54 Comments

• Liberal Neil 16th Oct '10 - 3:24pm

  Spot on Hywel.

  The reason we have changed policy is not because the finaces are substantially different from what we expected, nor because our menifesto didn’t add up, but because we are in a coalition and having to compromise.

  It would be much more credible, and easier to accept, if they were honest about the realities of bieng in coalition.

• lisa ansell 16th Oct '10 - 3:41pm

  I never quite understood how people swallowed the ‘it was worse than we thought’ when it was a matter of record that it wasn’t.

  The contempt it shows for voters and activists is mindblowing. Just whip up some tribalism, swear black is white- and all will be fine. Who came up with that?

• Mike(The Labour one) 16th Oct '10 - 3:53pm

  This is just the “we must cut early!” decision all over again. It’s a decision your leadership never agreed with the members about, as was cutting early, and the coalition has given them the perfect cover to do what they want without having to justify it to the membership. The “things were worse than thought” excuse is just lazy, and wasn’t true concerning early cuts either.

  The fact is, your leadership are pretending that there is no choice about doing the things they always wanted to do. Whatever the situation they’d be saying the same. Nick Clegg is your Tony Blair, I thought Simon Hughes or Chris Huhne or Vince Cable might have played the part of Robin Cook, but apparently not.

• Mike(The Labour one) 16th Oct '10 - 3:57pm

  I will say this, though- if you’re a genuine Liberal and not a social democrat or a democratic socialist, stick with your party and try to change it. Don’t do what a lot of Labour’s lefties did over the war, marketisation and civil liberties infringements and leave. It’s not Nick Clegg’s party, it’s yours and don’t let him make you feel otherwise like Tony Blair did with us.

• Henry 16th Oct '10 - 3:59pm

  I agree with the aim of this article, but I am not sure I agree with the content. I am afraid that I do buy the line about us being in different economic circumstances, I just don’t think education should take the hit…

  You haven’t discussed an international situation which has frequently been cited as having an impact on the decisions made.

• Kirsten 16th Oct '10 - 4:13pm

  Being in a coalition doesn’t mean giving up fighting your corner. In fact, fighting your corner is what makes coalitions so powerful as a tool of governance.

  The participating parties have to go 15 rounds before a result is thrashed out. Hence there’s plenty of time for thinking the unthinkable, which is what is required in extreme circumstances such as the ones we’re facing.

  What depresses me more than anything about what we know so far about this CSR is its complete lack of inspiration. There is absolutely nil attempt to turn over a new leaf and try something clever and daring. Let’s face it, the old ways didn’t work so why are we advocating more of the same?

  Our institutions – including banks, shock horror – benefit enormously from being able to recruit from our pool of expensively educated graduates, so tap them for some of the bill. And, while we’re at it, let’s have the Barclays College of Business Studies or the Glaxo Smith Kline faculty of gastro-intestinal medical studies. Give them tax breaks if you must.

  In Scandinavia and several other European countries, university education is free for all EU citizens who care to go there, so what are they doing right and what are we doing wrong?

  To justify this plodding, inelegant way of managing our national economy, they keep telling us that we have to tackle the deficit as we would all run our own little household debt. This is purile to say the least, but let’s run with it for the sake of argument.

  In the case of tuition fees then, let’s start by realising our liquid assets and sell off the Oxbridge dons’ wine cellars. That should fund a few thousand poor students for several years. Next we can flog off parcels of University real estate, ownership of which will entitle us to one or two privileges when we go to Uni – like a room with a view for example. Start charging a proper rent to our lodgers, the staff who live at the Universities etc etc. All things your average household would want to do to reduce their debt. In this country it’s a rare parent who’d suggest asking their five year olds go out to work and start paying for their b&b.

  Now let’s see our leaders put on their thinking caps and provide some inspiration.
  If they’re incapable of doing that we’ll have to do what any employer (in this case, that’s you and me) would do. Sack them.

  I guess what I’m really saying to our leadership is STOP CONSTANTLY PICKING JUST THE LOW HANGING FRUIT AND START DOING SOME REAL WORK FOR A CHANGE!

• Anthony Aloysius St 16th Oct '10 - 4:15pm

  The thing is that the pledge to vote against an increase in tuition fees was effectively broken when the coalition agreement was signed, because that committed the party to, at most, abstaining rather than voting against. And with the current parliamentary arithmetic, that makes all the difference.

