A House Divided

Introduction

In the political climate of October 2025, the United Kingdom finds itself at a peculiar juncture. The echoes of the 2024 general election, which saw the Labour Party sweep to power with a commanding majority and the Conservative Party suffer its worst defeat in modern history, have not faded ^{14, 35}. Instead, they have given way to a new and complex chapter of political introspection and internal strife for both the victors and the vanquished. While the Conservative Party conference in Manchester was intended to be a moment of reset and renewal, it has instead laid bare the profound divisions and existential anxieties gripping the party ^{14, 26, 40}. Polling released to coincide with the event has sent shockwaves through the Tory establishment, revealing a grassroots movement deeply disillusioned with its leadership and increasingly open to a radical realignment of the British right ^{2, 21}. Simultaneously, the Labour government, now more than a year into its term, is discovering that the challenges of opposition pale in comparison to the burdens of governance ¹⁶. A significant internal dispute over the direction of economic policy has emerged, pitting the fiscal prudence of the leadership against the ideological convictions of senior cabinet members, threatening the unity that was so crucial to the party's electoral success ⁷. This period is therefore not merely one of political adjustment but of fundamental crisis for both major parties. The Conservatives are grappling with a potential schism that could redefine right-wing politics for a generation, while Labour confronts the age-old dilemma of how to balance its social democratic principles with the pragmatic demands of a fragile economy.

The Conservative Reckoning: A Party on the Brink

The annual Conservative Party conference of October 2025 convened in Manchester under a pall of gloom ^{14, 43}. The atmosphere was not one of a government-in-waiting plotting its return to power, but of a party struggling for its very survival ⁴⁰. Recent polling painted a grim picture, with the party languishing in third place behind both Labour and Reform UK ¹⁴. The event itself felt hollowed out, with empty stalls and a noticeable absence of the usual throng of protestors, a sign, perhaps, of the party's fading relevance in the national conversation ⁴⁰. It is within this context of decline and demoralisation that the party's internal fractures have become starkly visible.

The Spectre of Reform: An Unsettling Poll

The most startling revelation to emerge during the conference came from a YouGov poll of Conservative Party members, conducted between 26 September and 2 October 2025 ^{4, 22}. The findings were described by commentators as "brutal" and exposed a chasm between the party leadership and its grassroots ²¹. The poll indicated that nearly two-thirds of Tory members, 64 percent, desire an electoral pact with Nigel Farage's Reform UK, wherein the two parties would agree not to stand candidates against each other in key seats ^{2, 10, 21}. Even more radically, close to half of the membership, 46 percent, would support a full merger of the two parties, with 48 percent opposed ^{4, 10, 21}.

These figures represent a profound ideological crisis for a party that has long prided itself on being the natural home of the British right ^{11, 33}. The willingness of such a large proportion of its core supporters to entertain, and even actively desire, a union with a rival populist party signals a deep-seated dissatisfaction with the current direction of the Conservative Party. It suggests that for many members, the ideological distinctions between the two parties have become blurred, or that the perceived threat of a long-term Labour government outweighs any remaining loyalty to the Conservative brand in its current form. The sentiment was articulated by the Conservative MP Andrew Rosindell, who publicly called for a pact, arguing that the current electoral system cannot accommodate two broadly conservative parties without ensuring a split vote and the "calamity" of another Labour government ².

The Roots of Discontent: A Fractured Right

The current flirtation with Reform UK is not a sudden development but the culmination of years of ideological drift and internal conflict within the Conservative Party. The process of leaving the European Union, a cause championed for decades by figures like Nigel Farage, was eventually adopted and delivered by the Conservatives under Boris Johnson ^{3, 35}. This act, while securing a significant electoral victory in 2019, also fundamentally altered the party's ideological centre of gravity and legitimised many of the populist positions long associated with Farage ³.

