The Tories are ramping up the price of Clegg's boundary sabotage

Keeping the moribund review alive is part of a wider strategic game of coalition negotiation.

The Guardian has an interesting story this morning on Conservative attempts to resuscitate plans to redraw parliamentary boundaries. Unnamed Tory sources have suggested recruiting MPs from smaller parties – Democratic Unionists, Welsh and Scottish Nationalists – to help tip a vote in favour of redrawing constituency lines ahead of the next election, now that the Lib Dems have demonstrated their intent to kill the idea.

The other parties sound pretty tepid towards the idea, but they leave some room for crude pork-barrel bargaining. That is how small parties roll if they want to get things done.

Senior Tories are clearly desperate to salvage the boundary changes, which could make a difference of as many as 20 seats in their favour. But I sense that, amid all this frantic reaching down behind parliamentary sofa cushions for spare votes, there is a recognition that the 2015 general election will be conducted on existing boundaries. The candidate selection process is under way, strategists need to think about targeting resources, incumbents want to get on with the business of digging themselves in for a defensive battle.

So what is really going on here? Partly, the argument is about preserving the boundary review from total oblivion. A crafty manoeuvre in the Lords has meant that Labour and Lib Dem peers could kick the whole thing beyond 2018. Six years hence is as good as never in politics.

So the Tories will at least want to put pressure on Nick Clegg to find some compromise that means the changes can be at least settled in principle with implementation only deferred until just after 2015.* That way the Lib Dem leader gets to retain the glory of the bloody nose he inflicted on Cameron as revenge for the PM’s failure to secure reform the House of Lords but the Tories get the reforms they badly need for the long term onto the statute book.

Leaning on Clegg certainly seems to be the motive for leaking and briefing the Tories’ various plans to keep the boundary review alive. Not so long ago a far-fetched idea surfaced according to which the Lib Dems might reverse their opposition to the new constituencies in exchange for state funding of political parties. It was a non-starter and Clegg’s allies hosed it down with scorn. The whole purpose of floating it at all appeared to be to maximise Lib Dem discomfort and flush out some measure of their biddability.

After all, the Tories have been in coalition for long enough to know the Lib Dems are up for negotiation on most things. Downing Steet may initially have underestimated Clegg’s determination to retaliate over Lords reform but they know there will be other things he wants and things he needs to show his party and his country as prizes. The Tories must also know, however, that it would take some quite spectacular policy bauble - as yet unimagined - to permit Clegg to turn around and say, on second (technically third) thoughts, he is backing the boundary changes again.

There are parallel policy negotiations and horse trades going on all the time. In the run-up to the Autumn Statement – a mini-review of spending priorities due on 5 December – those talks are getting more urgent and heated. It is worth noting, in that context, that one effect of briefing that the boundary changes are not yet dead is to remind everyone of their importance to the Tories and, by extension, the heavy penalty Clegg has inflicted for the loss of his precious elected Senate. In other words, these stories and rumours about boundary deals ramp up the sense of Tory grievance, which is one way to shift the balance of power in various other negotiations. "Sorry Nick", say Cameron and Osborne. "But you hit us so hard on that boundary changes thing, you’re not seriously going to kick up a fuss over these welfare cuts/pesky windmills etc. are you? Be reasonable!"

I don’t doubt that the Cameron and Osborne are determined to reform parliamentary boundaries. Nor do I doubt that they’d like it to happen in time for the next election. It won’t and they must know as much. They can, however, make absolutely sure the Lib Dems know that, in smashing this most precious Tory policy, they have used up a very large chunk of their coalition bargaining chips and are in no position to come asking for policy favours.

*This distinction is a bit of a red herring as it transpires. See first comment below.

Update: A senior Lib Dem source has been in touch.

 

Nick Clegg pledged to veto the proposed boundary changes after David Cameron abandoned plans for House of Lords reform. Photograph: Getty Images.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

Photo: Getty Images
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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR