The decline of the Liberal Party was dramatic and was never reversed. In 1906, the Liberal Party achieved its greatest electoral victory. By the end of both elections in 1910, the Liberals had to rely on the support of the Labour Party and the Irish Nationalists. Why was this decline in fortunes so sudden?
It is probable that the 1906 election victory disguised one simple fact that the Liberals could not have fought against. After the 1867 Reform Act, far more working class men could vote. This number was further increased after the introduction of the 1884 Reform Act. For years, the only party that seemingly represented the best interests of the working class man was the Liberal Party. The creation of the Independent Labour Party ended this and gave the working class their own political voice. When the ILP stood at their first general election in 1895 they made little impact - as would be expected from a novice party. However, by the 1900 election and the elections held in 1906 and twice in 1910, the Labour Party was starting make an impact in terms of MP's elected and votes gained. In 1900, the Labour Party got 62,698 votes. By 1910 this had grown to 505,675 - an eight-fold increase in just ten years. This was also matched with the growth of Labour MP's in Parliament - 2 in 1900 to 40 in 1910.
The First World War interrupted any further electoral advance for the Labour Party until 1918 when in the 'Coupon Election' the party got 2,245,777 votes - just under 21% of the total cast with 57 MP's elected. This growth in support was invariably at the expense of the Liberal Party. Conservative supporters stayed tolerably solid during this time and were not likely to change their support to the Labour Party. The Liberal Party had little that they could offer the working class that was not offered by the Labour Party.
However, the growth of support for Labour was not the only reason for the Liberal Party's decline. The party itself was a split force - the result of World War One. On August 1st and 2nd, Liberal Associations across the UK met and voted that the government should pass a resolution of neutrality. The Foreign Secretary, Lord Grey, believed that war with Germany was inevitable. The news of atrocities committed by the Germans in Belgium served to rally the people behind the government and there was general support for the Liberals when war was declared on August 4th. However, the split in the party was merely disguised as opposed to being repaired.
The Liberals had been the traditional anti-war party. The Liberals had even been split over the Boer War. Now they led the country during the world's greatest war. While the war remained popular and jingoism ruled, those in the party who felt that war was a necessary evil imposed on the government by the Germans could feel safe.
The government of Asquith was rocked by a 'shell scandal' of 1915 and as a result formed a war coalition with the Conservatives. To some the 'shell scandal' was a clear indication that the Liberals were not up to the job of governing the country in its hour of need. The failure of the Dardanelles campaign was also blamed on the government and many viewed the resignation of First Sea Lord Jackie Fisher as a sign of his frustration of working with the government.
To bolster the whole government of the country, the Conservative leader Andrew Bonar Law demanded a coalition. In this demand he found an ally in David Lloyd George - a Liberal. The internal manoeuvrings within the Liberal Party were already showing. In May 1915, Asquith agreed to Bonar Law's demand for a coalition. The Conservatives got few cabinet posts of any importance - Bonar Law himself only got the Colonial Office - but the Conservative media portrayed the whole issue as one in which the Liberals could not be trusted to run the country and to do so, they had to bring on board the Conservatives. The creation of a coalition, the shell scandal and the failure of the Dardanelles campaign did not bode well for the future of the Liberal Party.
The first coalition did have its successes. Lloyd George was made Minister of Munitions and there was a significant improvement in the supply of ammunition to the war front. Lloyd George was also a leading member of the Liberal Party, so this reflected well on both. But it was also Lloyd George who had wanted a coalition government at the expense of Asquith's Liberal government.
1916 also presented the government with the Somme offensive. This had been billed as the campaign that would end the war. Instead the Somme became famous for the sheer number of casualties on all sides. The failure of the Somme to achieve its stated aim also led to calls for conscription. A further split between Lloyd George and Asquith occurred over the issue of married men and conscription. Lloyd George threatened to resign if married men were not included in conscription. Rather than face such a situation given Lloyd George's status within the country, Asquith agreed to his demand.
During the Easter of 1916, Lloyd George, supported by the Conservative Party and the Conservative media, pushed for total conscription. Many in the Liberal Party were not keen on this but the Easter Uprising in Dublin gave Asquith the opportunity to introduce 'total conscription' without losing too much face to the man who was quickly becoming an obvious rival for the party's leadership.
In December 1916, Lloyd George felt sufficiently powerful to call for the creation of a 'War Council' that he would be in charge of. This would have taken control of the war away from Asquith who, as Prime Minister, would have taken charge of domestic affairs. Bonar Law supported Lloyd George in this but crucially a number of leading Conservatives did not follow his line - Lord Curzon, Lord Cecil and Chamberlain among them. Buoyed by this, Asquith refused to accept Lloyd George's call and Lloyd George resigned from the coalition to be followed by Bonar Law. For his part, to stamp his authority on both his party and the coalition government, Asquith also resigned fully expecting to be called back by both the Liberals and Conservatives. This did not happen. The king called on Lloyd George to form a new coalition government.
World War One effectively split the Liberal Party in two - those who supported Lloyd George and those who supported Asquith. The 'Squiffites' sat on the Opposition benches but they did not act in opposition. However, despite this situation, the party ostensibly maintained a single whip system - even if a different man represented each side. For Lloyd George, the Chief Whip' was Captain Freddie Guest. For Asquith, it was John Galland. Both men were allowed to canvass the other side, so the party saw this as a single whip system. However, nothing could disguise the fact that the party was on the verge of a major split.
Lloyd George's cabinet was mainly made up of Conservatives (the likes of Curzon and Bonar Law) while Arthur Henderson was the sole Labour representative. Lloyd George wanted Winston Churchill in the cabinet but the Conservatives vetoed this.
Lloyd George did not get things his own way. In early 1918, Major General Sir Frederick Maurice resigned as Director of Military Operations and attacked Lloyd George for not sending enough men to the Western Front and then misleading the House of Commons over the whole affair. Asquith saw an opportunity to attack Lloyd George and demanded a parliamentary enquiry. His motion was easily defeated (298 votes to 106) but only because the Conservatives supported Lloyd George. However, when the figures were analysed, 98 Liberal MP's voted for Asquith and only 72 for Lloyd George.
Some historians view this event as the one that effectively split the party. Officially, there was only one party with one party leader (Asquith) but Lloyd George had set up his own headquarters for his own staff.
When the war ended, Lloyd George tried to build bridges with Asquith by offering him the position of Lord Chancellor. However, Asquith wanted nothing less than the position of Prime Minister. As there was a clear split, Lloyd George decided to use the euphoria over the end of the war to call for an election.
Lloyd George decided to maintain the coalition into peacetime. All those who fought the 1918 general election and who supported the coalition were given a letter of support from Lloyd George and Bonar Law - the so-called 'coupon'. 159 Liberals were given the 'coupon' - those who had consistently supported Lloyd George. A Conservative candidate did not oppose a Liberal candidate who had been given the coupon. Conservative candidates opposed Liberal candidates who had not been given the coupon. All 159 Lloyd George Liberals won their seats. Only 26 'Squiffite' Liberals won a place in the Commons and Asquith lost his seat. Though the Liberal Party was not officially split, to all intents it may have well been.