The subsequent years of political turmoil, including the brief and economically disruptive premiership of Liz Truss and the historic defeat in the 2024 general election, have left the party ideologically adrift and searching for a coherent identity ¹⁴. Many grassroots members, particularly those who joined during the Brexit era, feel that the party has failed to deliver on the promises of a more robustly conservative agenda, particularly on issues such as immigration and public spending ¹⁷. This sense of betrayal has created a fertile ground for Reform UK, which presents itself as the true inheritor of the Brexit spirit and the authentic voice of disillusioned conservative voters ³². The party's platform, focusing on themes of national sovereignty, stringent immigration controls, and lower taxes, resonates powerfully with a segment of the electorate that the Conservatives can no longer take for granted ¹⁷.

The Farage Factor: Reform's Enduring Appeal

The central figure in this political drama is, undoubtedly, Nigel Farage. Having finally won a seat in the British Parliament in the 2024 election after numerous attempts, his influence has never been greater ³. He has successfully positioned Reform UK not merely as a single-issue pressure group but as a viable alternative to a Conservative Party that many on the right now view as tired and ideologically compromised ^{3, 32}. Polling among Tory members reveals the extent of his appeal: 53 percent hold a favourable opinion of the Reform UK leader ¹⁰. In a direct choice between Kemi Badenoch and Nigel Farage for leader of the Conservative Party, a third of members (34 percent) would choose Farage ¹⁰.

Farage's strategy has been to exploit the Conservatives' perceived weaknesses, arguing that they have become indistinguishable from Labour on key issues and have failed to capitalise on the opportunities presented by Brexit ³. He has effectively argued that the Conservative Party's attempts to move onto his territory on issues like immigration only serve to highlight their own lack of conviction, with voters preferring "the original to the copy" ³. This dynamic has created an ideological split within the Conservative Party, with some advocating for a more robustly right-wing platform to counter the threat from Reform, while others fear that such a move would alienate more moderate voters ¹⁷.

An Alliance or a Takeover?: The Practicalities and Pitfalls

The debate over a pact or merger is not merely ideological but also intensely practical. Proponents argue that a divided right-wing vote makes a return to power virtually impossible under the UK's first-past-the-post electoral system ². They point to the 2024 election results, where Reform UK's presence on the ballot paper arguably cost the Conservatives numerous seats, as evidence of the destructive potential of a split vote ³. In a hypothetical hung parliament, 73 percent of Tory members would welcome a coalition with Reform UK ²¹.

However, the path to such an alliance is fraught with difficulty. The current Conservative leadership, including Kemi Badenoch and senior figures like Shadow Justice Secretary Robert Jenrick, have publicly ruled out any form of pact, viewing it as a sign of weakness and a betrayal of Conservative principles ^{10, 23}. A merger would be even more complex, raising fundamental questions about the party's name, constitution, and policy platform. It would likely trigger a fierce internal battle between the party's more moderate, one-nation wing and its increasingly populist, right-wing faction ³⁸. Such a move could fundamentally transform the Conservative and Unionist Party, which traces its origins to the 17th century, into a new entity, potentially alienating a significant portion of its traditional support base in the process ^{11, 31}.

A Leader Under Scrutiny: The Badenoch Conundrum

Compounding the party's ideological crisis is a profound lack of confidence in its current leader, Kemi Badenoch. Having taken the helm after the 2024 election defeat, she has struggled to make a positive impression on both the party membership and the wider electorate ^{14, 18}. The YouGov poll conducted for Sky News delivered a particularly damning verdict on her leadership ²².

The Poll's "Brutal" Verdict

The survey revealed that half of Conservative Party members (50 percent) do not want Kemi Badenoch to lead the party into the next general election, while only 46 percent believe she should remain in place ^{2, 22}. There is also significant doubt about her ability to survive in the role until then, with 49 percent of members believing she will be replaced before the country next goes to the polls ²². This represents a critical failure of leadership, as a party leader who cannot command the loyalty of their own members is in an exceptionally weak position.

