David Herdson reviews a new Betfair betting market
One of the most popular political betting markets over the last couple of years was who would follow Tony Blair as Labour leader, which given Blairâ€™s announcement that it would be during this parliament meant that person would also become the next Prime Minister.
Because of the dominant position Gordon Brown held as Blairâ€™s heir apparent, there were two key questions to that market: how likely was it that it would / wouldnâ€™t be Brown and if it wasnâ€™t to be him, who was it to be.
Betfair have now reintroduced a similar market, which theyâ€™ve helpfully renamed as Next Prime Minister – the Blairswitch market was on the next official leader of the Labour Party which caused plenty of scope for debate around the definitions. That should be avoided this time.
The next PM will almost certainly come from one of three distinct scenarios and itâ€™s probably helpful if the field of candidates is grouped into three sections to fit these. Firstly, if Brown were to fall under a political or health-related â€˜busâ€™, there are those people who have the political stature and position to replace him now or in the next two years; secondly, there are those within the Labour Party who could be in a position to replace him at some point after the next election should Labour win it; thirdly, there are those outside the Labour Party who could replace him if Brown serves through to a point when Labour is forced from power – and this could be either a straight election loss or a resignation in a hung parliament following or in anticipation of the loss of a vote of confidence. These scenarios could be loosely termed â€˜this generationâ€™, â€˜next generationâ€™ and â€˜Toriesâ€™.
Of the people who could replace Brown now, two obvious candidates stand out: Jack Straw and Alistair Darling. Both have been around for ages (together with Brown, they are the only survivors from Blairâ€™s first 1997 cabinet), and both hold or have held sufficiently senior positions without making a hash of them to give them the credibility needed to be serious contenders.
Even so, while political crises can blow up out of nowhere, Brown looks as secure as any PM has for a long time. Likewise, while heâ€™s not exactly a young man, every PM in the last century bar Major and Blair served at an older age, and his health looks good enough. Brown is likely to be the last PM from his generation.
For the next PM to come from the next generation of Labour MPâ€™s, Labour will first have to win the next general election, and that will have to be factored in to the odds. A hung parliament might be enough if Labour can stay in power for at least two or three years afterwards. By that time, David Miliband and Douglas Alexander are people that should be heading the list based on what theyâ€˜re doing now, although predicting that far ahead can be notoriously difficult (who would have picked John Major as next PM in 1984-5?). Parties in power needing prime ministerial material immediately are generally less concerned with picking youth and potential and more interested in experience and ability. Darling, Johnson, Benn or another from the current crop might still be in the running although were it to be one of them, it would be a very defensive move.
If not Labour, then David Cameron is the overwhelming favourite Indeed, he should probably be odds-on overall as a decent result in the next general election such as eliminating Labourâ€˜s majority should see him keep his leadership of the Conservatives. After that, the odds should lengthen dramatically (remember, the next Tory PM only counts if Brown serves through). Osbourne, Hague and Davis are all possible next Tory leaders but should be considered very much outsiders in this market.
There has been very little money traded on it so far, but this could be one of the more interesting markets over the next few years. It may also be worth watching for arb opportunities in conjunction with the â€˜most seatsâ€™ and â€˜overall majorityâ€™ markets.
David Herdson is a long-standing contributor to the site