The Economist Intelligence Unit democracy index has moved the UK up from 23rd place in 2006 to 21st place in 2008. Of course, this was before the government started nationalising the banks and arresting the Opposition.
Even so, the Civil Liberties strand has fallen in two years from 9.12 to 8.82; and the competition seems to be weakening anyway, as the 2008 report notes:
...following a decades-long global trend in democratisation, the spread of democracy has come to a halt. Comparing the results for 2008 with those from the first edition of the index, which covered 2006, shows that the dominant pattern in the past two years has been stagnation. Although there is no recent trend of outright regression, there are few instances of significant improvement. However, the global financial crisis, resulting in a sharp and possibly protracted recession, could threaten democracy in some parts of the world.