Opposition parties pay bitter price for 2010 mistakes

Labour hobbled itself in Thursday's election by choosing the wrong brother as leader in 2010, while the Liberal Democrats lost their political identity by joining the coalition. Here's my election round-up which will appear in today's edition of The Journal.

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SO we all got it wrong.  All the speculation about hung Parliaments, deals with the Scottish National Party, questions of what would constitute a ‘legitimate’ minority government – in the end, it all proved to be so much hot air.

Labour and the Liberal Democrats are not the only political institutions that will need to take a long, hard look at themselves after the biggest general election upset since 1992.   So will the opinion polling industry.

Its continued insistence that the two main parties were running neck and neck, and that we were duly headed for a hung Parliament, ended up framing the main debate around which the campaign revolved in its latter stages.

Had the polls showed the Tories with a six-point lead, the debate would not have been about whether Ed Miliband would do a deal with Nicola Sturgeon, but about whether the NHS would survive another five years of David Cameron.

There were many reasons why, to my mind, the Conservatives did not deserve to be re-elected, not least the divisive way in which they fought the campaign.

By relying on fear of the Scottish Nationalists to deliver victory in England and thereby setting the two nations against eachother, Mr Cameron has brought the union he professes to love to near-breaking point.

Preventing this now deeply divided country from flying apart is going to require a markedly different and more inclusive style of politics in Mr Cameron’s second term, in which devolution and possibly also electoral reform will be key.

Thankfully the Prime Minister appears to recognise this, although one is perhaps entitled to a certain degree of scepticism over his sudden rediscovery of “One Nation Conservatism” yesterday morning.

But what of the opposition parties?  Well, it is fair to say that both suffered more from mistakes made not during this election campaign but in the aftermath of the last one.

Make no mistake, this was an eminently winnable election for Labour, but it would have been a great deal more winnable had the party chosen the former South Shields MP David Miliband as its leader in 2010 ahead of his younger brother.

That said, Ed fought a much better campaign than many anticipated and stood up well in the face of some disgraceful and frankly juvenile attacks by certain sections of the national media.

What may have swung the undecideds against him in the end was his apparent state of denial about the last Labour government’s spending record, while I shouldn’t think the tombstone helped much either.

Of course - Stockton South aside - Labour continued to perform well in the North East on Thursday, and the party also had a reasonably good night in London.

It was the East and West Midlands that proved particularly allergic to Mr Miliband’s party, and it is here that whoever emerges from the forthcoming leadership contest will need to concentrate their energies with 2020 in mind.

Mr Miliband has facilitated that contest by swiftly falling on his sword, and with deputy leader Harriet Harman also set to stand down, the party will now be able to choose a new team to take it forward.

After such a shattering defeat there will doubtless be calls for a completely fresh start, and new names such as Liz Kendall, Dan Jarvis and Stella Creasy will come into the frame alongside some of the more usual suspects.

As for the Liberal Democrats, well, the Tories’ cannibalisation of their erstwhile coalition partners seems to prove once and for all that Nick Clegg made a catastrophic misjudgement in taking them into government in 2010 – as some of us warned him at the time.

He has also been rightly punished by the electorate for what many saw as an appalling breach of trust over university tuition fees.

The upshot is that a party which achieved a fifth of the national vote under Paddy Ashdown and Charles Kennedy has not just lost nearly all its MPs, more seriously it has lost its identity.

The laws of political dynamics will ensure Labour eventually bounces back from this defeat, just as it did in 1964 and 1997.  For the Lib Dems, though, the future is much more uncertain.

Five reasons why I'm backing a Lab/Lib coalition

Yesterday I outlined why I don't think the current Tory-Lib Dem coalition deserves to be re-elected.  Here's why I hope a Lab-Lib coalition will emerge in its place.

1.  Labour has fought the most positive campaign. Call me old-fashioned if you like, but I still believe that politics should be about sharing a vision of a better world rather than promising to protect us from nightmares - the politics of hope versus the politics of fear. While the Tories have relied on negative campaigning and the tired old tactic of better-the-devil-you-know, Labour has set out a positive case for change, outlining how they would change this country for the better. Even if you don't agree with all the details, this is the right way to do politics and it deserves to succeed.

2.  Ed Miliband has exceeded expectations and has demonstrated that he is ready to be Prime Minister. Despite being subjected to the most disgraceful and frankly juvenile abuse from certain elements of the national press, the Labour leader has held up well under pressure.  As someone said on Twitter today: "I’m sure Cameron eats a bacon sandwich really well. But he’s overseen a million people visiting food banks. I know which matters more."  Ed M may never have that easy rapport with the public that Tony Blair had in his pomp, but in a contest with Cameron he wins hands down, simply because he is more in touch with the lives of ordinary voters.

3.  Labour is the only major party committed to repealing the 2012 Health and Social Care Act. I've heard it argued by health service professionals that the horse has already bolted on this, and that the unleashing of private sector forces into the NHS cannot now be undone.  Well, maybe, but it can be contained.  The Health and Social Care Act - that massive, top-down reorganisation the Tories promised us would never happpen - was a deceitful piece of legislation that set out a route-map towards a system of privatised health care that few people actually want.  It needs to go so we can rebuild our NHS according to the principles on which it was founded.

4.  Contrary to the received wisdom, Labour's policies are actually more business-friendly than those of the Tories. People who do not realise this are faling to see the elephant in the room, namely David Cameron's commitment to an in-out referendum on European Union membership in 2017.  The uncertainty created by this will wreck the so-called 'recovery' and prolong the economic pain for those households, businesses and regions who have yet to see its benefits.  On the question of the deficit, there is very little to choose between the two big parties and, since 2010, Labour has moved significantly in the direction of greater fiscal responsibility.

5.  In coalition with the Liberal Democrats, Ed Miliband would lead a social democratic rather than a socialist government.  Nick Clegg has been absolutely right in this campaign to position the Lib Dems as a moderating influence on left and right, maintaining his equidistance between the two big parties and appealing to the centre ground which is where British politics should continue to be anchored.  Many see Clegg as a Tory collaborator but to be fair, he has made it clear he will talk first to whichever party has the most seats.  For the other reasons set out above, I hope - and pray - that this will be Labour.

Could 2015 be a year of two elections - and three PMs?

My preview of the political year 2015, first published in yesterday's Journal.
 

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It is Thursday, December 31, 2015. The newly-elected Prime Minister sinks contentedly into an armchair at 10 Downing Street, pours himself a drink, and reflects on a tumultuous year in British politics.

Not since 1974 had there been two general elections in a single year. Not since 1852 had there been three Prime Ministers in one year.

Suddenly there is a knock on the door. “The Deputy Prime Minister is here to see you, Mr Johnson,” says the PM’s chief of staff.

“Ask her to wait in the drawing room,” the Prime Minister replies. “I’ll be along in just a moment.”

The Prime Minister had not, of course, expected to end the year in this exalted position. David Cameron and Ed Miliband had led their respective parties into the May general election and he himself had not even been on his own party’s front bench.

But the public had demonstrated its distinct lack of enthusiasm for both Mr Cameron and Mr Miliband by delivering a second successive hung Parliament. The Conservatives were, once again, the biggest single party.

But the parliamentary arithmetic was far more complex than the 2010 contest which had resulted in the Conservative-Liberal Democrat Coalition.

While the Lib Dems’ representation dropped from 57 to 29, with Nick Clegg’s Sheffield Hallam seat among the casualties, the Scottish Nationalists had won 22 MPs and Nigel Farage’s UK Independence Party ten.

The result was stalemate. The SNP’s new leader at Westminster, Alex Salmond, was as good as his word and refused to make any accommodation with the Conservatives.

Meanwhile the Tory and Lib Dem parliamentary parties refused to make any accommodation with each other, such was their mutual loathing by this stage after five tense years of coalition.