Interestingly, the poll also found that a majority of members (61 percent) believe she is doing a good job as leader, compared to 37 percent who think she is not ^{4, 8}. This apparent contradiction suggests that while members may approve of her day-to-day performance and policy stances, they harbour serious doubts about her electoral appeal and her ability to lead the party back to power. Her personal favourability ratings with the general public have been poor, with a May 2025 Ipsos poll showing only 17 percent of the public holding a favourable opinion of her, against 49 percent with an unfavourable view ¹².

Badenoch's Contested Mandate

Kemi Badenoch's leadership is caught between the competing factions of her party. She has attempted to chart a course that appeals to both the traditional and populist wings, but in doing so, she risks satisfying neither. Her rejection of an electoral pact with Reform UK is a clear attempt to assert the Conservative Party's independence and ideological distinctiveness ²¹. However, this stance is directly at odds with the wishes of a large majority of her party's members ^{2, 21}.

Her struggles are reflected in the quiet and subdued atmosphere of the party conference, where her image was notably less prominent than that of past leaders like Margaret Thatcher ⁴⁰. This suggests a party unsure of its current leadership and clinging to the perceived glories of a bygone era ⁴⁰. The lack of energy and enthusiasm at the event underscores the scale of the challenge she faces in revitalising the party and presenting a credible vision for the future ¹⁴.

The Shadows of Contenders

The uncertainty surrounding Badenoch's leadership has inevitably led to speculation about potential successors. The same YouGov poll that revealed the depth of dissatisfaction with her leadership also identified a clear favourite to replace her ^{8, 21}. Shadow Justice Secretary Robert Jenrick is now the preferred choice of the membership, comfortably beating Badenoch in a head-to-head contest by 46 percent to 39 percent ^{21, 22}. Jenrick, who lost to Badenoch in the previous leadership contest, has publicly insisted that he is backing the current leader and that there is no vacancy ^{4, 8}. However, his popularity with the grassroots makes him a significant figure and a potential rallying point for those who are dissatisfied with the party's current trajectory. The poll also indicated that former Prime Minister Boris Johnson remains a popular figure, chosen by 22 percent of members as their preferred leader, highlighting a persistent nostalgia for the pre-2024 era ^{4, 8}.

Labour's New Dilemma: The Burdens of Power

While the Conservatives grapple with the agonies of opposition, the Labour government is confronting the harsh and complex realities of power. After more than a decade out of office, the party is now responsible for navigating the UK through a challenging economic period, characterised by modest growth, persistent inflation, and strained public finances ^{16, 19, 34}. The government's attempts to address these challenges have exposed deep ideological fault lines within the party, leading to a significant internal conflict over the direction of its economic policy.

The Wealth Tax Rebellion: A Clash of Ideologies

The focal point of this internal strife is the forthcoming autumn budget, which is expected to be delivered by Chancellor Rachel Reeves on 26 November 2025 ²⁷. Faced with a significant fiscal deficit, estimated to be between £30 billion and £40 billion, the Treasury has been exploring various revenue-raising measures ⁷. While the Labour manifesto pledged not to raise the main rates of income tax, National Insurance, or VAT, the government has already implemented or proposed a series of other tax changes, including applying VAT to private school fees, abolishing the non-domiciled tax status, and increasing windfall taxes on energy companies ^{13, 16, 20}.

However, reports have emerged of a significant cabinet revolt against proposals for further tax rises targeting the wealthy ⁷. Senior ministers have reportedly told Prime Minister Keir Starmer and the Chancellor that they believe the government has already gone too far with measures targeting businesses and high earners ⁷. These ministers are urging a change of course, arguing that further wealth taxes, such as a proposed property tax on high-value homes or a new bank profits tax, would be counterproductive ⁷.

