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Ed Miliband could be PM within three years. Here’s how

If AV fails, the Lib Dems will have little cause to remain in the coalition, writes Charlie Falconer

"I am not going to lie to you - it is bad," said the polling expert Paul Whiteley, of the University of Essex, at a fringe event during the Liberal Democrat spring conference in Sheffield. The party's best hope of recovery, he added, was to pick fights with the Conservatives and call for a slowing down in the pace of spending cuts.

The current analysis at Westminster is that the coalition is in no danger of breaking up, because the consequences for the Lib Dems could be catastrophic. If they left the coalition, they would open the way for a vote of no confidence in the Conservative government in the not-so-distant future. This would be followed by a general election, in which the Lib Dems, according to the polls, would lose half their seats.

But this argument for why the coalition will not break up holds good only for as long as the party and its activists believe that a worse fate awaits them if they leave the coalition than if they stay in it. And it appears that the Lib Dems are shifting on this.

Increasingly, it seems that the Lib Dems misinterpreted the message that the electorate gave them in May 2010. The message was that Labour must give up power and the Tories should take over as the main force in government - on the basis that the Lib Dems would keep them on the straight and narrow. Above all else, this meant that the Tories should not be allowed to give effect to the unchecked impulses of Thatcherism in their economic policy. Sound economic management had to be tempered by an understanding of the importance of community and by staying on the side of hard-pressed families who were in work, wanted to continue to be in work and wanted their children to grow up in a safe environment and with a reasonable chance of getting on in the world.

Clegg for mercy

Since then, the coalition has defiantly embarked on a deficit reduction programme that is even more unbridled than the cuts of the 1980s. Nick Clegg's pupil premium and the raising of the tax threshold so that some of those on low incomes pay nothing are drops in the ocean. Clegg's embarrassingly implausible speech in Sheffield underlined how exposed he is. He said that he was standing up for "alarm-clock Britain", denied that the coalition was a cuts government and attacked any council that made cuts for political reasons. When he blamed Labour councils for the cuts, his words felt like those of a drowning political leader clutching at a concrete-lined lifebelt. Advancing an argument that no one believes won't save him. The party's broken promise on tuition fees demonstrated how the Lib Dems are being pushed to the margins on the policies that matter.

The view put forward last May that they should let the Tories govern but not go into coalition with them was right. They could have set the terms of their support without being tainted, and changed those terms or withdrawn their support much more easily. Clegg's and Danny Alexander's enthusiastic espousal of the deficit reduction programme will blight the Lib Dems for a very long time.

The Alternative Vote (AV) referendum, which is scheduled to take place on 5 May, will play an important part in determining the timing of any Lib Dem divorce from the Tories. If the referendum is won by the Yes campaigners and the next election is to be fought on AV, it would be advantageous for the Lib Dems to delay the general election until after AV is introduced in 2015, under the terms of the Parliamentary Voting System and Constituencies Act. But if the Lib Dems lose the referendum, there will be no reason to delay - the quicker they get out of the coalition, the sooner they will be on the road to recovery with the electorate. If people can't wait to be rid of the coalition, they should vote No to AV. In the event of an early election, following the collapse of the coalition, who would win?

It is difficult to guess the results of an election that may be two or three years away. Who could have predicted the outcome of the 2010 election in 2007, when Labour carried all before it, or in 2008, when the Conservative Party looked unbeatable?

Say no to AV

However, it is possible to identify what the electorate has been looking for recently. What it wanted in 2010 has been ignored. Instead of evolving into a centrist government, the coalition has been conducting its business in two separate compartments: Thatcherite economics, which the country rejected when it endorsed Thatcher's demise in 1992 and elected New Labour in 1997, 2001 and 2005; and the Lib Dems' constitutional reform programme, which seems irrelevant to the UK's problems.

Labour lost the 2010 election because of the behaviour of its leadership over a sustained period of time: there had been too much internal division, spin and bad-values politics. It was this that cost Labour, rather than the position it had taken on the central question of British politics - the management of the economy - a position of prudent economic management coupled with social justice. Prioritising enterprise and fairness: this is the position that the electorate urged on politicians last May. What the coalition demonstrates is that this cannot be delivered by the Tories, either alone or in combination with the Lib Dems.

That leaves only Labour. The polls and recent by-elections suggest that Ed Miliband's election as leader marked a watershed from the TB-GBs, the leadership that forfeited the country's trust. So, Miliband could be prime minister sooner than many people think. And the way to achieve that is to reject his advice on AV.

Charles Falconer was lord chancellor and secretary of state for constitutional affairs between 2003 and 2007

This article first appeared in the 21 March 2011 issue of the New Statesman, The drowned world