Mr Farage’s ten seats, together with those of the Ulster Unionist parties, were enough to cobble together a bare parliamentary majority – but there were two conditions on which the Ukip leader absolutely refused to budge.

The first was that the referendum on British membership of the EU was to be brought forward to 2016. The second was the immediate resignation of David Cameron as Tory leader.

So it was that, after several days of high politics and low skulduggery, Theresa May was installed as Britain’s second female Prime Minister, in what was in part an attempt to forestall the inevitable leadership challenge by Boris Johnson, newly returned to the Commons.

But the government’s position was so precarious that everyone knew there would soon have to be a second election – with Labour also set to go into the contest under a new leader after Mr Miliband fell on his sword.

A summer of political turbulence followed, with Mrs May disappointing those admirers who had once seen her as Britain’s answer to Angela Merkel by appearing to be at the mercy of both Mr Farage and Mr Johnson.

The Tories seemed bent on self-destruction as party activists, angered at the apparent “coronation” of the new premier, demanded she submit to a leadership contest with the London Mayor.

By the time the election came, in the first week of November, it was clear that the public was fed up with multi-party government.

Mr Farage’s machinations over the summer months had brought accusations that the Ukip tail was well and truly wagging the Tory dog and the public mood appeared to have turned somewhat against the Ukip leader.

His cause was not helped by warnings from several major employers, including Nissan, that they would quit the UK if the 2016 referendum on EU membership resulted in a no-vote.

The election duly delivered the clear verdict which the previous two had failed to do, giving the new government a slim but comfortable working majority of 23.

All of which brings us back to 10 Downing Street and the arrival of the new Prime Minister’s deputy for a New Year’s Eve pow-wow with her boss.

“So, any regrets?” said Stella Creasy, herself newly-elected to the role occupied for the previous eight years by Harriet Harman, and now seen very much as Labour’s rising star.

“Well,” replied Alan Johnson, “I never wanted the job, of course, but when 150 of your MPs simultaneously post messages on Twitter saying you’re the only person who can save the party from another election defeat, what on earth can you do?”

“The best man won in the end, Prime Minister,” said his deputy reassuringly, and wished him a very Happy New Year.

Why Nick Clegg has reasons to be cheerful

My end-of-conference season round-up is now online at The Journal website.  I argue that the fragmentation of British politics into a four-party system, coupled with the two main parties' retreat into their ideological comfort zones, presents an unexpected opportunity for Nick Clegg's Liberal Democrats.

http://www.thejournal.co.uk/opinion/paul-linford-nick-clegg-reason-7917355

Barnett Formula pledge is undeliverable and wrong

I was dismayed to read that the party leaders - and Gordon Brown - have pledged to continue the Barnett Formula as part of their three-point 'guarantee' to Scottish voters ahead of Thursday's referendum.

The formula, which gaurantees Scotland a higher level of public spending per head than anywhere else on the British mainland, has been out of sync for many years and, as the former Welsh Secretary John Redwood points out, is particularly unfair to Wales and the Northern English regions which have similar levels of need.

It won't alter my support for the Better Together campaign, but the future funding arrangements for the different parts of the UK need to be based on a new assessment of relative need, not a short-term political fix.

My suspicion is that the pledge will actually be undeliverable.  I can't imagine for a moment that
English MPs will stand for it in the long run, even if they are keeping their mouths firmly shut at the moment for fear of playing into the hands of the Yes campaign.

The politician who should be most ashamed of himself for allowing this absurd pledge to form part of the last-ditch appeal to wavering Scottish voters is Nick Clegg, whose party has previously called for the replacement of Barnett with a needs-based formula.   Given Clegg's track record of U-turning on previous agreed party policy, however, perhaps we shouldn't be too surprised by this.

In any case, the new powers envisaged for the Scottish Parliament, including the ability to raise their own taxes, ought to enable Scotland to move closer towards financial self-sufficiency rather than continuing to rely on block grants from Westminster.  In this sense, maintaining the Barnett Formula in perpetuity would fly in the face of the moves towards federalism that Gordon and others are now belatedly advocating.

3pm Update:  It seems they are not keeping their mouths shut after all.   I very much fear that the pro-Union campaign is going to fall apart over the next 24 hours as a result of this stupid and unnecessary attempt to bribe the Scots.

Why the Coalition won't last the course

IF a week is a long time in politics, then two weeks is twice as long – and the fortnight since this column last appeared seems to have been a particularly lengthy one for Prime Minister David Cameron.

A collective madness has descended upon his party, with rows about Europe and gay marriage punctuated by Cabinet ministers positioning themselves for what many now see as the inevitable post-Cameron succession battle.

Much of this is what Alastair Campbell used to call ‘froth.’ Whatever Michael Gove and Philip Hammond might dream about in bed at night, Mr Cameron is not going to be overthrown as Tory leader before the next election, and if he wins it, this bout of internal rancour will be long forgotten.

And if he loses, or fails again to win an outright majority, he’ll be overthrown anyway – but that’s par for the course for Tory leaders who fail to win elections and nothing that has happened over the past two weeks has altered that underlying reality.

What it may have done, however, is made it rather less likely that he will win in 2015.

Mr Cameron’s once-stated intention to stop his party “banging on about Europe” now seems laughable, while his attempts to detoxify the Tory brand by embracing liberal causes such as same-sex marriage seem only to have alienated his core supporters.

As I wrote in the context of the local election results, the only silver lining for the Prime Minister is that the country still seems less than overwhelmed by the idea of Ed Miliband as his successor.

So long as that remains the case, Mr Cameron may well be able to squeeze the UKIP vote by presenting the 2015 contest as a presidential battle between himself and a man who few voters of a right-wing disposition want to see in 10 Downing Street.

But for me, the most interesting political story of the past fortnight concerned not the fate of Mr Cameron, but the future of the Coalition government which he leads.

It appeared on the front page of The Times a week ago yesterday, and revealed that the Tories are now planning how they would govern without the Liberal Democrats for the last six to ten months of the Parliament.

“We need to have an idea of what we are going to do if at different points it does break up,” a source said.

The paper also quoted a senior Lib Dem as saying that Deputy Prime Minister Nick Clegg needed to act to prevent them “drifting into a four party situation with us as the fourth party.”

For me, this is a story which has been crying out to be written ever since the Coalition was first formed.

As regular readers of this column will know, I have argued from the outset that the political dynamics are such that it will be impossible for the Coalition to survive a full five-year parliamentary term.

It has long been clear that, in order to avoid humiliation in 2015, the Lib Dems will need to start differentiating themselves from the Conservatives long before polling day.

However it is now becoming increasingly clear that if they are to win back some of their lost core supporters from the arms of UKIP, the Tories will also need to start differentiating themselves from the Liberal Democrats.

Here, for what it’s worth, is how I see it panning out. Next June’s European elections turn into a disaster for both governing parties, with Labour and UKIP forcing them into third and fourth place in the popular vote.

Both Mr Cameron and Mr Clegg will then have to face their party conferences in September 2014 with activists demanding how they are going to recover in time for an election that will then be less than eight months away.

If they try to stay together for the sake of the kids, it will almost certainly put Ed Miliband in Number Ten, in that the Lib Dems will find it impossible to woo back their disenchanted supporters from Labour while the Tories will struggle to win back theirs from UKIP.

The alternative – an amicable divorce with Mr Cameron leading a minority government for the final few months of the parliament - really is the only conceivable outcome.

Taxi for Balls? My political predictions for 2013

Andy Murray will win Wimbledon, Roberto Mancini will be sacked as manager of Manchester City, David and Victoria Beckham will return to the UK, and the X-Factor will finally be canned after ten not always glorious years.

Those were just some of the predictions for 2013 made by members of the public in a recent poll on what we expect to see happening in the year ahead.

