Office Politics

Posted On: 
24th January 2013

The Coalition may disagree on Europe, press regulation and energy policy, but Nick Clegg insists it is working well – with the Liberal Democrat imprint clearer than ever

Nick Clegg is moving out. He’s had enough of the toxic stuff of Government and the banging on the ceiling from the neighbours. It’s time to move further away from Number 10.

No, this is not the end of a beautiful relationship between him and David Cameron. The mundane truth is that Deputy Prime Minister’s suite in the Cabinet Office is being cleared of asbestos, the noisy neighbours are the builders and he is relocating to Dover House. This is a short walk up Whitehall, not a long walk out of Government.

He may be changing offices, but the Liberal Democrat leader is still very much In Office – and in power. Having gone from Rose Garden to Ronseal in the past two years, Mr Clegg looks more relaxed and yet more focused on his party’s task in helping the run the country.

As he looks ahead to the coming, crucial year for the Coalition, the DPM sings the praises of his partnership with the PM. Yet he also stresses key areas of difference and how reports of the death of his party have been greatly exaggerated.

“I keep reading these breathless predictions of the imminent demise of the Liberal Democrats, but I think we'll prove ourselves during the course of this year to be in good shape, actually,” he says.

“I think, in Government, the imprint of the Liberal Democrats is becoming ever more obvious to people. Just look at the last few weeks, we had the mid-term review, which included a number of long-held Liberal Democrat aspirations on improving access to affordable housing, dealing with social care, providing help with childcare. And of course [what] we announced last week was literally designed, bit by bit, by Liberal Democrat Steve Webb - this revolutionary change in our pension system – a single-tier pension.”

Mr Clegg goes on to say he and Ed Davey will be launching the Green Deal for households next week, though he’s careful to point out it was “first designed by Chris Huhne” (Huhne gets several notable name-checks). He adds that the personal allowance this April will have a “massive leap” to give about £600 back to every basic rate taxpayer.

“It’s taken a while to have these things get through the kind of engine room of Whitehall, but they really are coming through now.  That will make a big difference as well, because it will clarify to people what we've delivered for them, not just what we've sort of said we will deliver for them.”

As for relations with the Tories, he’s speaking fresh from a PMQs where the two parties are not on the same planet, let alone page, on Europe. “Coalition is more widely understood as being something where the two parties don't have to agree - I've just sat through Prime Minister's Questions where self-evidently I didn't agree with what the Prime Minister was saying on behalf of the Conservative party - and yet we can also do good things for the country as a whole.

“I think for a long time we had this ‘pendulum swing’ tendency, with the Coalition either to be described as some Rose Garden moment where the parties were in each other's pockets, or where the parties were really at each other's throats. In fact, it was always, in a sense, a mixture of unity and difference.”

He goes on: “As I go round the country, people are no longer saying 'Oh, you're either a patsy for the Conservatives or you're like rats in a bag. Actually, so, I get coalition a bit more.'

“Liberal Democrats, you know, we've had chunks bitten out of us and it's been a rollercoaster ride over the last two years. But what doesn't kill you makes you stronger, and I think that's absolutely the case for the Liberal Democrats, and I think that'll become much, much more obvious during the course of this year.”

There’s lots of talk that the Lib Dems could end up again in another Coalition after 2015 if the voters continue to fail to adhere to traditional loyalties. Does he think Coalitions are here to stay?

“You are going to have greater volatility in British politics in the future, people are much more choosy, they're much more critical of politicians, they're much more, almost, consumerist in their choices…At a time of both public scepticism about politics and economic and social anxiety because of the state of the economy, you tend to get, both here and frankly everywhere else in Europe, parties which suddenly bob up in the polls because they're appealing to a sort of ‘none of the above’ sentiment.”

Does he mean UKIP by any chance? “To be fair to Farage, he's totally open about it. He says the reason [for voting UKIP] varies immensely. I can understand it when people say 'oh, I don't like any of this. I don't like any of the present lot. I want something, I want something different outside the, outside the mainstream'”

“That I think is a totally natural, normal and, in some senses, healthy kind of safety valve in a democratic system. But, so, for all those reasons: volatility, mass abstensions, end of class based politics - I just think it's likely that, it's more likely that you're not going to get these great slam-dunk majorities for one party, to the exclusion of others, in the future.”

