By Make Votes Matter Chair of the Board Susanna Dammann.

Last week, the Financial Times published a letter from more than 20 business leaders, warning about the damaging impact that the volatility caused by First Past the Post is having on the economy. 

“We consider that the electoral system no longer serves the interests of UK business in generating growth,” they argued, instead calling for a model that promotes dialogue and coalition-building. 

Over and over again, defenders of First Past the Post tell us that it promotes stable and effective governments. It’s enough to look back on the past decade in UK politics to see how little truth there is in this argument.

In the last 10 years, we’ve had six Prime Ministers and eight Chancellors of the Exchequer, with rumours swirling that those numbers could rise again before long. As the FT letter points out, the consequences of this run far deeper than the personalities involved. This constant churn leads to endless policy u-turns, projects started and abandoned, and uncertainty for business  discouraging the  investment and long-term planning, so badly needed at present. .

All this chaos didn’t happen despite our voting system but because of it. With the exception of the 2010 coalition government, every government since WW2 has been elected on a minority of the vote. More recently in 2015, David Cameron’s Conservatives got into power on just 37% of the vote. Now, Keir Starmer has a huge majority in the House of Commons on just 34% and record-low turnout of 60%. Even Boris Johnson won his landslide on well under 50%. 

When governments come into power on a fraction of the vote and impose their agenda without negotiating with anyone, it is little surprise that they falter and collapse. Such a weak foundation cannot sustain a serious programme for change. 

The First Past the Post  winner-takes-all system also means that each incoming government can reverse wholesale the policies of its predecessor. This actively discourages long-term thinking, pushing parties to prioritise the next election over durable reform. The alternative would be a more consensual model, where power is shared and collaboration is rewarded, creating the conditions for planning beyond a single electoral cycle. To achieve this, we needstructural change: a proportional voting system that promotes coalitions rather than single-party governments.

As our 2024 report Strong and Stable shows, countries that use Proportional Representation outperform those with majoritarian systems on a whole range of metrics related to political stability. They are less prone to early elections, their governments tend to be in power for longer and they have lower ministerial turnover. This fosters the kind of predictable policy environment that boosts business confidence and creates the conditions for sustained growth.

As Anna Dixon MP, a member of the APPG for Fair Elections, said yesterday at a discussion hosted by the Industry Forum, which I attended: we cannot have a thriving economy without political stability. Far from being a distraction from promoting growth and improving our living standards, electoral reform is a prerequisite for it. 

The members of the business community who were there, agreed that they have an important part to play in this conversation, and I hope this latest intervention will encourage even more to speak out. It’s time to send a clear message to the government: our dysfunctional electoral system is holding our country back. For the UK to be able to reach its true potential, we need Proportional Representation. And we need it before the next election: afterwards may be too late!