But so much for the sport and showbiz; what of the politics?  Well, in last week’s column looking back at 2012 I suggested that the next 12 months may well see the Con-Lib Coalition that has governed the country since May 2010 finally splitting asunder.

It seems I am not alone in this view:  the prospect of Messrs Cameron and Clegg going their separate ways was also mentioned in the aforesaid poll, along with a rise in interest rates, a strike by NHS workers and the prosecution of a major bank for fraud.

So what’s causing the present bout of Coalition-busting speculation?  Well, anyone who heard Nick Clegg’s speech at the Royal Commonwealth Society shortly before Christmas will not be surprised that talk of divorce is in the air.

The speech was less about Lib Dem achievements in government as about what Mr Clegg’s party had prevented the Tories from doing.

It was all a far cry from the government’s early days when the Lib Dem leader had been determined that his party should jointly ‘own’ all of the Coalition’s policies - not just those which it had specifically advocated.

But that strategy was only destined to work so long as the Coalition was popular.   Once it started to be unpopular – as has happened in 2012 – it was inevitable that Mr Clegg would begin to embark on a strategy of differentiation.

It has been my view from the outset that the Lib Dems would somehow have to find a way of getting out of the Coalition alive in order to stand any chance of maintaining a significant parliamentary presence at the next election, and I expect this process to be accelerated in the coming year.

The internal politics of the two parties will play a big part.   If Mr Clegg does not, by the time of his party’s annual conference, set out some kind of exit strategy, he will almost certainly face a leadership challenge before the election.

At the same time, those Tory backbench voices which loathe the Lib Dems and all their works will grow louder, as they seek to press David Cameron into the more orthodox Conservative position that they believe – mistakenly in my view – will secure them an outright majority next time round.

I would expect the upshot to be that the Lib Dems will leave the government within the next 12-15 months, with the Tories moving to a “confidence and supply” arrangement for the remainder of the five-year Parliament.

But while the Coalition may struggle to maintain the semblance of unity, Labour leader Ed Miliband will also struggle to present himself as the Prime Minister-in-waiting that Mr Cameron and Tony Blair so obviously were in their opposition days.

Mr Miliband has had his successes, but the full rashness of Labour’s decision to choose him over his brother David will become clear over the next 12 months.

Overtures will be made to the South Shields MP to return the frontline as Shadow Chancellor in place of Ed Balls, whose closeness to Gordon Brown and the errors of the New Labour years will ultimately prove a fatal barrier to the party’s attempts to regain economic credibility.

But a likelier outcome is a comeback for the respected former Chancellor, Alistair Darling, who has successfully managed to distance himself from Mr Brown’s mistakes.

Mr Balls may not be the only major economic player to be shown the door in 2013.  If the economy continues to stagnate, Mr Cameron may also be forced to find a new role for George Osborne as the election draws nearer.

And with Mr Osborne out of the Tory succession picture, attempts will be made to build up Education Secretary Michael Gove as the alternative contender from within the Cabinet to counter the continuing threat of Boris Johnson.

Unlike poor old Mr Mancini, I don’t expect we will see any of the three main party leaders actually losing their jobs in 2013.

What we will see, though, is each of them having to take fairly drastic action in order to save them.

Budget debacle that left Coalition floundering

Here's my annual political review of the year, published in this morning's Newcastle Journal.

Until the early months of this year, the Con-Lib coalition that has governed Britain since May 2010 had by and large done so with a fair wind behind it from the public.

Without ever reaching the heights of popularity enjoyed by New Labour as its zenith, David Cameron’s government appeared, at the very least, to have earned the benefit of the doubt, particularly when it came to the economy.

All that changed on Wednesday 21 March – the day Chancellor George Osborne delivered his third Budget.

To say it was the pivotal moment of the political year would be something of an understatement. In terms of its impact on public opinion, it may well prove to be the pivotal moment of the entire five-year Parliament.

In the space of a 59-minute speech, the Chancellor announced a package of measures which seemed almost deliberately designed to alienate as many sections of the electorate as he could find.

He slapped VAT on hot food and caravans, froze the age-related tax allowance for pensioners, removed a tax break on charitable giving that would have hit hundreds of good causes, and topped it off with a cut in the higher rate of tax worth £42,295 to anyone earning £1m a year.

It was the ‘pasty tax’ rather than the top rate cut which proved the most politically toxic, playing as it did into the ‘Tory toffs’ narrative which had increasingly started to dog Messrs Cameron and Osborne.

In the end, the plan was ditched following a campaign by this newspaper among others – one of a series of budget U-turns which left the Chancellor’s credibility seriously damaged.

From there on in, even though the festivities around the Queen’s Diamond Jubilee and the London 2012 Olympics provided useful temporary distractions, the government struggled to get back on the front foot.

And the slide in its opinion poll ratings was accompanied by increasing tensions within the Coalition itself – notably over Europe, welfare cuts, gay marriage and, most of all, Lords reform.

With his dream of a new electoral system shattered in the May 2011 referendum, deputy Prime Minister Nick Clegg was pinning his hopes of achieving lasting political reform on securing an elected second chamber - but the Tory backbenchers were having none of it.

The Lib Dems retaliated by scuppering the Tories’ plans for a review of Parliamentary boundaries that would probably have gained them 20-30 seats at the next election

Frustrated in his attempts to regain the political initiative, Mr Cameron resorted to the time-honoured tactic of a reshuffle, but some of his new appointments soon began to unravel.

He shunted Justine Greening out of the job of transport secretary on account of her opposition to a third runway at Heathrow only to see London Mayor and would-be leadership rival Boris Johnson rally to her cause.

His appointment of Andrew Mitchell as chief whip also swiftly backfired when he was involved in an altercation with police officers at the entrance to 10 Downing Street.

However in what has surely been the most interminable and convoluted political story of the year, Mr Mitchell now looks likely to have the last laugh, after it emerged that a police officer may have fabricated evidence.

In the North-East, the regional political agenda continued to be dominated by the fallout from the government’s spending cuts.

Newcastle city council responded to the spending squeeze by taking the axe to the arts budget – reminding those of us with long memories of the antics of so-called ‘loony left’ councils in the 1980s.

Yet at the same time, the year saw something of a rebirth of regional policy, driven by Lord Heseltine’s ‘No Stone Unturned’ report which was explicitly endorsed by Mr Osborne in his autumn statement.

The mini budget also saw the Chancellor forced to back down on plans to introduce regional pay rates following a fierce campaign by the unions.

The year ended with increasing speculation that the Coalition may not, after all, go the distance to the planned next election date of May 2015.

With the government seemingly stuck in a trough of unpopularity, the need for the Liberal Democrats to assert their separate identity from the Tories is growing.

Mr Clegg’s decision to make a separate Commons statement from the front bench on last month’s Leveson report into press regulation was unprecedented, but may well prove to be the start of a trend.

If 2012 was the year the Coalition lost the public’s goodwill, 2013 may prove to be the one that sees it splitting asunder.

Clegg's apology will not ultimately save his leadership

Broken promises are nothing new in politics.  From the Labour Party’s 110-year-old pledge to introduce an elected House of Lords to George H.W. Bush’s infamous one-liner ‘Read my lips, No new taxes,’ history is full of instances of parties and politicians failing to keep their word.

But there seems to be something about the subject of university tuition fees which brings out the worst in politicians where keeping promises is concerned.

Back in 2001, New Labour went into the general election with the cast-iron manifesto pledge:  “We will not introduce top-up fees and have legislated to prevent them.”

Less than two years later Tony Blair’s government duly introduced them, in the teeth of a backbench parliamentary revolt in which several leading North-East Labour MPs were to the fore.

If Liberal Democrat leader Nick Clegg had been more of a student of history, perhaps he would have reflected on this before issuing his similarly unequivocal pledge not to raise tuition fees in the run-up to the 2010 election.