  As with the timing of cuts, we end up asking whether the economic situation fundamentally changed within a few days of the polls closing, at exactly the time when the coalition agreement was being negotiated.

  Of course, the answer is that it wasn’t the economic situation that changed at that time, it was the political situation.

• Poppie's mum 16th Oct '10 - 4:23pm

  The wheels are falling off the bus, and the public are waking up to the Lib Dem leadership lies.

  Interesting polling for Sheffield Hallam and Eastleigh voting intentions and their differences from the May 6th result.

  Populus poll shows latest voting intention
  Clegg’s Sheffield Hallam seat Lib Dem 33%(-20), LAB 31%(+15), CON 28%(+4)

  Huhne’s Eastleigh seat Con 42%(+3), Lab 21%(+11), Lib Dem 31%(-16)
  Figures in bracket show increase/decrease from May 6th.

  Clegg’s popularity shows shocking drop. Any Lib Dems care to explain why ?

  The media and the Westminster bubble are completely out of touch with how outraged people feel at what the Lib Dems are doing. It isn’t just going to all come right in 2015 – either for the people of Britain or the Lib Dems.
  The latter, it’ll be their fault, but the people of Britain deserve more.

• Hywel 16th Oct '10 - 4:29pm

  Henry
  “I am afraid that I do buy the line about us being in different economic circumstances,”

  That maybe a reasonable view to take. Just point me at some figures that back up the argument that circumstances were worse in June/July than could have been predicted in August.

  “You haven’t discussed an international situation which has frequently been cited as having an impact on the decisions made.”

  Often cited but again no hard figures have been produced. Certainly the international markets were very jittery in May when faced with an unstable UK political situation and potentially an unstable economy in parts of Europe. My understanding is that this had been calmed somewhat. I can’t see any real reference to this being an issue in the June budget report.

  Labour Mike
  “This is just the “we must cut early!” decision all over again.”

  There are two slightly different arguments.
  One is “things were worse than we expected” – by and large I don’t buy that as set out above.

  The second is “we should delay cuts”. I’m less convinced on that front. I certainly don’t think that a marginal improvement in the situation which seems to be indicated on the figures above is a basis for doing that.

  In general terms it is always better to start paying back debt, (or reducing the rate at which your debt is increasing) earlier rather than later as it will save money in the long run. Our policy on cuts should be something like “As soon as possible, as late as necessary”

  On that point I would be happy to be guided by the Bank of England etc as to the impact of cuts now v cuts later on both the recovery and the dangers of increasing difficulty raising government borrowing (leading to higher interest rates etc).

  Politically it is an easy position for the opposition to take. What they are backing are Manyana cuts – we’ll cut, but not just yet.

• LibCync 16th Oct '10 - 4:35pm

  Maybe the books were in a worse state than that, full of unanticipated unfunded commitments. Example:
  http://libcync.blogspot.com/2010/10/if-you-think-thisfinancial-mess-left-by.html

• Hywel 16th Oct '10 - 4:41pm

  @poppies Mum

  SOurce? The only populus poll I’m aware of polled 1500 people across 25 LD/Con marginals. That’s about 60 per seat so nowhwere near enough to draw valid conclusions

• Nick Thornsby 16th Oct '10 - 4:52pm

  I think you slightly miss the point in this piece.

  The argument is not that the *figures* changed, but that circumstances changed.

  Think back to 2007. There wasn’t some point at which the bad debts of our financial system suddenly increased. There wasn’t a sudden take up of sub-prime mortgages. What precipitated the crisis was that contagion began to spread through the system because people lost confidence.

  The potential for a similar contagion and loss of confidence in Sovereign Debt has existed since countries started to build up enormous budget deficit. But it was when things started to go wrong in Ireland, Greece, Portugal and Spain that this risk suddenly increased massively.

  The situation changed, even though the deficit didn’t. That is why this Govt is aiming to deal with the deficit quickly.

  Another point. I don’t think Vince and Nick were ever happy with our tuition fee policy. They believed it undermined our credibility when one of their key aims was to make us an ecomincally credible party in an election which was fought on economics. I happened to agree. But they weren’t successful. And now we are realising exactly why they wanted to change the policy: because it is simply unrealistic at a time like this.