Barack Obama was inaugurated this week with an emboldened, progressive message on women’s rights, gay rights, the threat of climate change. Was that the kind of address Mr Clegg would like to give? In his answer, he lets slip just how irritated he has been by his Tory partners’ shift away from the environment. Here there is that rarest of things: a whiff of Clegg criticism of David Cameron.

“I'm not going to hide the fact that I found it quite frustrating that all the talk about green politics sometimes has proved harder to actually put into practice - because of a reluctance on behalf of my coalition partners to really do what they said they would do on the green issues. I don't regard green issues as an add-on. I think it's an absolute vital strand in the re-invention of the British economy.

“We have a huge opportunity to, to be a world-beater in offshore wind, in renewable technologies. I think Chris and Ed have done a great, great job, and it's really important that we now invite investors to come in and make the multi-billion pound investments they need to in our new, diverse, renewable energy mix. So on that I'm absolutely delighted that Obama seems to be returning to that theme, having gone slightly quite quiet on it.”

However, despite plans by Tim Yeo, the chairman of the Energy Select Committee, to table an amendment to the Energy Bill that would impose a decarbonisation target, Mr Clegg insists that the Lib Dems “will stick with what we agreed in the Coalition Government.”

So he won’t vote for the Yeo amendment? “No. That’s the nature of coalition” he replies, before launching in to a clear criticism of the way his Conservative colleagues negotiated over the Energy Bill. “I was frustrated. Because of Conservative reluctance to sign up to decarbonisation target we sent quite mixed signals to investors in a way that can jeopardise jobs in the energy sector over a period of time” Mr Clegg argues. “If it was a Liberal Democrat Government it would have moved faster on decarbonisation but once you’ve reached an agreement I think it’s important to respect it.”

Childcare policy is a further issue where the Coalition is trying to hammer out a compromise. The DPM says an announcement will be out “in the next few weeks”. But he also wants to set the record straight: he is not against helping the better off meet their costs.

“What you'll see in the announcements is add an additional layer to those that are above that range of existing or developing support - the squeezed middle, Middle England- who deserve help. And then also targets particular help at a group of people who will receive universal credit in the future but won't receive it on a sufficient scale for them to have an incentive to go into work. So those in a sense are the two groups.”

Are those two groups going to be dealt with differently? “Well that's exactly what we're crunching through now.”

Is the Treasury making life difficult?  “I’m afraid we are in a bit of a zero-sum world in Whitehall, where if you're going to do something good and additional in childcare, which clearly won't be on the scale that it would be if we had pots of gold and money was no object, we have to start somewhere. But you know future parliaments or future governments will be able to expand it as they see fit. The Treasury's perfectly reasonable in saying 'ok fine, but spell out how, where the money comes from' and that just takes a bit of time.”

“I'm unambiguously in favour, and have been arch-proponent of, giving more help to the British middle-classes who don't get help through the benefits system or the tax credits system and won't get help through universal credit, who might in a sense statistically be better off than some on low income but don't feel better off because they're spending 10-15% of their weekly income on childcare. It's an absolute duty to try and help people, the squeezed middle if you like, who aren't at the bottom.

“We're trying to make it as simple as possible, and we crucially want to make sure its consistent with and fills the gaps in the range of measures we've already put in place - 2 year olds, 3 and 4 year olds, universal credit, abolition of the 16 hour rule.

“We certainly want to make the help which goes to people who aren’t on universal credit, who aren’t on benefits - the squeezed middle - as simple and transparent and uniform as possible.”

But on the other area of childcare that many Tories believe will help stay-at-home mums – a married couples tax break - the Deputy Prime Minister is not convinced. Particularly when finances are ‘tight’.

“We will not support a transferrable married tax allowance if that were to come before the House of Commons. Why should the fact you've chosen not to be married mean you're penalised in the tax system? There'll be lots of people in this country when this debate takes place, and when this debate really unfolds, will say 'well actually, put it that way, it doesn't really make much sense.'”

As for the biggest issue of this past week, Europe, the gap between the two parties certainly seems unbridgeable. Mr Clegg last week joked that his language skills would be needed to translate the Prime Minister’s speech from double Dutch to Dutch, and the translation service remains on offer.

“I have to confess, I am still none the wiser about exactly what this great re-negotiation means. The Conservative Party will obviously ride away with headlines about the referendum today, [but] my own view is that it will be a tactical victory today for a strategic mistake tomorrow.”