Then again, had he done so he might have concluded that breaking promises is not necessarily politically fatal.   After all, Mr Blair’s original broken pledge on tuition fees did not prevent him winning a third general election in 2005.

By the same token, keeping your election promises is no guarantee of political success.

Indeed, it was Margaret Thatcher’s determination to stick to a promise to reform the system of domestic rates that led to the disastrous implementation of the poll tax in 1988 and indirectly to her fall from power two years later.

But for the Liberal Democrats, there was something about breaking the tuition fee pledge that seemed to strike at the heart of what the party is and what it stands for.

Partly because of its strong activist base in the education sector, and perhaps also because of its level of support among students, the question of tuition fees had become something of a touchstone issue for the party.

It was certainly one of the biggest reasons why, in the North East, the Liberal Democrats had become credible challengers in seats with large concentrations of students such as Newcastle Central and Durham City.

So in this sense, for the party leadership to change its mind over the issue was always likely to be viewed as a betrayal on a par with a Labour leader calling for the privatisation of the NHS or a Tory leader announcing we should join the euro.

But this is not all.    There was also something about the idea of breaking election promises at all that ran counter to the Lib Dems’ self-image as a party.

This is why the broken promise on tuition fees was such a watershed for the party – the moment it gave up – possibly for all time – any claim to be representative of a “new” or different kind of politics.

It is for all those reasons that Mr Clegg issued his videoed apology to party supporters this week ahead of what is certain to be a difficult party conference for him.

Whether it will do him any good however remains very much to be seen.  Many of the party’s supporters are likely to take a fairly dim view of the fact that he appeared to be apologising not for breaking the ‘solemn’ promise, but for having made it in the first place.

Mr Clegg finds himself in a strange kind of political limbo.  Despite the comments by Lib Dem peer Lord Oakeshott last month that any business that had lost so much market share would now be under new management, the coming conference week will not see any overt challenge to his leadership.

Yet at the same time, it is hard to find many Liberal Democrats who seriously believe Mr Clegg will actually lead them into the next general election in 2015.

The remorseless logic of their plight is that if they are to present themselves to the electorate as a viable alternative to the Tories as well as to Labour, it will have to be without the man who took them into a Tory-led coalition.

But that is next year’s Lib Dem conference story.  For now, Mr Clegg continues to inhabit the ranks of the political living dead.

Was reshuffle the beginning of the end for Cameron?

Much has changed for David Cameron over the course of his seven years in charge of the Conservative Party – but there are two aspects of his leadership that have remained pretty much constant throughout that period.

The first is that he has tried to avoid reshuffles as far as possible. The second is that in his efforts to detoxify the Tory brand he has, by and large, continued to lead the party from the political centre.

Well, it had to end sometime I guess. Two and a half years after taking up residence in Downing Street, he finally summoned the nerve to move some of his more middle-ranking Cabinet members around the political chessboard.

And in so doing, he tilted the balance of power within his government decisively rightwards – and away from that fabled centre ground he has spent so long trying to cultivate.

On the face of it, this looks like pretty poor judgement on the Prime Minister’s part. To win an outright majority at the next election, his party will have to win approximately 2m more votes than it won in May 2010.

Yet history shows that every time the Conservative Party has lurched to the right in recent years – most notably under William Hague in 1999 and Iain Duncan Smith in 2003 - its support has gone down, not up.

Mr Cameron's entire political success, such as it is, has been built on persuading people that he is not like those Tory leaders of old and that his style of politics, like Tony Blair's, is about reaching out to those who are not his natural supporters.

On no issue is the change in Mr Cameron clearer than that of the environment. The man who once rode a bicycle to work to show his party’s new-found commitment to the green cause has now appointed a virtual climate change denier as environment secretary.

Sure, the changes announced on Tuesday may well bring about some superficial advances in terms of both service delivery and presentation.

On the latter score in particular, new health secretary Jeremy Hunt will surely be an improvement on the hapless Andrew Lansley who, in the words of one commentator, “could not sell gin to an alcoholic.”

But these are trifling gains when set against the central strategic error of failing to recognise that parties struggling to hold onto their support rarely solve their problems by retreating into their ideological comfort zone.

Indeed, it is tempting to believe the entire exercise was less a considered piece of political strategizing than an act of petulance designed to put the Liberal Democrats in their place following the spat over Lords reform and the boundary review.

With the forces of the Tory right now ranged even more formidably against him, there is no doubt that Lib Dem leader Nick Clegg will now find it even more difficult to persuade voters that he and his party are actually making a difference in government.

Meanwhile Labour leader Ed Miliband continues to make mischief by teasingly holding out the prospect of a post-Clegg, post-election Lib-Lab deal with ‘continuity SDP’ leader Vince Cable in the deputy PM role.

But inept as it may have been to drive his Coalition partners further into the hands of the enemy, even more ham-fisted was the Prime Minister’s treatment of his erstwhile transport secretary, Justine Greening.

Mr Cameron’s decision to remove her, apparently for having reaffirmed the government’s policy to rule out a third runway at Heathrow, has handed his real enemy – Boris Johnson – both a key weapon and a key ally in his campaign to replace the Tory leader.

The long-simmering battle between the two men has now moreorless descended into open warfare, with the London Mayor angrily denouncing Ms Greening’s demotion and demanding a statement ruling out a third runway for good.

Ms Greening – a former Treasury minister, take note – must now be odds-on to become Boris’s first Chancellor if he ever makes it into Number Ten – a double case of Blond(e) Ambition.

Hence a reshuffle that was supposed to relaunch Mr Cameron’s premiership has simultaneously risked alienating floating voters, angered his Coalition partners, and handed his main internal rival a big stick with which to beat him over the head.

From that perspective, it is tempting to see it as not so much a new dawn for his government, but the beginning of the end.

A tale of three Prime Ministers

Shortly after Rupert Murdoch sacked him as editor of The Times in 1982, the great newspaperman Harold Evans wrote a book about his experiences which he both hoped and believed would devastate the Australian media mogul.

‘Good Times, Bad Times’ remains a classic of its kind and is still pretty much essential reading for anyone wanting to enter our profession, but if the truth be told, its political impact was far more limited than its author had envisaged.

Over the ensuing decades, Murdoch’s continuing accretion of power over the UK media became by and large a subject of interest only to a few left-wing mavericks, with governments of both colours content to indulge the News International chief in the hope of winning his papers’ backing.

Then came the phone hacking affair, propelling the ‘Murdoch question’ to the centre of national debate to the point where it now threatens to eviscerate the entire UK political and media establishment.

This week’s hearings of the Leveson Inquiry into press standards might be termed a tale of three Prime Ministers, each one giving a subtly differing account of his dealings with the Murdoch empire.

Of the three, Sir John Major - who once promised to create a nation at ease with itself - was the only one who looked remotely close to being at ease with himself.

Actually his most intriguing revelation was not about Mr Murdoch at all but the man who defeated him in that 1997 election landslide.

Sir John’s estimation that Tony Blair was “in many ways to the right” of him seems to confirm my long-held suspicion that Tory governments seeking to reach out to the centre-left end up being more progressive than Labour ones which seek to appease the right.

Unlike Sir John, who admitted he cared too much about what the papers wrote about him, Gordon Brown claimed he barely even looked at them during his two and a half years in 10 Downing Street.

This was one of many scarcely believable claims which, taken together, served to undermine the credibility of what otherwise might have constituted a powerful body of evidence.

Mr Brown effectively accused Mr Murdoch of having lied to the inquiry about a 2009 conversation in which the former PM was alleged to have threatened to “declare war” on News International.

Cabinet office records appear to bear out Mr Brown’s version of events, but claiming he had nothing to do with the plot to force Mr Blair out of office might lead some to conclude he is a less than reliable witness.

The contributions from Messrs Major and Brown contained much that will be of interest to future historians, and may yet have a significant bearing on Lord Justice Leveson’s eventual recommendations.