• Nick Thornsby 16th Oct '10 - 4:56pm

  ‘ecomincally’

  The disadvantage of writing comments on an iPhone.

• lisa ansell 16th Oct '10 - 4:57pm

  ”Maybe the books were in a worse state than that, full of unanticipated unfunded commitments.”

  Yet when challenged to demonstrate these unfunded commitments- little evidence offered. In fact backing down every time an explanation demanded. Just shouts of ‘labour did it’. I thought I was voting for pluralist politics.

• Jonny 16th Oct '10 - 5:24pm

  Labour instigated review; presumably the Tories wouldn’t support abolishing fees; Browne Review comes out which serves as a tax rise on the well-off so that HE isn’t killed by the cuts that it will still have to make. Result.

• Mike(The Labour one) 16th Oct '10 - 5:35pm

  @Hywel: I disagree- the timing is important. Labour would have had a solid year to formulate their cuts, rather than having ministers *race* each other to set cuts out. And the economy would be hopefully be more stable by then. And cutting more gradually would have had its own advantages.

  Stiglitz thinks cutting too early risks a double dip. As do plenty of other respectables.

  ‘Spending cuts must not be forced through too soon, making the recession worse.’ Stigli- no wait, that was pre-election Vince Cable.

  This was too-

  ‘I’d love to attempt a critique of the Tories budget plans but I have no idea what they are. I think the present line on the budget is: trust us and we’ll tell you after the election. Well I’m sorry but that simply isn’t good enough.’

  It’s funny with hindsight.

• Henry 16th Oct '10 - 5:54pm

  (As I say this is all with the caveat that I agree with most of the article, but…)

  @Hywel

  The problem is, the decision over ‘whether or not to lend to country A’ is not something that is down to local ‘figures’ as such – it is about an analysis of risk (eg a UK Government once a large number of other countries in someway similar situations have gone bad may be closer to being viewed as a ‘risk’ than another country not in a similar situation).

  The argument that has been made therefore is one of ‘the international situation pushed us further towards a precipice’.

  I don’t know whether I agree entirely with this or not, but it does suggest that it goes, at least further than the figures you cite. And if no-one lends us money, we won’t be able to slowly reduce the deficit at all, and the cuts will be more severe.

• Hywel 16th Oct '10 - 6:47pm

  “The potential for a similar contagion and loss of confidence in Sovereign Debt has existed since countries started to build up enormous budget deficit.”

  Wasn’t that equally true in March as June though? I suppose there were more grounds for concern immediately post May (see above) but as regards the UK they were more concerned with the political rather than economic situation.

  That was not mentioned as an issue in Osbourne’s budget report in June (at least not in the foreword/summary) and AFAIK gilt auctions since the election have been oversubscribed at a similar rate to that before the election.

  “exactly why they wanted to change the policy: because it is simply unrealistic at a time like this.”
  Why unrealistic. The Coalition government have committed to several “big ticket” spending items (Corporation Tax cut, Changes to NICs, Fairness premium £7bn – totally over £25bn over 5yrs). There was the political will to do those so if there isn’t the will to do something on fees (manifesto costing £6bn over 5yrs) then people should be clear that it is because they choose not to make that priority, not that its undoable.

  @LabourMike
  “‘Spending cuts must not be forced through too soon, making the recession worse.”
  The issue there is “when is too soon” – and there is a balance between lower growth/lower overall debt and higher growth/bigger overall debt. Timing is a nuanced judgement and there is AIUI economists arguing both ways.

  I think we’ll have to disagree on this as there are economists on both sides

• Nick Thornsby 16th Oct '10 - 7:11pm

  @Hywel

  Yes, clearly the potential was there in March, but the changed picture in Europe in May massively increased the risk.

  The problem with the cost of our commitment was that it didn’t take into account the greater cuts that are being made. If universities were to be funded to the same level, more money needs to be found, either through more taxation or greater cuts elsewhere.

  Oh, and I think the £7 bn announced by Clegg is not yearly, but a cumulative amount over four years. It is the total.

• Martin Land 16th Oct '10 - 7:26pm

  I agree with Hywel.

  Now, where have I heard that before….?

• John Ruddy 16th Oct '10 - 7:33pm

  I thought I’d never see a Liberal Democrat admit that things arn’t as bad as they thought. Perhaps now you could actually look a bit further back in the official figures and see that the deficit we have now was entirely caused by the recession? And that as of 2007 government spending as a percentage of GDP was lower than it was in 1997? So we’ll have none of that “Labours fault!” rubbish? No? Oh well.