But Cameron also made clear that if he is Prime Minister in 2015 then a referendum will happen. Could this be a future coalition-forming deal-breaker?

“The parties will need to compare notes and work out what goes in the coalition agreement,” Mr Clegg replies, suggesting that there’s no guarantee of the promised referendum, while leaving the door open for a deal. “It’s for the British people to decide…what the composition of that Government is. The ink is barely dry on a piece of legislation which both Conservatives and Liberal Democrats signed up to, which said there will be a referendum - British people have a belt and braces guarantee of a referendum when there's a further transfer of powers from the UK to the European Union - and that’s a very clear statement of principle about when a referendum will take place.” Mr Cameron, he complains, is attempting to “reinvent the wheel all over again.

As for The Speech, Mr Clegg says: “It was a well-crafted speech and obviously very well delivered. But in terms of the content, look, the Conservative Party will obviously ride away with headlines about the referendum today. My own view is that it will be a tactical victory today for a strategic mistake tomorrow. Because actually the whole approach hinges not so much on the referendum, but on prior to that, reinventing and resettling the terms of Britain's membership in the European Union - but I've no idea how.

“So it's very important, this. Either what David Cameron has in mind is something relatively symbolic, a bit like Harold Wilson. Changing the working time directive, even I agree with that, we put that in the coalition agreement; a change on fisheries, fine. But in that case, what on earth is all the fuss about? Because anyone would agree to that.

“Or it means a complete wholesale rewriting of the whole terms of the membership of Britain of the European Union within 18 months flat, which I think is wholly implausible.

“And I just think, I think if you asked yourself this very simple essay question, 'Is it likely that Liam Fox is going to vote for the result of those negotiations which David Cameron comes back with?' I just think that, that suggests that, that what might look quite simple today might look a lot more complex and divisive in the Conservative party over time. But, you know, that's his choice and his corner to take as party leader.”

On the economy too, there are hints of a different emphasis. With the country still limping rather than leaping its way to recovery, and the prospect of a triple dip recession an ongoing fear, Mr Clegg admits that the Government could do more.

“If I'm going to be sort of self-critical, there was this reduction in capital spending when we came into the Coalition Government. I think we comforted ourselves at the time that it was actually no more than what [former Chancellor] Alistair Darling spelt out anyway, so in a sense everybody was predicting a significant drop off in capital investment. But I think we've all realised that you actually need, in order to foster a recovery, to try and mobilise as much public and private capital into infrastructure as possible.”

If not an endorsement of a Plan B, then this sounds very much like an acceptance than Plan A needs more pluses.

“Wherever we can we've got to mobilise more capital investment,” Mr Clegg accepts. The Autumn Statement saw a significant victory for the Vince Cable argument that capital allowances, for example, should be increased. “The economic evidence is overwhelming. It helps create jobs now - people go onto construction sites. It raises the productive capacity of the economy in the longer run.”

When asked if how the Coalition would respond to a possible triple-dip recession, he is careful not to second guess the figures. But he does have some answers: “What kind of things do I think we need to do where we can? I would single out two things.

“Firstly, we need to try, wherever we can, to put money back in the pockets of people on middle and low incomes, because all the evidence is that it is those people that will tend to spend a bit more money on the high street if they feel they've got a few extra pennies in their pockets. Now, one of the cruellest things to have happened to that group of people in the last two and a half years is this very sharp spike in inflation, when it jumped up to 5.2%. That was not predicted and it was very cruel. It's a harsh, regressive thing to happen, because inflation hits people on modest incomes more, and that’s why I attach such huge significance to the leap in the allowance in April.”

“And secondly, wherever we can we've got to mobilise more capital investment into productive capital because the economic evidence is overwhelming. It helps create jobs now, people go onto construction sites, it raises the productive capacity of the economy in the longer run.”

One area where the Coalition leaders clearly parted was in their responses to the Leveson Inquiry. Where Mr Cameron warned of the dangers of statutory regulation for the press, Mr Clegg declared his full support.

Nearly two months on, the Liberal Democrat leader warns that it would be “a real defeat for the whole political class” if Leveson is mothballed.

“I think we're in a real danger now on Leveson of seeing a combination of backtracking by the press, many of whom in my view still just don’t get it, just don’t get that the terms of trade have changed, and gridlock amongst the politicians”.