But in terms of the impact on present-day politics, the key session of the week came on Thursday as David Cameron took the stand.

For such a renowned PR man he seemed very ill at ease, perhaps unsurprisingly given the excruciating contents of the text messages which he exchanged with News International boss Rebekah Brooks.

To his credit, though, Mr Cameron did not attempt to shy away from the responsibility for some of his more controversial actions, admitting that he was “haunted” by the decision to make former News of the World editor Andy Coulson his communications chief.

For me, the party leader who emerged with the least credit from the week was not Mr Cameron but Nick Clegg, whose decision to abstain in the vote over Culture Secretary Jeremy Hunt’s future looked like the worst kind of gesture politics.

If they really wanted to see an independent investigation carried out into Mr Hunt’s role in handling the BSKyB bid, they would have voted with Labour, but this was no more than a cynical exercise in political positioning.

In Journal political editor Will Green’s excellent analysis of the state of the Liberal Democrats in the North-East published earlier this week, Gateshead Lib Dem councillor Ron Beadle was quoted as saying that Mr Clegg would not lead his party into the next election.

Party loyalists aside, it is becoming harder and harder to find anyone prepared to dispute that assertion.

Clegg fires welcome warning shot over regional pay

When the history of David Cameron’s government comes to be written, the Budget delivered by Chancellor George Osborne on 21 March may well be seen as a decisive turning point in its fortunes

Whether it was the pasty tax, the granny tax, the tax on charitable giving or the abolition of the 50p rate, those looking for something to criticise in the Chancellor’s package found plenty of things to choose from.

But of all the measures announced by Mr Osborne two months ago, surely the most pernicious as far as the North-East is concerned was the proposal to introduce regional pay rates – paying teachers and other public sector staff in Newcastle less than people doing the same jobs in London.

Far from seeing the prosperity gap between richer and poorer regions as an evil which needs to be addressed, the idea of regional pay takes such inequality as an incontrovertible fact of life and then threatens to institutionalise it throughout the entire British economy.

Despite the efforts of some North-East MPs and union leaders, the proposal has received little national attention up until now, demonstrating once again the London-centricity of our national media.

But that may be about to change.  For the question of regional pay now appears to be playing into the much wider political narrative concerning the longer-term future of the Tory-Lib Dem Coalition.

In what can only be seen as a shot across Mr Osborne’s bows, Lib Dem leader Nick Clegg warned this week that his party could not sign up to a policy that would exacerbate the North-South divide.

It seems that regional pay has now joined the growing list of issues, alongside Europe, House of Lords reform and Rupert Murdoch, where the two parts of the Coalition are singing from increasingly varying hymn sheets.

Speaking to the National Education Trust in London Mr Clegg said: “Nothing has been decided and I feel very, very strongly as an MP in South Yorkshire, with a lot of people in public services, we are not going to be able simply willy-nilly to exacerbate a North-South divide.

“I think people should be reassured we are not going to rush headlong in imposing a system from above which if it was done in the way sometimes described would be totally unjust because it would penalise some of the people working in some of the most difficult areas.”

Perhaps the most heartening aspect of Monday’s speech was simply hearing a senior minister – the Deputy Prime Minister no less – talking about the North-South divide again.

It became practically a banned subject under Tony Blair, who first attempted to dismiss it as a "myth,” then tried to con the region into thinking something was being done about it by inventing a spurious target to narrow the gap between the three richest regions and the six poorest.

In one sense, Mr Clegg’s intervention is not unexpected given his own status as a South Yorkshire MP in what is a genuinely three-way marginal constituency.

Mr Blair’s former spin doctor Alastair Campbell has stated that Mr Clegg's only hope of retaining his Sheffield Hallam seat at the next election is to join the Conservative Party, and even making allowances for Alastair’s obvious partisanship, I’ve a sneaking suspicion he may be right,

But in the meantime, it is clearly in the Lib Dem leader's interests to try to put some clear yellow water between himself and the Tories on issues with a particular relevance to the Northern regions.

In view of the Lib Dems’ dismal performance in local elections in the North since the party joined the Coalition in 2010, it is surely not a moment too soon.

Mr Blair’s indifference to the whole issue of regional disparities was partly responsible for the Lib Dems’ dramatic surge in support in the region between 1999 and 2007, with Labour-held seats like Newcastle Central, Blaydon and Durham City briefly becoming realistic targets.

Meanwhile at local government level, the party took control of Newcastle from Labour, and actually managed to hang on to it for seven years before being swept away in the post-Coalition backwash of May 2011.

It will be a long way back for the party to reach those giddy heights again, still further if it is to mount a serious challenge for additional parliamentary seats in the region.

This week, however, Mr Clegg might just have taken the first step along the road.

A renewal of vows? Pull the other one

There is a school of thought that says that once a government gets itself into a position where it needs a relaunch, the brand is probably already so badly tarnished as to render the whole exercise pointless.

To be fair, the Coalition is probably not at that point yet. It is only two years into its existence, and governments of a far older vintage have come back strongly from similar periods of mid-term blues before now.

But the largely negative reaction to this week’s relaunch, with Wednesday’s Queen’s Speech at its centrepiece, does suggest that the government’s current difficulties go deeper than merely a run of bad headlines.

Coming in the wake of a disastrous Budget, a dismal set of local election results, and the continuing slow drip of damaging revelations from the Leveson Inquiry, it seems the Coalition is currently suffering from a bad case of the political Reverse Midas Touch.

Three major criticisms have been made of the legislative package announced by Her Majesty in what, for her, was surely the least eagerly-awaited public engagement of this her Diamond Jubilee year.

The first was that, with only 16 Bills, it was ‘too thin,’ but for my part, I wonder whether this was not in fact a point in its favour.

Over the past two decades, we have been subjected to an increasing deluge of legislation, for instance the 21 criminal justice bills spewed out by Tony Blair and Gordon Brown’s administrations over the course of 13 years.

A Conservative-led government, committed to reducing the burden of regulation and shrinking the size of the state, should perhaps have made more of a virtue of this year’s relative paucity.

The second most oft-heard criticism this week was that there was little or nothing in the programme specifically directed towards tackling the country’s current economic difficulties or producing a programme for growth.

But this, surely, is a category error.  Budgets, not Queen’s Speeches, are where you set out your economic policy, and Labour leader Ed Miliband should perhaps have known better than to make the main focus of his attack.

The third main criticism of the Speech – and the biggest one as far as most Tory backbenchers are concerned – was that it concentrated too much on Lib Dem hobby-horses such as House of Lords reform and not enough on issues that mat

Again, this depends on your point of view.  A second chamber elected by proportional representation from region-wide constituencies could well provide a stronger voice for regions such as the North-East – but I can well understand why the Tories, in particular, would not want that.

For me, the most fundamental flaw in Wednesday’s speech was not that it was too thin, too lacking in economic content or too Liberal Democrat, but that it lacked a unifying narrative which would give people a reason to support the government.

Say what you like about Mr Blair, his Queen’s Speeches never suffered from this deficiency, even if, as time went on, they tended to be more about protecting people from nightmares than giving them dreams of a better future.

Perhaps the reason it lacked a unifying theme because it was less the product of one man’s over-arching vision and more the product of compromise between the government’s two constituent parties.

In this respect, the most interesting political story of the week was not the Speech, but Prime Minister David Cameron’s interview with the Daily Mail in which he bemoaned his lack of freedom of action to do the things he really wanted.

What was especially notable about this is that, while Lib Dem leader Nick Clegg loudly and often complains about the Conservatives, Mr Cameron very rarely does the same about the Lib Dems.

Yet here was the Prime Minister saying:  “There is a growing list of things that I want to do but can’t…..there is a list of things that I am looking forward to doing if I can win an election and run a Conservative-only government.”

