Buy low: Reflections on a week in Birmingham

If the Tory Party were a public company, market analysts would call it a value play. The stock is still low in the polls, but the fundamentals are strong, and key indicators are beginning to flash a buy signal. 

They’ve come a long way since last autumn. Back then the country’s oldest party was beset with betrayal, invaders from the Right, and Lib Dems making inroads in the home counties. This year they are able to laugh that off with an – admittedly quite funny – satirical mock-up of the Bayeux Tapestry and the most party unity they have enjoyed since pre-Covid.  

How did they turn things around? We put it down to four drivers: leadership, ideas, and Reform’s bad run and Lib Dems’ lack of direction. But any value investor will tell you that stocks that look cheap can remain cheap. So, each of these strengths comes with a new test. 

Leadership 

“Call it Kemistry.” 

Kemi Badenoch has made the moves that matter. The first was a change of tone at PMQs. A lighter, more playful approach to the weekly rigmarole has gone down well with politicos and the public, and it has made her more likeable. Anyone who thinks humour is wasted at the despatch box might take note.  

The second was Badenoch’s summer reshuffle. It promoted Andrew Griffith to Shadow Chancellor and put allies and fresh faces around her. It has given the party energy and, as this week showed, some substantial new ideas. Between them, the two moves cover what success in politics depends on: personality and personalities. 

And her speech on Wednesday reflected that. The procession of her team at the start was a show of unity. Explicitly saying “we actually like each other” left no room for interpretation, and contrasts with a Reform Party full of infighting and a Labour Party that just ousted its leader. This is now, she told delegates, the “no drama party.” 

Ideas 

The second factor is simple to describe, but hard to pull off: there has been some proper thinking within the party. 

Opening the conference with The Right Way was an inspired decision. The 95-page document, with its echoes of Thatcher’s Right Approach, put the argument before the programme. It sets out what went wrong and the principles that underpin their policies. Crucially, it represents a break from the party the electorate rejected in 2024. 

It gave the rest of the week a story for the policy announcements to hang from, from domes to homes. The ones worth watching are: 

• Inheritance. Badenoch’s set-piece announcement – letting people pass down their family home tax free – was a clever play. It avoids the comms trap of talking about thresholds and figures. Instead, she chose to pull on heartstrings by pinning the policy to family homes. The downstream impact on house prices and estate planning will be worth tracking. Critics will argue it encourages older homeowners to hold on to big houses rather than downsize, which would tighten supply. That is the line to watch if this makes it to the statute book. 

• Defence. The £10 billion Britannia Shield is another example of good communications. People understand what an iron dome is, and they can conceptualise the need to spend money on a missile defence system. The debate will rage on about whether it goes far enough, but it commits to significantly more than has been promised in the Defence Investment Plan. 

• The economy. There is clear blue water now between a spending Labour Party and a cutting Conservative Party. Andrew Griffith promised to cut a tax at every Budget and spoke more about his golden rule to get the deficit down, so the country can stop spending absurd amounts on servicing public debt. There is nothing progressive about that, so this is something all parties should get behind. 

• Infrastructure. Leaving the Aarhus Convention would remove the cap on legal costs that campaigners currently enjoy when they take big projects to judicial review. Environmental groups will fight it hard, but for anyone trying to build national infrastructure, it is a serious offer. 

• Young people. There were visibly more youngsters at this year’s conference, which could explain the improved vibes. With votes at 16 on the way, a pitch to this group could pay off, but the party starts from a long way back. Commitments to cut student loans and the halving of national insurance for 18–24-year-olds will help with this, but there is a way to go. 

• Nuclear. The pledge to deliver full fat Fingleton shows a clear direction of travel. Not everyone shared the enthusiasm, though. In fringe meetings, support for nuclear drew groans from renewables delegates and some economists who point out the high costs, risks and timelines. The sector’s task now is to keep the rest of the energy industry on side, rather than be seen to be winning at its expense. 