The "Anti-Aspirational" Charge

The core of the criticism from within the cabinet is that the government's fiscal strategy is becoming "anti-aspirational" ⁷. One minister was quoted as saying, "The trouble is we have crossed a line in trying to encourage aspiration. The non-dom change and the VAT on school fees have sent the opposite message" ⁷. This critique strikes at the heart of the "New Labour" project that Keir Starmer has sought to emulate, which was built on reassuring middle-class and business voters that Labour was no longer a party of high taxation. The concern is that by targeting wealth and success, the government risks driving entrepreneurs and high-net-worth individuals out of the country, ultimately harming the economy and reducing the overall tax take ^{7, 46}.

This internal debate reflects a classic tension within the Labour Party. On one side are those who believe that fiscal prudence and a business-friendly environment are prerequisites for economic growth, which in turn funds public services. On the other are those who prioritise the redistribution of wealth and believe that the richest in society should bear the greatest burden in addressing the country's economic challenges. The Chancellor herself has appeared to side with the former, rejecting calls from the left of the party for a direct wealth tax on assets over £10 million, arguing that such policies are "unproven" and could lead to capital flight ¹⁵.

Starmer's Balancing Act

For Prime Minister Keir Starmer, this internal dispute represents a significant political challenge. Having worked tirelessly to present Labour as a united and disciplined party in opposition, he now faces the difficult task of maintaining that unity in government, where hard choices must be made ⁴⁷. The pressure to deliver on promises of improved public services is immense, but the economic reality limits his room for manoeuvre ^{16, 29}.

The government is caught between its pre-election promises and the fiscal situation it has inherited. The Institute for Fiscal Studies and other think tanks have pointed out that Labour's spending plans appear to exceed its anticipated revenue, creating a fiscal gap that must be filled either by borrowing, spending cuts, or further tax rises ²⁰. The Chancellor has hinted that further tax rises are likely, stating that the "world has changed" since she previously ruled them out, citing increased global borrowing costs and trade tensions ⁴⁸. However, any move to increase broad-based taxes would risk a public backlash and would likely intensify the ideological battle within her own party ^{29, 45}.

The Economic Inheritance

The context for this difficult debate is an economy that, while not in recession, is experiencing only sluggish growth. Forecasts for UK GDP growth in 2025 are modest, hovering around 1.2 to 1.3 percent ^{5, 36}. Inflation, while down from its recent peaks, is expected to remain stubbornly above the Bank of England's 2 percent target for the remainder of the year, at around 3.8 to 4 percent ^{5, 30, 34}. Business investment has been weak, partly due to global uncertainty and the impact of previous tax increases ^{30, 36}. Public sector net debt remains high, at over 96 percent of GDP ³⁴. This economic backdrop provides little scope for expansive public spending and forces the government into a position where it must consider unpopular fiscal measures to balance the books. The cabinet revolt over tax policy is therefore not just an ideological squabble but a direct consequence of the difficult economic inheritance that the Labour government is now managing ^{19, 29}.

Conclusion: Two Parties at a Crossroads

The autumn of 2025 has revealed a British political system in a state of profound flux. The two parties that have dominated the nation's politics for over a century are both engaged in intense internal struggles that will define their futures and shape the country's political trajectory. The Conservative Party is facing an existential crisis of a magnitude not seen in generations. Its membership is deeply divided, with a powerful faction openly advocating for a political union with a populist rival that threatens to consume it. The party's leadership lacks the authority to quell this rebellion, and the path back to electoral credibility appears long and uncertain. The very identity of British conservatism is being contested, torn between its one-nation traditions and the powerful allure of right-wing populism.

The Labour Party, in contrast, is grappling with the challenges of success. Its substantial parliamentary majority has not insulated it from the ideological tensions that have historically plagued parties of the left. The debate over taxation and economic strategy is more than a simple policy disagreement; it is a fundamental conflict over the party's core purpose and its relationship with wealth, aspiration, and the market. The government's ability to navigate this internal conflict while managing a fragile economy will be the defining test of its first term in office. The parallel crises gripping both parties suggest that the political realignments that began with the Brexit referendum are far from over. The future of the two-party system, the ideological direction of both the right and the left, and the United Kingdom's path through a period of economic uncertainty all hang in the balance.