  Just to re-iterate some of the comments-

  Guilt sales have been oversubscribed every auction this year – so theres never been a problem with our credit. After all, the credit reference agencies are the ones who said that Enron and Lehman Brothers were zero risk organisations.

  Bond yields have been falling since the start of the year as well – apart from a blip around the election when the uncertainty of the political situation made the markets nervous. Regardless of the outcome, we would have had the markets in much the same position as now.

  Although debt interest seems such a large number, its not when compared to GDP. Because the economy as grown in real terms by about 30% since 1997, debt interest as a % of GDP is much lower. In fact its lower now than it was during the majority of the years of the last tory government.

  What gets governments out of debt is not cuts – but growth. If our economy was to grow even slightly faster than forecast over the next 4 years, we could eliminate the deficit with half the cuts.

• Nick Thornsby 16th Oct '10 - 7:38pm

  John, that is factually incorrect. Britain was running a budget deficit well before the recession thanks to Gordon Brown’s spending spree post 2005.

  This was one of the only times in recent history that we’ve entered recession with a budget deficit – and a significant one at that.

• John Ruddy 16th Oct '10 - 7:39pm

  @ Nick Thornsby

  There was no changed picture in Europe in May! Virtually nothing which happens in Europe is of relevance to us, because, in case the Lib Dems have slipped it in without me noticing, we dont have the Euro! We have the Pound. That means we have our own currency. We can print extra money when we want to (Bank of England calls it Quantative Easing, but it amounts to printing money), and we can devalue to boost exports. Greece can do none of these. Ireland cant do them either. Neither Can Spain, or virtually any of the countries in Europe.

  Oh and by the way, in Portugal, and Ireland, and Italy, and Greece and Spain, the majority of the government debt is owed to “foreigners”. Less than 20% of UK Government debt (thats debt, not deficit), is owed to non-UK nationals. Most of it is owed to UK banks and UK Pension funds. So again, a totally different picture. I mean a UK bank or pension fund isnt going to try to bankrupt its own country, because they’ll get hit when the government tries to raise the money elsewhere.

  These things are all facts, and they are facts which Osborne and Alexander seem to want to ignore. Which makes me think that neither of them knows much about Economics or finance. Which is probably worrying. At least Alan Johnson is going to read a book about it, which is more than Osborne and Alexander has done.

• John Ruddy 16th Oct '10 - 7:40pm

  @ Nick Thornsby

  In 1997, Government spending as a % of GDP was 42.5%, in May 2007 (before Northern Rock) it was 36.5%. Go to the Office of National Statistics, its all there in black and white.

• Richard Morris 16th Oct '10 - 7:55pm

  This is a great article and makes an important point – although I hope that arguing over the pros and cons of the ‘facts ‘doesn’t obscure a more important overall point – that every Lib Dem MP signed a pledge to say they wouldn’t raise tuition fees, so they shouldn’t do it – or else shouldn’t sign up to anything when we haven’t got the ‘facts’ right in the first place.

  The other point about the ‘ we didn’t know how bad it was til we saw the books’ argument is that apparently the Tories did know – as it’s their spending plans we seem to be now going along with at every turn; Is Vince really saying that George Osbourne had a better read on the economy (and hence the appropriate level of cuts) back in May than he did? Now that really is a worry.

• Nick Thornsby 16th Oct '10 - 7:59pm

  John,

  You said:

  “Perhaps now you could actually look a bit further back in the official figures and see that the deficit we have now was entirely caused by the recession?”

  The recession began in 2008.

  In 2006 the budget deficit was £34.7 bn. In 2007 it was £37.7 bn. We were spending this much more than the tax take for two years before the recession started (see, e.g. http://www.statistics.gov.uk/pdfdir/maast0310.pdf).

  So your statement was factually incorrect wasn’t it?

  Your comment in reply did not address the issue.

• John Ruddy 16th Oct '10 - 8:10pm

  @ nick Thorsby

  I presume the figures you are quoting are excluding investment? Oh, thats right, they’re not. They’re not part of the “structural deficit” we hear so much about these days (thats the deficit which is to be eliminated).