• AI and tech. AI didn’t get a set-piece announcement of its own, which speaks to a growing culture in Westminster where – despite the regular breakthroughs – the policy is falling in importance. In practice though, the Tory offer on AI sits within energy and planning. Datacentres need cheap power and quick planning decisions. The nuclear and deregulation agenda speaks to both. This argument will get louder as AI growth becomes a fight for grid access and local objections.  

Agree with it or not, this is a coherent package the party can campaign on. It gives them two years to make the case for running the country differently. 

Reform’s bad run 

The third factor is not of the Conservatives’ making. Reform’s conference did not go as planned. There was a long shadow cast by Channel 4’s investigation into ‘dodgy donations’ and the business day was reportedly dire. Meanwhile the Liberal Democrats were beset by questions about strategy and direction. 

But Farage and his party continue to live rent free in the mind of the Conservative Party. Rarely did a fringe meeting go by without someone asking whether a coalition with Reform is the morally right thing to do. After all, it would boot Labour out of office and – for the more cunning-minded – provide cover to deliver a more right-wing policy agenda. 

This schadenfreude comes with a health warning though. Tying your fate to the success or failure of others is not a strategy. But, for now at least, it does give Conservative spokespeople the confidence to dismiss the proposition. 

Now for the hard part 

Each of these strengths carries a test for the party as they look to prosecute a new plan for government.  

Take leadership – Badenoch consistently outperforms her party, and the Tory brand is still what holds the share price down. A popular leader can carry a party for a while, but there will come a moment of reckoning if these numbers don’t improve soon.  

Then policy – there was a lot of it. But that cuts both ways. With every pledge comes a target to attack and a trade-off that creates tension. What the party will need next are moments that cut through. Think David Cameron dragged by huskies or Tony Blair scrapping Clause IV.  

Finally, the opposition – Reform is down, but the party is not out. Nigel Farage has made a career of come backs in British politics. If he pulls off another recovery, and the Lib Dems find their north star, the Conservatives will need a plan for a genuinely multi-party contest. That plan wasn’t obvious in Birmingham this week. 

History adds a dose of realism too. No party has gone from a defeat on the scale of 2024 back into government at the very next election. After 1997, it took the Tories thirteen years and four leaders to get back into Downing Street. 

What it means for business 

Nobody knows when the election will come. The longer Burnham waits though, the stronger his opposition is likely to become. 

For businesses, that makes now a good time to engage. The shadow front bench is still developing its policies, and ministers-in-waiting have more time for a conversation now than they will in two years. In market terms, this is the moment to buy before the price moves. But it pays to be specific: 

• Bring them the regulation, line by line. Griffith has promised to set out his deregulation plan line by line, every bill and every regulation. Businesses that can name the specific rule holding them back, and show what changing it would unlock, will be pushing at an open door. 

• Do the costing for them. Under Badenoch’s golden economic rule, every pledge has to say how it is paid for. Proposals that come with the numbers attached, or that pay for themselves, will travel much further than requests for support. 

• Help them find their cut-through moments. If the party needs pictures as much as policy, a visit that makes a pledge tangible is worth more than another consultation response. That could be a stalled housing site, a factory in the nuclear supply chain, or a business tangled in red tape, especially in the seats the party needs to win back. 

• Use the Budget. John Healey’s first Budget lands on 28 October. The shadow Treasury team will want real-world evidence to respond with, and businesses that offer it early will be remembered. 

• Look beyond the front bench. Opposition teams are thinly staffed. The people writing the next manifesto, including Neil O’Brien’s policy renewal team and the think tanks that feed it, matter as much as the shadow ministers. 

None of this replaces engagement with the government, which holds the pen until the election. But businesses that wait for the polls to move before talking to the Conservatives may find the conversation has already happened without them. 

Which brings us back to the Conservatives’ market value. Badenoch is polling well, but her party isn’t. That gap is the value play: sound fundamentals held back by a (still) damaged brand.  

The political strategists in Birmingham will be asking whether the market corrects on its own. If it doesn’t, the smarter brains in her comms team may smash the glass marked ‘rebrand’ soon enough.