It is a combination, he says, that could result in “a real danger of seeing backsliding and gridlock culminate in inaction, and I think that would be an absolute tragedy.”

Nor one which would be easily forgiven.

“The idea that this last of last chance saloons should once again be a penultimate…I just think the victims - the McCanns, the Dowlers and frankly the British people - will just consider both the press and Westminster to be a bit of a standing joke if we don't act.”

First with Leveson, and more recently on the boundary review, lines of communication between Mr Clegg and Ed Miliband have opened, with reports emerging of a thawing in relations between the Lib Dem leader and his Labour counterpart. Nothing to report, insists the DPM. “I'm slightly even surprised that people think it’s a kind of great revelation that politicians of different parties can talk to each other” he argues.

"You've got three people at the top of the three main parties now - David Cameron, Ed Miliband and myself - [who are] roughly the same generation. However much I may disagree with both of them, we're all actually relatively civilised characters.  I always slightly make an exception for Ed Balls, but he'll have to look out for himself really..."

A Labour politician for whom Mr Clegg appears to have a growing admiration is David Miliband. “I've talked to him a couple of times”, he reveals before heaping praise on the former Foreign Secretary.

“The speech he gave… was one of the most important speeches in the House of Commons”, says Mr Clegg of the elder Miliband brother’s contribution in the recent debate on welfare spending. “He was the first senior Labour figure to say 'we accept the Government's overall projected spending figures, right through to 2018.' That's the way I understood it. And then he made the perfectly valid point, he said ‘well I disagree with the choices that have been made about how you make up that number'. I could not agree with him more. Clearly there is a big division there…the David Miliband view of the Labour Party’s approach to economic policy and the Ed Balls [view]. The Ed Balls one appears to be ‘just stick your head in the sand, don't ever accept responsibility, never live up to reality.’”

But Miliband the Elder clearly intrigues the Liberal Democrat leader. “If that’s where the Labour Party is going to go… then what we want to see is what is their plan then? What would they cut? How would they make up the numbers? If that’s where, British politics is going I think we're in for a very fascinating time, because there’s a very serious debate to be had about who does bear the greatest burden.”

He points out that Barack Obama is in the right place on this very topic, on the need to admit “that as you are going through a prolonged phase in society of belt-tightening, the question which dominates politics is who has to tighten their belt the most.”

“That is the question of our times, and it will be the key question in 2015, because 2015 in my view will be the first fully-fledged scarcity election, where no-one will be able to sort of hide behind the sofa and say 'Oh no, please I don't want to make these difficult decisions'.

At least, one bit of legislation on which all the parties genuinely agree is the Succession to the Crown Bill. Earlier this week the Deputy Prime Minister led MPs in a debate on his bill to change the rules of succession for the Royal Family. Confusingly for Mr Clegg, at the same time he’s reading Bring up the Bodies, Hilary Mantel’s Booker Prize winning follow-up to Wolf Hall about Henry VIII’s quest for an heir – and the machinating efforts of Thomas Cromwell to help him.

“I’m about a third of the way through. I think it might even be slightly better, partly because if you’ve read Wolf Hall first you’re slightly used to the character [Cromwell]. He’s so sort of attractive and sinister in equal measure.” He then points out the serendipity of his book choice: “Yesterday in this Royal Succession Bill, [we discussed] Catholics,  the seventeenth century, ‘menace to our country’ - and at night I’m reading this book!”

The Clegg family home happens to be in Putney, not far from where Cromwell grew up before going on to serve as Henry’s extraordinary henchman. As a father of three very active boys, Mr Clegg doesn’t have himself have a problem with a quest for a male heir. And the streets of Putney were recently home to snowtime frolics rather than Tudor bloodlust. The DPM explains how his football mad sons brought their friends back after a recent Arsenal game. “It was very sweet actually. It was snowing so heavily on Sunday, I took them all back for pizza and sausages. And they just went out in the street for this snowball fight on the suburban streets of Putney.”

Thanks to their more businesslike relations, there are unlikely to be any friendly Cam-Clegg snowball fights in Downing Street this week. Yet while their bromance has perhaps chilled, it’s nowhere near in the deep freeze. Their offices may soon be further apart, but for Nick Clegg this Government is still the only place he wants to be.