• Simon Shaw 16th Oct '10 - 8:33pm

  @Nick Thornsby
  I reckon you’re right, Nick, and John Ruddy is wrong.

  One example:

  John Ruddy
  Less than 20% of UK Government debt (thats debt, not deficit), is owed to non-UK nationals.

  Surely the debt, i.e. what is currently owed is not the point. The problem is with the massive extra debt over the next (say) 2 years. Even with the The projected deficit in 2010/11 is around £150,000,000,000 and it is around £120,000,000,000 in 2011/12, so that £270,000,000,000 has to be borrowed from somewhere – much of it from overseas.

  To say theat the Greek debt crisis around the time of the General Election should not have influenced the view of Vince and other senior Lib Dems is naive.

• Hywel 16th Oct '10 - 8:58pm

  “I thought I’d never see a Liberal Democrat admit that things arn’t as bad as they thought.”

  No – I’m just saying I can’t find any figures that they are worse than we thought. Though as that involves spending 25% more than we have coming in thats a bloody good job!

  BTW I have sent Vince and Nick a link to this article and said they are welcome to comment.

• Richard Morris 16th Oct '10 - 9:10pm

  Nick/John – while it’s great fun watching you two fight it out over the difference between the deficit and sovereign debt, the point is we should have known the figures and we’re now saying we didn’t. Which is just embarrassing. And it’s no good saying we couldn’t have known the figures, as by backing the Tories spending plans, we’re implicitly saying they knew more than we did.

• Simon Shaw 16th Oct '10 - 9:14pm

  Poppie’s mum
  Interesting polling ….The media and the Westminster bubble are completely out of touch with how outraged people feel at what the Lib Dems are doing.

  The really interesting polling, which you strangely fail to mention, is in the local council by-elections which have been held week in and week out all over the country, since the General Election.

  Looking at principal council by-elections only (i.e. excluding the many parish council by-elections), there have been 112 such genuine tests of public opinion.

  And how “outraged” were people at the Lib Dems? They were so outraged that the Lib Dems have made net 3 gains over the 5 months to the end of September.

  Fuller details are here, at
  http://birkdalefocus.blogspot.com/2010/10/lib-dem-by-election-results-continue.html

• John Ruddy 16th Oct '10 - 9:19pm

  @ simon Shaw

  Virtually none of the extra debt will have to be borrowed from overseas. The banks are having to raise their capital reserves. They will do this partly from share issues, but mostly from the purchasing of Government bonds. They will probably purchase UK Government bonds, as the UK Government prefers UK banks to hold UK bonds. The value they need to increase their reserves by? £800 billion. I’ll write that out in in long numbers as you seem to prefer them – £800,000,000,000.

  As I said, the Greek situation is totally different to ours. Another thing is that most greek debt is due for repayment in the next 2-5 years. Most of ours has an average repayment date of 2024. Yes, thats right, 14 years in the future. Plus, the Greek “crisis” was actually worse earlier than in May. It was pretty bad around Christmas. Its got worse since May, but thats partly because the markets dont think that the drastic reforms wont work, but thats another story. Plus I seem to remember someone saying that if we went down the road of Greece, cutting spending, without growth, just at the behest of the markets there would be massive social unrest in this country. Cant recall who that was, can you?

  Would you care to tell me why the situation in another country, which cant devalue its currency, which cant change its interest rates, with its debt held by foreign investors, that cant print its own money is so similar to ours? Because I cant. Bear in mind we’ve already had Nick say that it wasnt the Greek crisis which changed his mind, that he changed it much earlier.

  As to who is currently buying UK government bonds, have you any information? Seems to be mainly Uk banks and pension funds to me – and they’re currenty over-subscribed. We will have no problems with our debt., and anyone saying anything different is naive.

  BTW did you know that Government debt was greater than 100% of GDP between 1918 and 1964. World didnt end, society didnt collapse. In fact, we went on just fine.

• Simon Shaw 16th Oct '10 - 9:29pm

  @Hywel
  I reckon part of the answer to the question you pose is what happened with Greece, in particular, in late April 2010. As an example, note the following report published just 8 days before the General Election:

  Guardian 28 April 2010
  Greek debt crisis: Europe feels shockwaves as bailout falters

  With the head of the Organisation for Economic Co-operation and Development, Angel Gurría, comparing the crisis to the ebola virus, the Conservatives and the Liberal Democrats warned of Greek-style problems for Britain unless swift action was taken to repair the public finances….

