the first time in a century and could be reduced to single figures (from 29 seats at present). As in the recent Caerphilly by-election, expect anti-Reform voters to coalesce behind Plaid Cymru, allowing it to emerge as the largest party in a hung parliament and work with Labour and\/or the Lib Dems to achieve a governing majority of 49 seats. With three nationalist first ministers \u2013 Plaid\u2019s Rhun ap Iorwerth will join Swinney and Sinn F\u00e9in\u2019s Michelle O\u2019Neill \u2013 the Union will never have been more fractured.<\/p>\n Treat yourself or a friend this Christmas to a New Statesman subscription for just \u00a32 <\/p>\n Close<\/p>\n 2. The Brexit wars return<\/p>\n In 2026 a decade will have passed since the Brexit referendum (yes, that threw me too). Fittingly, then, the Europe question is returning to the centre of politics. A sea change in public opinion \u2013 56 per cent believe the UK was wrong to leave; just 32 per cent believe it was right \u2013 and a stagnant economy have encouraged erstwhile Remainers to challenge the status quo.<\/p>\n As I reported\u00a0a month ago<\/a>, Keir Starmer is under pressure inside government to back a new customs union with Europe. David Lammy and Wes Streeting are among the cabinet ministers sympathetic to the idea and 13 Labour MPs recently rebelled alongside the Liberal Democrats. The TUC, a bastion of pro-Europeanism since the days of Jacques Delors, is also attracted by the policy. Don\u2019t expect Starmer to embrace their cause: he has warned that it would \u201cunravel\u201d the UK\u2019s post-Brexit trade deals and his ally Nick Thomas-Symonds is spearheading an ongoing EU reset. But do expect several leadership contenders to champion closer ties as they pitch to a Europhile selectorate \u2013 a strategy that Starmer knows a thing or two about.<\/p>\n Some inside Labour might even begin to ask why \u201cBregret\u201d shouldn\u2019t become \u201cBrejoin\u201d, pointing to polls suggesting a majority of voters favour renewed membership. All too often this debate unfolds without reference to Europe \u2013 the UK won\u2019t be taken seriously as a repentant sinner as long as Nigel Farage is within reach of No 10 \u2013 but that doesn\u2019t mean it won\u2019t begin again.<\/p>\n 3. A creaking voting system<\/p>\n In 2025 the UK entered a new five-party era: Reform, Labour, the Tories, the Greens and the Lib Dems all now poll in double digits. Call it\u00a0the Netflixication<\/a>\u00a0of politics \u2013 rather than flicking between the BBC and ITV, voters are alighting on platforms tailored to them. Faced with such fragmentation, first-past-the-post \u2013 a legacy of the two-party age \u2013 is in danger of collapsing in on itself.<\/p>\n At the last election, Labour won 63 per cent of seats with just 34 per cent of the vote, the most disproportionate result in history; at the next one Reform could win\u00a0a near-majority<\/a>\u00a0of 313 seats with only 29 per cent. Nigel Farage, in a possibly related development, doesn\u2019t talk much about electoral reform now but in 2026 others will. For the first time, a majority of voters across all major parties now\u00a0favour change<\/a>. The insurgent Greens, heterodox Tories and the Lib Dems will champion reform, with Ed Davey\u00a0hinting<\/a>\u00a0that it could be the price of a future deal with Labour (whose conference has voted for proportional representation). Aspirant leaders might not go as far as Andy Burnham and back outright reform, but don\u2019t be surprised if ideas such as a new commission, comparable to that led by Roy Jenkins in 1998, take flight.<\/p>\n 4. Falling net migration<\/p>\n British politics has long been defined by the cross-party consensus that immigration is too high. \u201cSince we left the EU, immigration has more than doubled, completely against what the Conservatives and the Brexiteers promised,\u201d lamented Ed Davey at the last general election. \u201cWe had the \u2018Boriswave\u2019 didn\u2019t we?\u201d\u00a0remarked<\/a>\u00a0Keir Starmer a few months ago.<\/p>\n Net migration, recently revised upwards, is now estimated to have peaked at 944,000 in 2023 (the most liberal Brexiteers, sometimes sotto voce, always said numbers could rise). But this trend has since unravelled owing to stricter rules introduced by Rishi Sunak, such as a migrant salary threshold of \u00a338,700, and a fall in refugees from Ukraine and Hong Kong. As of June 2025, net migration \u2013 now almost\u00a0the only source<\/a>\u00a0of population growth \u2013 stands at 204,000, around the levels of the early 2010s.<\/p>\n In 2026 this trend is likely to continue as further changes announced by Labour take effect, including a ban on overseas social care worker recruitment (prompting\u00a0warnings<\/a>\u00a0of a new crisis), another increase in the salary threshold to \u00a341,700 and a 32 per cent rise in the Immigration Skills Charge. Could David Cameron\u2019s ill-fated target of reducing net migration to the \u201ctens of thousands\u201d finally be met? It\u2019s a question at least\u00a0worth<\/a>\u00a0asking<\/a>.<\/p>\n Reform, Labour and the Tories will argue that this is nothing less than what is required after years of excessive migration. But in 2026 expect pro-migration politicians \u2013 from the soft left to the liberal right \u2013 to find their voice as they riposte that the UK is unprepared for the economic and social costs of radically lower immigration.<\/p>\n 5. Higher taxes (again)<\/p>\n After Rachel Reeves raised taxes by \u00a341.5bn in her first Budget and by \u00a326bn in her second, you might assume that she has no cause to act again. But you\u2019d be wrong: at every turn, spending pressures abound. The government will need to pay for special educational needs provision from 2028 onwards \u2013 with a funding gap estimated at \u00a36bn \u2013 as it takes over responsibility from local councils. Defence chiefs are demanding faster progress towards the 3.5 per cent of GDP spending target. And higher than expected inflation threatens a new wave of public sector strikes in 2026.<\/p>\n Reeves might have increased her fiscal headroom to \u00a322bn, but the OBR warns that this remains a \u201csmall margin compared to the uncertainties around our economic forecast\u201d. When faced with a choice between breaking her fiscal rules or raising taxes, the Chancellor will always choose the latter. For any replacement, market stability would also be a defining early test. That\u2019s why, even with the tax take projected to reach a record high of 38.2 per cent of GDP, the next Budget could well see Labour come back for more.<\/p>\n This piece first appeared in the Morning Call newsletter; receive it every morning by subscribing on Substack\u00a0here<\/a><\/p>\n![](\"https:\/\/dl6pgk4f88hky.cloudfront.net\/2021\/09\/TNS_master_logo.svg\"){kind=logo}
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