This week’s relaunch had been billed in advance by some cynics as the Coalition’s “renewal of vows,” but Mr Cameron’s interview shows this to be well wide of the mark.

In truth, it seems to be heading all the more rapidly for the divorce courts.

Bad news management costs Osborne dear

There is a hoary old adage in British politics that a Budget that looks good on the day invariably looks like a turkey a few weeks later.

But there can be few Budgets in the recent past which have unravelled quite as quickly as George Osborne’s latest package unveiled to MPs on Wednesday.

Within an hour of him sitting down, #grannytax was the top trending item on Twitter and the revolt against the Chancellor’s ‘stealth tax’ raid on pensioners was under way.

Rarely have the following days’ newspapers seen such a degree of unanimity over a Budget statement – or made such depressing reading for the man from Number 11.

Part of the largely hostile press reaction can be put down down to poor presentation and rank bad news management on the part of the government.

As one Labour veteran reminded us, Gordon Brown’s modus operandi was to get all the bad news out there beforehand and hold the good stuff back for a big ‘rabbit-out-of-the-hat’ announcement on the day.

The government appears to have taken the opposite approach with this Budget, with more leaks than a St David’s Day parade as one heterographically-minded blogger put it.

Indeed one reason it has had such a bad press is that most of the more positive measures were old news by the time the Chancellor got to his feet.

There were at least some good points. Annual tax statements will be a welcome addition to the public’s right to know, while the 2p cut in corporation tax ought to help meet the desperate need for new jobs.

And the imposition of 7pc stamp duty on the purchase of homes over £2m is the nearest we are likely to come to the Lib Dems’ cherished “Mansion Tax.’

Furthermore, despite its appalling presentation, I don’t necessarily go along with all the criticisms that have been made of the so-called ‘granny tax.’

As the Institute of Fiscal Studies has pointed out, pensioners have so far done better than younger people from the government’s austerity measures, and this at least helps even things up a bit.

Inevitably, much of the ire of left-of-centre politicians and commentators has been directed at the 5p cut in the top rate of income tax, worth around £42,500 a year to someone earning £1m.

It provided Ed Miliband with the best joke of the week – and perhaps of his leadership – telling the Prime Minister he will save so much that he “will be able to afford his own horse.”

A more serious moral point was made by the commentator Martin Kettle, arguing that the top-rate tax cut highlights the different worlds inhabited by the super-rich and the rest of us.

“The vast majority of us would be prosecuted if we opted not to pay [tax.] If the rich don’t pay, the law is changed to reflect the fact that they won’t pay up,” he wrote.

The economic arguments over the efficacy of the 50p rate will doubtless run and run, but this is perhaps one area where the politics should have trumped the economics.

If the 50p rate symbolised the fact that ‘we’re all in it together,’ then the political damage to the government engendered by its removal may well outweigh any economic benefit in the longer term.

The move towards a single personal tax-free allowance of £10,000 has been widely welcomed, but - just as Mr Brown once did – Mr Osborne is recouping some of the cost through so-called ‘fiscal drag.’

It means around 300,000 middle-income earners are finding themselves dragged into the 40p tax rate at the same time as top-rate taxpayers see their own rates cut by 5p in the pound.

But saving the worst till last, for me the most pernicious of all the Budget measures – at least as far as the North-East region is concerned - is the proposed introduction of regional rates of pay in the public sector.

As has been pointed out, this will only serve to entrench existing regional economic inequalities and institutionalise low-wage economies in areas such as the North-East, Wales and South-West.

The government’s argument seems to be that as private sector pay is lower in these regions, so therefore public sector pay ought to be lower too.

To me, that sounds suspiciously like two wrongs make a right.

Nothing gets politicians so worked up as a Boundary Review

THIS week, The Journal reported that there had been more than 900 objections lodged with the Boundary Commission over its plan to alter the face of the region’s one real rock solid Tory enclave – the parliamentary seat of Hexham.

The plans, drawn up last September as part of the government’s proposal to reduce the size of the House of Commons by around 50 seats, would see historic country boundaries crossed in the name of ‘equalising’ the size of constituencies across the country.

If the proposals go ahead, the North-East will see its overall representation in Parliament fall from 29 to 26 with no part of the region unaffected by the changes.

For some of the region’s MPs, it is likely to mean the end of the political road, while those that survive are will find themselves standing for re-election in constituencies almost unrecognisable from their existing ones.

In nowhere than Hexham has the opposition to the government’s plans been more intense.

All three main parties – including the Conservatives and their sitting MP Guy Opperman – have come out against the proposals, with the 950 letters of opposition equalling the number received in all the other 28 North East constituencies put together.

What the opponents of the changes find particularly galling is the fact that the proposed new constituency will breach the historic county boundary between Northumberland and County Durham, with Haltwhistle moving into a newly-created seat of Consett and Barnard Castle.

Other proposed new constituencies in the region – for example Newcastle North and Cramlington – will see the traditional divide between metropolitan and non-metropolitan areas breached, although, perhaps surprisingly, these seem to have aroused much less opposition to date.

But the ongoing debate over Hexham could prove to be a microcosm of a much larger battle over the government’s proposals which could yet influence both the timing and the outcome of the next general election.

In my column last week, I speculated that Nick Clegg’s proposals for House of Lords reform could ultimately prove to the rock on which the Coalition founders, with Conservative peers, who want to maintain the second chamber’s built-in Tory majority, threatening to derail his plans.

What does that have to do with Parliamentary boundaries, I hear you ask? Well, potentially quite a lot.

For the Lib Dems are threatening to retaliate against the potential loss of their leader’s cherished Lords reform plans by scuppering the Tories’ attempts to reduce the number of MPs.

Now at first sight, you might think this was yet another ill-judged policy intervention by the Lib Dems that is likely to prove about as big a vote-winner for them as their support for the Euro.

Years of mounting public cynicism about politicians – capped by the MPs’ expenses scandal – have created a climate in which any party advocating a reduction in their numbers is likely to be on pretty firm electoral ground.

But politicians are never so exercised as when their own jobs are under threat – and for that reason alone, a Lib Dem revolt against the boundary review proposals could have a very real prospect of success.

A small number of Tory MPs affected by the changes – some of them only elected for the first time in 2010 and whose parliamentary careers face being cut off in their infancy – might even be persuaded to join such a rebellion.

This is not just about the Lib Dems getting their own back on the Tories, though. There is undoubtedly an element of calculation in the party’s stance.

It is estimated that the boundary changes will be worth an extra 20 seats for the Conservatives at the next election – some of which will undoubtedly come at the expense of their Coalition partners.

The changes will therefore make it much more likely that there will be a majority Conservative administration next time round, and correspondingly much less likely that the Lib Dems will again be in a position to hold the balance of power.

Killing off the boundary review might yet be the Lib Dems’ best hope of hanging onto their ministerial limousines. And it might even win them a few votes in Hexham.

The Coalition will not last five years

In last week's column, I suggested that the key strategic task facing the Liberal Democrats as they gather for their spring conference in Gateshead was to find a way of winning back the support that has deserted them since they joined the Coalition in 2010.

And doubtless there will be plenty of ideas floating back and forth at The Sage this weekend as to exactly how they should go about it.

They could, as some argue, stop the Health and Social Care Bill in its tracks. The Guardian commentator Polly Toynbee is among those warning this week that if they don’t take what may be their last opportunity to do this, it will seal their fate as a party.

Or they could, as Business Secretary Vince Cable has suggested, use their influence to help shape next month’s Budget, taking everyone earning less than £10,000 a year out of tax and introducing a ‘mansion tax’ for the super-rich.

Their leader, Nick Clegg, certainly wants to see the party getting on the front foot and proclaiming its successes in the Coalition rather than apologising for being part of it.