  George Osborne, the shadow chancellor, said: “If anyone doubts the dangers that face our country if we do not, they should look at what is happening today in Greece and in Portugal.” David Miliband, the foreign secretary, accused the Tories of “economic illiteracy” over the claim, but Vince Cable, the Lib Dem Treasury spokesman, also drew the same comparison.

• John Ruddy 16th Oct '10 - 9:53pm

  @Simon Shaw

  A quote from a guardian article doesnt answer my question. In what way is the Greek situation the same as the UKs when almost every thing about their situation is different to ours. Now, if we were Ireland, then it would be correct to compare our situation to the Greek one. We would be in the Euro, and most of our debt would be held overseas. But we’re not.

• Simon Shaw 16th Oct '10 - 10:25pm

  @John Ruddy

  As my posting was headed “‘@Hywel”, you would have been fair in assuming I wasn’t speaking to you.

• John Ruddy 16th Oct '10 - 10:52pm

  @Simon Shaw
  However, since your last posting was addressed to me, and you didnt answer the question, I assume you must agree that our situation is in no way comparable to that of Greece?

• Nick Thornsby 17th Oct '10 - 12:39am

  @ John Ruddy

  I don’t want to labour the point, but you didn’t answer the question.

  You said in your original comment that the recession caused the entirety of the budget deficit -i.e. that we had a budget surplus until the recession.

  If you want to clarify this, show us the figures that back up that statement.

• Richard SM 17th Oct '10 - 12:47am

  The author of the lead article has done a good job examining the basis for the coalition claim: public sector finances were found to be worse than could have been known in the run-up to the general election.

  The ‘claim’ has been made by various coalition speakers in different forms recently. “Public finances are in an even worse state than we thought.” “We hadn’t seen the books.” etc., etc.

  In fact, anybody with a computer can access government financial information. For a members of the general public, it takes a while to find your way around the financial, economic and statistical data for the first time, but politicians and their researchers are familiar with the system. I did it myself a few years ago. Bit of a pain initially. Monthly reports are usually available by the end of the following month. Of course, MPs receive these reports anyway – and many of them serve on the various scrutiny commitees in Parliament – Treasury Committee, Public Accounts Committee, Defence Committee, Public Administration Committee etc., etc. They have all the reports and can seek clarification on the content if necessary.

  To say, “We haven’t seen the books,” and “It’s worse than we thought,” is utter nonsense! In fact, the monthly reports that came out after the general election showed better-than-expected results and the budget deficit was revised down. See below for a few examples. More importantly, over-reserves or accruals if you prefer, set aside for last year, could be released into this years figures, as in the first example below shows. After setting out his plans to make £6bn of savings over the coming year Geo Osborne then had a windfall bonus of £7.4billion drop onto his lap, .

  “The Office for National Statistics has revised down the amount borrowed by the government last year from £163.4bn to £156bn.” (BBC 21 May 2010)

  “UK budget deficit lower than feared” reported the Guardian, 18 June 2010 when May figures came. That’s another £2 billion dropping onto Osborne’s lap!

• Liberal Neil 17th Oct '10 - 12:51am

  @John Ruddy “Guilt sales” – was that Labour’s cunning plan to pay off the debt?

• Hywel 17th Oct '10 - 1:04pm

  @Poppies Mum
  Have you found a reference for that poll yet?

• Hywel 17th Oct '10 - 1:09pm

  Ah – have found it myself on my usual round up
  http://ukpollingreport.co.uk/blog/archives/2834

  You left out the second half of the polling. I’m sure this was an oversight

• mpg 17th Oct '10 - 6:31pm

  @Hywel

  Great post and great comments. My thoughts, though less eloquently expressed, exactly.

  I fear our friends who ‘hear-no-evil’ simply cannot accept that what Vince and Nick are saying is not strictly the truth. The truth is, they have other priorities that they want to fulfill over tuition fees, and its easier to say ‘its the finances’ than to admit a change in priorities.

• Patrick Smith 17th Oct '10 - 9:09pm

  The key component in the `Coalition Government’ economic policy is to reduce over 4 year plan the inheritance of a `structural deficit’ of circa £156B that has to be repaid at current interest rates at £25 M each day.This figure is still the highest `structural defict’ per capita in the EU and so must be addressed a.s.a.p..

