Why we need a Lib Dem-Tory alliance

It’s time to strengthen the liberal-right in British politics.

Nearly two years into the coalition, both of the governing parties are promoting their distinct identities to garner supporters. This is because the Conservatives want an outright majority. The Liberal Democrats just want survival.

But as David Laws commented in a keynote speech to Bright Blue this week, now is not the time to stress differentiation and split the coalition. A better strategy - for both parties and, most importantly, for the country, especially in this period of economic turbulence - is to stress the shared agenda of the two partners and the longevity of the current government.

In actual fact, it's time to seriously consider a long-term relationship, even a merger, between the two parties which lasts beyond 2015. The liberal-right needs a strengthened political identity in this country, to dilute the influence of ideologues and reactionaries, and to maintain progressive policy-making.

The Conservatives face a weak opposition and Cameron is popular with the electorate. But it is not enough. Polling by Michael Ashcroft of voters in key marginal seats shows that those who failed to give the party the votes they needed for a majority, are still sceptics today. Low-income women and ethnic minorities are particularly doubtful. Teaming up with the Lib Dems would help reassure such voters that the party really is decontaminated, modern and liberal-minded.

The Lib Dems can never govern alone. They rely on coalitions. The problem is, transferring from one party to the other looks like flip-flopping, and they will be punished by voters. Their best hope of long-term influence lies in a merger with one of the major political parties. A liberal-right alliance would be consistent with their Gladstonian traditions and allow greater distinctiveness and influence than a Lab-Lib pact.

Finally, and most importantly, the country would benefit from a new liberal-right alliance. The truth is, since the 1990s, most senior minsters and civil servants have subscribed to economic and social liberalism: a belief in a competitive, market-based economy with protection and enhanced opportunities for the most vulnerable.

So all recent governments have sought low taxes, light-tough regulation and private sector engagement in public services. But, at the same time, there has been commitments to tax credits, enhanced investment in hospitals and schools, better workers' rights and a determination to protect personal freedom. This consensus on policy-making has - apart from notable anomalies - been followed by Cameron, who followed Blair, who followed Major.

Yes, there are problems with our economy and our society. More still needs to be done. But these liberal, pro-market reforms - based on close inspection of evidence - have made this country, slowly but surely, better. Satisfaction with our health service is at an all-time high. Educational standards are up. Crime and levels of poverty are down.

But the liberal-right - on the modernising wings of the three main parties - who are open to evidence and passionate about progress are under constant pressure from ideologues, who are nervous and uncomfortable about the direction of modern Britain. To keep these voices happy, archaic and ridiculous narratives, as well as ill-considered policies, are often trumpeted.

So, for example, we have Cameron proposing a transferable tax allowance for married couples, a throw-back to the 1950s which will do nothing to boost marriage rates. Clegg, meanwhile, went into the last election calling for the scrapping of tuition fees, despite the fact that the new funding arrangements have not harmed university access for the most deprived. In the Labour party, there is stubborn opposition to private sector involvement in the health service, despite a wealth of evidence illustrating that increased competition enhances the performance and efficiency of hospitals.

Such thoughtless policy positions are championed simply to gratify unthinking, prejudiced viewpoints, which spread and are slavishly adhered to in political parties. Ideologues that enjoy the belligerency and tribalism of politics rise up the ranks and wield too much power, distorting steps to social and economic progress.

A new liberal-right alliance could change that. There would, of course, be room for those on the modernising wing of the Labour Party. Those who are passionate about good policies and open to new ideas, not dogmatists and tribalists, would be more influential. And the silent majority in this country - who simply long for a better life for their families, whichever party is in power - would benefit from a new sort of politics: discursive, progressive and evidence-based.

Ryan Shorthouse is the Director of Bright Blue

Ryan Shorthouse is the Director of Bright Blue, a think tank for liberal conservativism 

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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.