“Now it is time to move on. To stop justifying being in government and start advertising being in government. To stop lamenting what might have been and start celebrating what is. To stop defending our decisions and start shouting our achievements from the rooftops,” he said yesterday.

But whichever way they turn, will it make the slightest difference to the party’s electoral prospects?

Well, if history is any guide, no. The plain facts of the matter are that involvement in a Coalition is almost always disastrous for the smaller party, whatever political achievements it manages to extract from it.

The most recent example was the Lib-Lab pact in 1977/78. This was perhaps the most enlightened and humane period of government in my lifetime, but it still ended up doing the then Liberal Party terrible damage.

Far from emerging strengthened, their vote went down at the subsequent general election in 1979 and several of their most high-profile MPs, including the deputy leader John Pardoe, lost their seats.

Further back, the 'National Liberals' who joined the Tory-dominated National Government in the 1930s ended up simply becoming absorbed by the larger party.

And David Lloyd George’s 1916-22 Coalition, in which the Tories also held a numerical majority, likewise ended disastrously for the Liberals and their leader despite victory in the First World War.

It is partly for this reason that I have argued from the outset of the Coalition that, while the Lib Dems probably had no choice but to join it, they also needed to find a way of getting out of it alive – preferably well before the next election is due.

The Health and Social Care Bill, on which the Lib Dem rebels are more in tune with public opinion than the government is, would have given them a plausible pretext, although the party activists’ last-ditch bid to halt the Bill now looks unlikely to succeed.

Europe, by contrast, would not be a good reason for the Lib Dems to try to collapse the Coalition, for the simple reason that on this issue, it is the Tories who are much closer to the mainstream public view.

One less widely-canvassed possibility is House of Lords reform – not the sexiest of issues, for sure, but one on which the Tory ‘backwoodsmen’ seem almost certain to thwart Mr Clegg’s well-meaning attempts to drag the British Constitution into the 21st century.

The last time I discussed the possibility of the Coalition ending before its due-date of 2015, a commenter on my blog reminded me that the government has already passed legislation to bring in five-year fixed-term Parliaments.

My view, however, is that this could turn out to be no more than a quaint constitutional notion, given that the legislation also allows for a two-thirds majority of MPs to dissolve Parliament ahead of its term.

Let’s just suppose that David Cameron decides he wants an election. Would Labour MPs, in such circumstances, really vote to keep him in office until 2015?

It stands to reason that the Coalition will not last five years. It will, rather, last just as long as both of its partners want it to.

The real issue which the Lib Dem spring conference needs to address

Back in the bad old days of two-party politics, the Liberal Democrat spring conference was one of those recurring events in the political calendar which even political journalists struggled to get too worked up about.

Sure, the BBC invariably ran a short item about it – but that was only because its rules on impartiality oblige it to give Lib Dem gatherings the same coverage as those of the other two main parties.

How times have changed, however. Not only is this year’s spring conference in Gateshead a big story in the North-East, but it is also set to attract the kind of national media attention which the third party could once only dream of.

At stake could be the future of a flagship piece of government legislation – and in the longer-term, the future of the government itself.

Last year’s spring conference saw Lib Dem activists effectively force their Tory coalition partners to order a ‘pause’ in the controversial Health and Social Care Bill designed to hand large parts of the NHS over to GP consortia and increase competition across the service.

A year on, and this year’s may yet result in the hated Bill’s final demise.

Alongside Europe, the Bill remains perhaps the biggest point of division between the two Coalition partners, despite continuing attempts by both party leaderships to soften it at the edges in the hope of avoiding a showdown.

But even a desperate entreaty by party leader Nick Clegg and much-loved veteran Baroness Williams this week looks unlikely to head-off an attempt at next week’s gathering to kill of the legislation once and for all.

Unlike on Europe, it has been clear for some time that the Lib Dem tail is wagging the Tory dog when it comes to the NHS.

Earlier this week, Lib Dem peers put forward a fresh series of amendments to the Bill in the House of Lords designed to further water down the requirements for increased competition.

Initially, the government said it was ‘not minded’ to accept the amendments, but once they were duly passed, it decided not to try to overturn them.

At the same time, Mr Clegg and Lady Williams issued a letter to party members saying that the Bill as now amended contained all the necessary safeguards and should therefore now be “allowed to proceed.”

Early signs are, however, that activists are determined to press ahead with a conference vote on the motion, which calls for the "deeply flawed" Bill to be "withdrawn or defeated.”

One prominent Lib Dem, Graham Winyard, has already resigned from the party over the issue, warning Mr Clegg that his support for the bill would be "a slow-motion disaster" for the NHS and the party.

Labour has not been slow to seize on the divisions, with shadow health secretary Andy Burnham attacking Mr Clegg’s “stage managed posturing” over the Bill.

He urged Lib Dem rebels to work with Labour and dismantle the Bill to remove the provisions relating to competition.

But of course the Lib Dems’ problems go much wider than health. Their real difficulty lies in the fact that voters have deserted the party in droves since it joined the Coalition.

In this sense, it is ironic that they are meeting in the North-East at a time when the party’s standing in the region has possibly never been lower.

A poll carried out by YouGov the week before last showed the party now has the support of just 4pc of the region’s voters – lower than the UK Independence Party on 7pc.

The days when the Lib Dems entertained serious hopes of winning parliamentary seats such as Blaydon and Durham City now seem a very long way away indeed.

Under Charles Kennedy’s leadership from 1999-2006, the party pursued a successful strategy of appealing to disaffected Labour voters as well as its own traditional supporters, gaining its higher number of MPs since the 1920s.

It is now facing the nightmare scenario of its parliamentary representation being reduced to single figures for the first time since the revival of third-party politics began in the 1970s.

It is hard to dispute the analysis of Gateshead councillor Ron Beadle that, in electoral terms, the Coalition has been a “disaster” for the party.

This, not the future of the health bill, is the real issue which this spring conference needs to address.

Advantage Tory right as Huhne exits stage left

So farewell then, Chris Huhne – well for the time being at any rate, as the erstwhile Energy Secretary quits in order to fight charges of perverting the course of justice in relation to a driving offence committed in 2003.

The leading Liberal Democrat politician was left with no choice but to resign from the Cabinet yesterday after effectively being charged with lying to the police over whether he or his ex-wife was driving at the time of the incident.

Mr Huhne, who continues to deny the charges, will now have to clear his name if he is to stand any chance of resuming what has been an eventful career over the course of less than seven years as an MP.

For now, though, his Lib Dem colleagues will have to manage without his combative presence around the Cabinet table as the curse that has seemed to bedevil the party’s senior figures since the last election strikes again.

They lost their cleverest minister, David Laws, within 16 days of the Coalition taking office, and nearly lost their most well-known, Vince Cable, over his ill-judged pledge to destroy the Murdoch empire – uttered before it succeeded in destroying itself.

Now they have lost their most abrasive in Mr Huhne, the stoutest defender of the party’s interests within the government and, by some distance, the Tory backbenches’ least-favourite Liberal Democrat.

Few Tory tears will be shed at his departure. Right-wing internet bloggers who have had Mr Huhne in their sights for some time were literally cracking open the champagne yesterday morning – and one even posted a video of himself doing so.

The evident Tory glee demonstrates the fact that Mr Huhne’s enforced resignation is likely significantly to alter the balance of power within the Cabinet in their favour.

His successor Ed Davey is a capable minister who deserves his Cabinet promotion - but he is no Chris Huhne, described by one commentator yesterday as a “political bulldozer who would try relentlessly to get his way, and who was not averse to media shenanigans to advance his cause.”

It was Mr Huhne, rather than Nick Clegg, who led the attack on the Tories over their handling of the referendum on the voting system last May, when Mr Cameron gave the green light for a series of bitter personal attacks against the Lib Dem leader.

And it was he who articulated the Lib Dem rage over Mr Cameron’s decision to veto a new EU treaty at the Brussels summit in December.