  The issue is how fast should this defict be tackled and will the traditional backbone of L/D support i.e. the vulnerable and the most disadvantaged- be `unfairly’ or needlessly impacted?

  I believe that we have in the collective talent in our L/D Cabinet share of `Coalition Government’ plenty of ability to ensure that the vulnerable will be greatly be seen to be the main beneficiaries, over the fullness of a 5 year Parliamentary term..

  There has not been a whole Liberal Government for 100 years and so we are currently reliant on the Tories but progressive Liberal Leadership will not stem from them but from our front bench team. They all have my confidence, especially our Leader, who I suspect will yet lead our Party to much higher ground by 2015.

  Has anyone read Andrew Rawnsley`s latest book?

• Grammar Police 18th Oct '10 - 8:26am

  The figures don’t add up, because we’re not putting in place a Lib Dem budget, but a coalition one . . .

• Matt 18th Oct '10 - 12:20pm

  @Hywel

  I take it you are referring to the 2nd part of the poll which was

  In Lord Ashcroft’s poll there’s a nod to this – they ask how people would have voted in their constituency where Chris Huhne/Nick Clegg is MP had they known the Lib Dems would form a coalition with the Conservatives, prompting with all the candidate names. Amongst those saying how they’d have voted, the figures in Eastleigh are CON 35%(-4), LDEM 42%(-5), LAB 18%(+8).

  In Sheffield Hallam they are LDEM 43%(-10), LAB 27%(+11), CON 20%(-4

  So isnt that showing that where people to have known we would end up with a Condem Coaliton then the Liberal Democrat vote would have collapsed massively?

  And the poll showing how people would vote today if there was a general election was.

  Populus poll shows latest voting intention
  Clegg’s Sheffield Hallam seat Lib Dem 33%(-20), LAB 31%(+15), CON 28%(+4)

  Huhne’s Eastleigh seat Con 42%(+3), Lab 21%(+11), Lib Dem 31%(-16)
  Figures in bracket show increase/decrease from May 6th

  Again both polls are indicating a complete collapse of support for Liberal Democrats, with most of the gains going to Labour.

  And anyone wanting to use the same old dribble that polls always show that once a party gets into government there polls always drop mid term between 10-15% are deluding themselves.

  It is only Liberal Democrats that are suffering at the polls and have dropped from Highs of 25% to today’s lows of 12%

  Conservatives seem to be pretty much unaffected at the moment, which would suggest that Liberal Democrats are the ones who are being blamed for the spending cuts that have already happened and will be further blamed for the ones that are to be announced on Wednesday.

  Liberal Democrats are at great risk of making themselves the insignificant party again if they are not careful.

  I dare say if things continue on the course they are, and if the coalition was to collapse in 12 months time. The elections will become a 2 horse race again between Labour and Conservatives, and you will probably be able to fit all Liberal Democrat Mp’s in 1 taxi.

  There is clearly only 1 choice for Liberal Democrats, the thing is, do they have the courage to do the thing that is right not only for the country, but also for the party!

• Anthony Binder 19th Oct '10 - 8:28am

  What I really don´t understand is how everyone screams about the so called debt. To have a chancellor that say´s ‘the bayliffs comes knock on the dorr’ just scares me. Does he really think so? In that case he is completely ecnomical incompetent, and if he do understand that no one of the holders of government bonds will request their money back, well then he is only lying in order to implement an ideological agenda.

  There are NO bayliffs gonna come and collect the ‘debt’

  Everyione that has any knowledge know that issuing of government bonds is and should be seen as an integral part of how the government in any country gets their revenues.

  Stop this idiocracy on a fully tax financed national economy, it has never existed, it will never come to be. It is just nothing to do with economics.

  The part of the national budget that is not financed by taxes should not be refered to as a budget deficit, it is plainly the part of the budget that is not financed by taxes. Beside that we need pretty fast start to talk about LVT and other taxes to balance the tax profile.

  Have a clear policy on how much of the revenues that should come through bond issuance is more important than selling out every Lib Dem policy to please the tories.

• Will 21st Oct '10 - 3:37pm

  “public sector finances were in a far worse state than they expected “… so , predictably , that is the feeble excuse for betrayal of the deceived electorate , libdem members , the manifesto , and any future credibility the LibDem party might have hoped to retain.

