Is this the dawn of a new coalition?

Published in The Mail on Sunday (March 17th, 2013)

Picture the scene as Nick Clegg strides purposefully to the podium in the Downing Street rose garden. With the sun shining down on the massed ranks of media squashed in to watch this historic occasion, even the weather seems a portent for the unfolding new era.

Beside him is another tall man in a sharp suit, a big smile on his face as he jokes with Clegg and joshes with reporters. The heat of the Election campaign has dissipated, replaced with the camaraderie of a new Coalition set to govern Britain for the next five years.

Just days ago, this pair of politicians were calling each other every name under the sun in fiercely fought televised debates. Now they have put aside personal differences, ironed out political divisions and come together, they say, for the nation’s common good.

The questions come thick and fast from journalists intrigued by this historic new Coalition. One television reporter provokes huge laughter and embarrassed looks from the politicians as he reminds the new Prime Minister of a cruel joke he made about his deputy.

But Ed Miliband does not really mind, even though he failed to win his predicted majority. For the date is May 12, 2015 and he has returned Labour to power after just five years in opposition, ousting the bickering Tories as governing party in alliance with a shrunken rump of surviving Liberal Democrats.

This is, of course, a political fantasy – and a nightmare for David Cameron. But if you believe the polls, it is a scenario that looks increasingly plausible.

If it does turn into reality, will this weekend be seen as when the Coalition between Labour and the Lib Dems – a long-cherished dream for many on the Left – began to take shape?  

The two parties have joined forces to drive through new laws to shackle newspapers. So we face the strange spectacle of the Deputy Prime Minister working with the Leader of the Opposition to defeat the Prime Minister on a critical parliamentary vote tomorrow.

Clegg’s attitude to the press has hardened in recent weeks, infuriated by bad headlines over his party’s inept handling of sex-pest claims. He believes – wrongly as it happens – that he was victim of Tory-inspired dirty tricks to damage his party during the Eastleigh by-election campaign.

Many at Westminster are observing events with immense interest, wondering if they are watching the first steps in the evolution of our next government.

Miliband has long had a good relationship with Vince Cable, a former Labour activist who has looked as if he sat on a scorpion since joining Tories at the Cabinet table as Business Secretary. Cable texted Miliband to congratulate him on his first party conference speech as leader, since when they have communicated regularly.

In recent days, Miliband and his team have warmed to Clegg as they worked together on proposed press laws. This marks a significant change, since the Right-leaning Lib Dem leader has been a hate figure in Labour circles after his post-Election deal with Cameron.

One Labour insider admitted they had been won over in meetings. ‘Clegg is tough, clear about what he wants and eloquent,’ he said. ‘I had a prejudice against him, but have to admit he has been impressive.’

The source said this was the first time the two party leaderships had worked so closely together, sharing documents and traipsing into each other’s offices. ‘There have been two or three moments when we have had to take a leap of faith and trust him,’ he added.

So if this is the start of a blossoming relationship that will burst into flower in the Downing Street garden in two years’ time, what will the consequent coalition look like?

It is a question rebellious Tories sniping ceaselessly at Cameron would do well to consider. For a start, it would be the end of austerity.

Cable is already calling for more borrowing to fund growth measures, while the Labour leadership of Miliband and Shadow Chancellor Ed Balls cut their political teeth under the profligate Gordon Brown.

This might necessitate a rapid  U-turn for the Lib Dems. But it is one they have already executed before on entering Coalition three years ago, when they ditched pretty much everything they stood for previously on the economy.

It is easy to envisage a joint agenda with measures to soak the rich, bash bankers and redistribute wealth. We would see a big levy on expensive properties, restoration of a 50p top tax rate and introduction of a controversial ‘Tobin tax’ on financial transactions.

Miliband expects Clegg to be ousted before the Election, giving the Lib Dems a five-point bounce in the polls. This would allow him to make Cable Shadow Chancellor in a coalition – and to shunt the pugnacious Balls into a less prominent post.

Whatever happens, the gravitational pull in the Lib Dems is to the Left. Most activists would feel more comfortable with Labour, despite their discipline during their alliance with the Tories.

As one senior Conservative speculated, while the Lib Dems love to say they are restraining the current Coalition from veering Right, a Lib-Lab pact might shift sharply Left since both parties would want to claim credit for redistributive measures.

This could lead to a bidding war for populist policies to ‘reshape capitalism’ that bruise the economy, damage the City of London and drive away wealthy people, as seen in France under its floundering president Francois Hollande.

On issues such as immigration control and benefit reform, Labour knows it must harden its message, as Miliband proved in a party political broadcast earlier this month. Yet neither party really believes in such things, so we could expect tough talk but minimal action.

Likewise on Europe, the Lib Dems would find far more common ground with Labour than with their current partners, who want to rip up human rights legislation and repatriate powers from Brussels.

Whoever is leader, the Centre party would revive its infatuation with electoral reform and constitutional change, although many Labour MPs are surprisingly hostile to Lords’ reform since it could challenge the supremacy of the Commons.

A Labour-Liberal Democrat coalition would also strengthen the hand of those on the Left who oppose hardline security measures such as secret courts and identity cards.

Inside Labour, a battle is raging over whether to continue Blair’s tough approach on civil liberties; on this issue, Balls and his wife Yvette Cooper, Shadow Home Secretary, are firmly on the side of the Blairites.

Finally, it might just turn out to be the greenest government ever. Miliband was converted to this cause during his tenure as Climate Change Minister, while the yellow rosette of the Lib Dems has long had a green streak. This would mean more subsidies for renewable energies and wind farms, tough decarbonisation targets and perhaps the reining in of plans to expand gas power production and shale gas development.

Only time will tell if this fantasy turns into reality. But as Miliband and Clegg finalise their tactics for tomorrow’s key vote and the freeze between their parties starts to thaw, will we look back at this weekend as the moment that marked the start of the first national coalition between Labour and the Liberal Democrats for close to a century?

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