On the 31 May 1990 a notice was issued to SDP National Committee members announcing a meeting scheduled for 3 Jun 1990 `to discuss the situation in the light of the Bootle By-election result' - a disastrous and humiliating result for the SDP who had been beaten even by Screaming Lord Sutch, the Monster Raving Loony Party candidate

At that meeting the National Committee came to majority decision that the SDP was no longer viable as national party and to suspend the constitution ; agreeing, after some amendment, to a statement to this effect tabled by David Owen. On 5 Jun the SDP President John Cartwright sent a letter to members which explained that `with the membership having dropped to just over 6000, and still falling, we simply did not have a satisfactory democratic base on which to continue the SDP' and which issued the agreed National Committee statement, which began: `Regrettably the National Committee of the SDP has concluded that the party no longer has levels of membership or popular support in the country sufficient to be able to sustain it as a democratically based national political party' . The statement went on to announce the decision to suspend the operation of the constitution, but explained that the SDP MPs would remain as social democrats in parliament, as would the SDP Peers and that the MPs would fight the next election as independent social democrats. Plans to revive the Campaign for Social Democracy to `help achieve some of the aims and values close to the heart of social democrats' were also referred to.

In a letter attempting to explain the decision to SDP members, David Owen used statistical evidence, pointing out that whilst on the 18 Jun 1990 the SDP had 6000, maybe 5000 members, by April 1991 this number would dwindle to 3000; he added that the SDP could no longer claim to be a democratic party, with less than half of its Area Parties functioning and Council for Social Democracy membership, supposed by the constitution to be 800, at Nov 1989 down to a mere 590, with many representatives unelected, being the only people who could attend.

At this time David Owen was undecided about his political future, despite media speculation as early as Feb 1990 that he was considering resignation. He did not announce his retirement from politics at the next general election until Sep 1991, at which time he had made no definite decision as to his future career, despite rumours of moves to the Labour Party, the Governorship of Hong Kong or a place in the Conservative cabinet. He did discuss with John Major the possibility of a Conservative cabinet position, but his insistence that he would only work with the Conservative Government as a Social Democrat, which would mean ensuring that Tory candidates would not stand against SDP MPs John Cartwright and Rosie Barnes, made this alternative impossible.

David Owen made his last speech to the Commons in Mar 1992. On his resignation he wrote to his supporters `Whilst the SDP no longer campaigns as a national party I believe our values and ideals live on and there is no doubt over the last decade we have greatly influenced the other political parties, moving them towards the centre ground. On that basis I think the SDP will be judged to have made a constructive contribution to British politics.'