  Those offering such an excuse have no place in national politics. Actually , they have insufficient credibility to attract a place on a one man red nose day fund raiser.. It is beyond pathetic that they offer the excuse as anything other than the insult to intelligence that it is…
  For God’s sake , we all knew it was as bad as it is. We had it blared at us in the media minute by minute for months.
  Yet , a party leaderrshi seems to have missed the point.

  So what is the real difference that sponsors the sound of the lesser spotted Quisling ringing through Westminster.?

  Simple, a few parliamentary members have decided they now work for the Conservative party rather than the party whose policy, manifesto , promises and pledges they were elected to represent .

  More simply ? Nick and Vince , et al , have a new boss , and it isn’t the party they were elected to serve, it isn’t that party’s membership , activists , or new converts.
  Their new boss is called Cameron. If they don’t follow the part line they will be out of a job, and we don’t need ask whether that matters to them , do we ?

• ad 22nd Oct '10 - 6:19pm

  My starting point is that at some point, both Nick and Vince must have been happy that our policy was sustainable and affordable.

  It could ahve been afforded by cutting something else more, such as the NHS. But Cameron had promised not to cut that.

  A promise is only a promise if it was made by the PM. Otherwise, it is just an aspiration. This is because only the PM can force other people to keep his promises.

• tony 22nd Oct '10 - 8:27pm

  @will
  it was put to me by a Labour party member that of course the Lib dems will be dragged along by clegg etal that he is simply your Tony Blair.

• tony 22nd Oct '10 - 9:47pm

  I kind of remember unemployment falling and growth rising when the new gov came to power also the point re defcit actually being less than forcast (as per the artical)
  I really do think that I am banging my head against the proverbial……
  anyway the polls are allready touching 10% interestingly just below 10% for the bottom 50 centials.

• AJ 22nd Oct '10 - 11:44pm

  I think I’m a bit dim on how these things work but when we did the pledge, wrote the manifesto we must have budgeted for the removal of fees right?

  So now we’re in a coalition we’ve got to share the pot of money with the Tory party so I suspect that were the fee money has gone on some Tory policy, we can’t have things our own way we’ve got to share with the Tories of all people.

  Nor would things have been all cuteness and light with Labour they introduced fees do you really think they would have helped us remove them?

  Sadly for us whatever happens we’re going to come out of it looking like the bad guys.

• Will 24th Oct '10 - 1:43pm

  @ tony…

  not certain the of point you are making…

  But if it is that Clegg and co’ are reminiscent of Blair and co’, and as such as bad…

  I would not disagree..

  I have stated pretty much that point as the reason so many disaffected Labour party voters were seeking a new political home, and looking in the LDP’s direction.
  The huge problem for the LDP is that the Labour party is now well rid of Blair and his unelected heir-apparent , and the party seems to have noticed its followers have had enough of covert tories masquerading as politicians of another colour.
  Nick and his mates haven’t spotted that yet, as they are still wondering what colour to paint their new Ministerial offices.
  Orange or Blue , or rather orangey blue with a blue emphasis.
  Perhaps if they noticed polls returning results indicating an almost sixty percent reduction in suport for the LDP ( from 24% to 10% ??) they might seek to behave in a manner that distances them from comparisons with Blair, rather than behave in a way that compares very closely to Blairs own self-serving approach to the Labour party that blew TheLabour party out of office.
  Blair is despised, as Clegg will be.

• barrie singleton 30th Oct '10 - 7:26pm

  Ambition leads a man into the swamp and promise of power holds him there. Vince has been tryng to ‘be somebody’ for years, and Nick’s demons were there, for the informed observer, on Desert Island Discs. Westminster, and party politics, will never attract integrity.

• Pete Crockett 11th Nov '10 - 8:06am

  I am afraid as someone who has tactically leant his vote to the Liberal Democrats I will never do so again. This was a pledge that gained the Liberal Democrats significant numbers of votes from a large number of students, educationalists and parents. It may even have altered the balance of power in a number of seats. It is a broken promise that many of us will not forget. Indeed, some might conclude they were duped. Political parties that do that invariably pay a heavy electoral price.

  As for Vince Cable, it is devestatingly sad to see him squirm clearly feeling discomfort at what he is saying and doing, there is a quote in the bible “What does it profit a man if he gains the whole world and forfeits his soul?” Vince is the ministerial limo really worth it?