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Coalition 2.0 fizzles out; big row in 2013 instead

July 4, 2012 4:16 PM

By Mark Pack

Originally published by East Midlands Liberal Democrats

David Cameron and Nick Clegg in Downing StreetThe original grand plans for a Coalition 2.0 this year are fizzling out, with little more than a Q&A session due to be held at the Lib Dem autumn conference.

Talk had been of a major new legislative program being drawn up for the second half of this Parliament, with some extensive preparatory work undertaken, not to mention lengthy internal party debates and a ping-pong exchange between the Federal Executive and the Federal Policy Committee in the Liberal Democrats over the procedure for debating the draft program. However, a combination of factors have seen these plans gradually whittled away until not very much is left.

In part it is the reality of being in government - things are taking longer than expected, so the original Coalition Agreement still has plenty of life in it as a source of policy plans. Moreover, the state of the economy is dominating the government's work and means there is very little scope for any policies that involve spending money.

In addition, for both Cameron and Clegg there is a strong incentive not to have a grand negotiation. For Clegg the calculation is simple: he is in a weaker negotiating position now than in May 2010 so the less that gets reopened the better. For Cameron a similar calculation exists, with a more internal focus - any new deal would up the pressure from his right-wing for him to deliver the sort of policies that a coalition with the Liberal Democrats would simply never agree. Having demands made of him that he could not meet would simply increase Cameron's party management problems.

As a result, the Liberal Democrat policy making focus over the summer is very much about the economy, with the new chair of the party's Federal Policy Committee, Jo Swinson, asking party members to send in their ideas on promoting growth. The Treasury too is hunting around for new ways to fund infrastructure investment, whilst both Nick Clegg and Vince Cable have been giving the sort of priority in their rhetoric to housebuilding that is unprecedented in the party's history. Rhetoric only so far; the summer policy making will see whether that becomes action too.

But if the summer and autumn of 2012 will therefore be spared big debates over the coalition's future course, 2013 is set to bring a huge battle: a new spending review.

Spending reviews are never easy when there is not much money to go round; throw in coalition politics too and the fizzling out of Coalition 2.0 becomes the calm before the storm.

The 2013 review will be a year earlier than envisaged in the original 2010 'Plan A', but the economy is not performing as was then planned. Moreover, the review will necessarily require widespread agreement between the two parties over much of government. Bringing it forward to 2013 leaves more time between it and the next election for the two parties to once again diverge somewhat and play up their differences.