Wednesday, 19 May 2010

Reflections on the Coalition

It's now 13 days since the electorate gave Britain its first hung parliament since 1974, and 8 days since David Cameron walked into 10 Downing Street heading the first coalition government Britain has had since World War 2. With trends being what they are it is likely that election results are going to become increasingly close and that hung parliaments are going to become increasingly common, perhaps even frequent. The process of coalition formation and then how it governs may well define how future governments are formed in the UK. So when it comes to coalition formation there is one great big precedent. British coalition formation is FAST.

Despite many complaints, Britain went from election to government in 5 days, which is very quick. When Scotland had its first elections in 1999 (the Scottish Parliament is elected under the AMS form of proportional representation) coalition formation took two weeks. The norm in Europe is for a coalition to take a good 2 or 3 weeks at least (though it can be longer) to form. Our coalition formation was very fast for several reasons:

  • There wasn't really a viable alternative to the Conservative and Liberal Democrat option.
  • We are used to quick government transition in Britain. In the United States more than a month goes past before the new President moves into the White House, whereas Europeans are used to coalitions.
  • Precisely because we Brits are not used to waiting to find out what sort of government we were going to get the markets panicked slightly. Had this been Europe the markets would have taken it as normal, but the economic situation demanded a speedy reaction.

Due to the speed at which the coalition agreement was written it is very short. Just twelve pages plan the next 5 years! I think it is a pretty reasonable deal for both parties. The Conservatives get much of what they wanted on the economy, and issues like immigration, but the Lib Dems do secure some key gains. The blocking of the Conservative inheritance tax cut, and a rise in Capital Gains Tax are big victories for the Lib Dems. While many have criticised the Liberal Democrats for being opposed to early cuts and agreeing to £6bn in cuts now, in actual fact the picture is quite positive here. When compared to the £160bn budget deficit that Britain faces six billion is a comparatively small cut indeed, much less than I was expecting to see if the Conservatives had won a majority. The agreement also states that the initial cuts will not be to frontline services. Nonetheless, this is still a larger cut than Lib Dems would like, and it seems that VAT will rise, which will not be popular amongst Lib Dem activists. On the environment and particularly the holy ground of civil liberties and political reform there are big wins. The civil liberties section could almost be copy and pasted from the Lib Dem manifesto, whereas political reform is a compromise, but the Lib Dems have gotten more than they expected.

Yet the agreement is short so much will have to be negotiated and dealt with ad hoc, and most of government comes down to the running of departments. In many ways the Lib Dems have secured their greatest victory here. Many have said that the Lib Dems have been given paltry, meaningless cabinet posts. It is true that none of the biggest cabinet posts (besides Deputy PM) has gone to a Lib Dem, but, highly unusually for a coalition, there is a Liberal Democrat minister in every government department. There also seems to be a balancing act going on. Look at the Home Office headed by Theresa May, who has come under fire for her anti-gay rights voting record, her deputy is Lynne Featherstone, one of the Lib Dems most left-wing MPs. Similarly George Osborne is Chancellor, but his deputy is Lib Dem David Laws, and Vince Cable gets the Business portfolio so whenever Osborne or May attempt anything there are Lib Dems looking over their shoulder. The ability of Lib Dem junior ministers to hold their bosses to account will undoubtedly rely largely on that particular Lib Dem, and it may be trying for the coalition at times (a committee has already been set up to deal with arguing Tories and Lib Dems) and beneath the cuddling up to each other the measure underlines Lib Dem doubts. Given the behaviour of Cameron and Clegg, I also have suspect that this is to be something of a dual monarchy, with both 'co-ruling' rather than the Presidential PM of the recent past.

Some suggest that the Lib Dems will become co-opted as a party of the centre-right by Cameron, and create a new anti-Labour majority. If the referendum on AV passes the coalition will be able to run for re-election (If you are a Conservative candidate in a seat you extol people to vote for you as first preference and Lib Dem as second, for example, boosting the chances of election of one of you. Some have suggested that the coalition will be a disaster for the Lib Dems, and they will be annihilated, having 'betrayed' their progressive vote. I think this is a misreading of the Lib Dem vote. While most prefer Labour to the Tories, there is also a large portion of the Lib Dem voter base who hate Labour and particularly Gordon Brown. I find it very difficult to imagine the Lib Dems gaining votes or seats at the next election, but I do not foresee their collapse. The situation will be, I suspect, not dissimilar to the 1979 election, where the Liberals were punished for propping up the Labour government, and lost a sizeable chunk of their vote and 2 seats. They will probably lose more seats (they have more seats to lose now) but will remain a sizeable force. Of course I am no crystal ball, and this is just educated guessing. If the coalition becomes unpopular enough the Lib Dems may break the coalition, forcing the country to a fresh election. If this is done in the right way and is seen to be for principled and consistent reasons then this may well pay off (witness the collapse of the latest Dutch government, where Dutch Labour withdrew due to objections to the war in Afghanistan. Dutch Labour doubled in polls overnight). The effect on the Conservatives is mixed. The hung parliament has made the Tory Right more outspoken as the Cameron Project they so detest has failed to deliver them unto the promised land of majority government, but Cameron can use the Lib Dems to balance them, and has given himself a powerful political centre to work within between his own right and the wishes of his coalition partner. Cameron will have to use all his political skills to keep both his own party and the Lib Dems happy.

And Labour? Well that is for another time.


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