What gave Mr Huhne a particular degree of authority within the Cabinet was his strong power base within the party as a two-time leadership contender and de facto leader of the party’s social democratic tendency.

He could very well have become his party’s leader instead of Mr Clegg, had not a pre-Christmas postal strike in 2007 led to thousands of votes in his party’s leadership election arriving after the ballot boxes had closed.

Until yesterday, he would have been the likeliest replacement for Mr Clegg were the latter to have been forced out by party activists still grumbling over his decision to join the Coalition.

Westmorland and Lonsdale MP Tim Farron, the party’s distinctly Coalition-sceptic president, now looks odds-on for that role, possibly as soon as 2015 in the event of Mr Clegg’s three-way marginal Sheffield Hallam seat turning either red or blue next time round.

The short-term impact, then, of Mr Huhne’s departure is that it will embolden the Tory right and make this look even more obviously a Conservative-led government than it already is.

This in turn will be good news for Labour and Ed Miliband, whose essential line of attack on the Coalition is that it is a Tory government in all but name, and who this week restored some of his party’s sagging morale by putting Mr Cameron on the back foot over bankers’ bonuses.

The real nightmare scenario for the government, though, would come if Mr Huhne were to go to jail – forcing a by-election in his highly marginal seat of Eastleigh which would pitch the Lib Dems and the Tories against eachother.

And the potential consequences of that for the Coalition hardly need spelling out.

Review of the Year 2011

Ever since the formation of the Coalition between David Cameron’s Conservatives and Nick Clegg’s Liberal Democrats in the aftermath of the May 2010 general election, British politics has by and large been dominated by two interrelated questions.

The first was whether, in spite of the obvious chemistry between the two leaders, an alliance between two parties with such vastly differing worldviews could actually come close to achieving its stated aim of governing for a full five-year Parliament.

The second was whether the tough economic measures it adopted would succeed in tackling the deficit, as the Tories had argued during the election campaign, or merely succeed in choking-off an incipient recovery, as Labour had warned.

Eighteen months on, those questions remain unresolved, but as the political year 2011 draws to a close, we are at least a little closer to knowing the answers.

On the first point, I wrote at the start of the year that if the Coalition managed to get through 2011, it would in all likelihood survive until its target date of 2015.

In making that prediction – which I may well be forced to revise over the coming 12 months - I was looking to May’s referendum on reform of the voting system as the likeliest breaking point between the two partners.

As it turned out, the Lib Dems’ crushing defeat in the referendum did not prove the Coalition breaker some of us thought it might, despite Mr Cameron having apparently given his party the green light to launch some bitter personal attacks on Mr Clegg.

And late in the year another issue emerged which on the face of it now seems much more likely to prevent the Coalition going the course: Europe.

Mr Cameron’s self-imposed isolation at this month’s European Summit capped what on the face of it was not a great year for the Prime Minister.

He found himself forced into a series of policy U-turns – over privatising forests, reducing prison sentences for defendants who plead guilty, and most notably over the ill-judged attempt to impose competition on the National Health Service.

Meanwhile the phone-hacking affair at the News of the World threw the spotlight on Mr Cameron’s close personal links with the Murdoch empire, while the travails of his defence secretary Liam Fox forced him into his first reshuffle.

And with the economy flatlining and unemployment on the rise, Chancellor George Osborne was forced to revise growth forecasts downwards and borrowing forecasts upwards as he conceded that the deficit would not, after all, be paid off in the current Parliament.

The fact that, in spite of all this, Mr Cameron ended the year ahead in the opinion polls probably says less about him that it does about the plight of the Labour opposition.

Party leader Ed Miliband’s one big success – and it was a not inconsiderable one – was to lead the attack on Murdoch and in so doing prevent him taking control of BSkyB - the first time the political establishment had stood up to the ageing media mogul in three decades.

He also made by far the most substantial of the three party leaders’ speeches in what was otherwise a distinctly unmemorable conference season, setting his face against the “fast buck culture” of the Thatcher-Blair years.

But the largely negative public reaction to the speech showed the extent of his task in winning over an electorate that still seems resolutely underwhelmed by him, and as Parliament broke up for Christmas, the muttering about his leadership in the Labour ranks was growing.

Mr Miliband’s failure to make the political weather was all the more baffling given the grim economic news, which increasingly appeared to bear out Labour’s warnings against cutting “too far, too fast.”

Inevitably the impact of the cuts was most keenly felt in the North-East, where more than 30,000 public sector jobs disappeared at a time when they were apparently still being created in other more prosperous regions.

But Labour remained hampered both by its failure to articulate a clear position on the deficit and by its perceived complicity in having created the problem in the first place.

And unless and until the public changes its collective mind about who is really to blame for the country’s economic plight, Mr Cameron’s continued political ascendancy seems assured.

Osborne's date with political destiny

‘Make or break’ is doubtless an overused term in politics. Many are the times when it is said that a politician needs to make the “speech of his life” on such and such a day, only for the same old cliché to be trotted out again the next time he makes one.

Yet for Chancellor George Osborne, this Tuesday’s autumn statement on the economy is genuinely shaping up to be one of those dates with political destiny.

For years, Mr Osborne has been the man with the plan as far as the Tory Party is concerned, and his plan on taking over at No 11 Downing Street in May last year was straightforward and simple.

It was: sort out the deficit in the first couple of years, wait for economic growth to start kicking in again, sprinkle some carefully-targeted tax cuts around, and then win the next election hands down.

But it’s all gone horribly wrong. Far from providing a platform for new growth, 18 months of austerity measures have pitchforked the economy back towards the ultimate horror of a double-dip recession.

As such Mr Osborne’s masterplan for economic recovery – and outright Tory victory in 2015 – now looks hopelessly optimistic.

And of course, it is not just the fate of the economy and the government that is at stake here, but Mr Osborne’s own chances of succeeding David Cameron as Tory leader.

If recovery comes and the Tories win an overall majority next time, there will be nothing to stand between him and No 10. But if they lose – or are forced into another five years of coalition - it will be Mr Osborne who gets the blame.

All of which make Tuesday’s statement if not quite the “speech of his life” then certainly the most important he has made since that Tory conference address of 2007 which frightened Gordon Brown off from holding an election.

To succeed, he must somehow manage to reconcile two seemingly contradictory goals.

Firstly – and this almost goes without saying - he must manage to reassure the markets that the government remains serious about tackling the deficit.

But equally, he now needs to reassure an increasingly sceptical public that the government has a plan for growth – if not a ‘Plan B’ as Labour still insists on calling it, then at least a Plan A-Plus.

It is already clear from several strategically-placed leaks that switching more spending into capital investment in infrastructure is going to be central to Mr Osborne’s plans.

It all seems a far cry from the days when Margaret Thatcher commented sniffily: “You and I come by road or rail, economists travel on infrastructure” – but no matter.

Chief Secretary to the Treasury Danny Alexander gave an insight into the government’s thinking in a speech to the National Association of Housebuilders on Wednesday.

"We are shaking the Whitehall tree to make sure no-one is stockpiling capital that can be put to good use today. That's why next week's announcement will switch funds to capital spending plans,” he said.

This is all of a piece with Mr Cameron’s speech on Monday setting out measures to boost the housing market, both by encouraging the construction of more homes and by helping first-time buyers obtain mortgages.

And yesterday Deputy Prime Minister Nick Clegg got in on the act by pre-announcing a £1bn scheme to help the young unemployed, apparently to be paid for by further savings in other areas.

The risk for the government is that it will all be too little, too late to counteract the chilling effects of 18 months of what Labour leader Ed Miliband this week called “austerity rhetoric.”

But if he can use Tuesday’s statement to get the economy moving again at last, then it may yet all come right – for the coalition, for Mr Osborne, and most importantly for the long-suffering British public.