Conference Special Daily Politics

Afternoon, folks, welcome to this Daily Politics conference special

live from Birmingham. They are working up a head of steam

against the rich, the Tories, their partners.

Later this morning, the Business Secretary, Vince Cable is to unveil

his plans for curving ective pay. We bring that live. The party is in

Tory bashing mode, in the hope it restores the identity and repair

its ratings in the polls. They are dire. That is for the

party and its leader, Clegg. The party are at 11% and 60% of the

people have no idea when the Lib Dem leader stands for.

Vince Cable is to vent his annual splurge of populism before the

party faithful. Last year he called the bankers, perspectives and

conmen. This year, he is targeting highly paid executives. He is

talking to the Energy Secretary, Chris Huhne, about all of that and

more. We go existential and ask, why are we here? Why oh, why? Does

a Lib Dem conference matter were you are in coalition with the

So, all of that and more is coming up in the next hour.

It is TV conference gold. Public service broadcasting at its finest.

With us to kick it off we have Sam Coates from the Times and Nick Watt

from the Guardian, despite that, they are both friends, both of them.

What is the mood of the conference? This is cheery. This is the first

time in three or four years where there has not been a great fight at

conference. What a lot are hoping is that broadly speaking the polls

have bottomed up. There is an ever so slightly uptick in many of the

opinion polls, they are hoping it will not get worse and they can

start rebuilding the reputation ahead of a next election. Yes it is

bad, but I was speaking to a senior Lib Dem official, who said if you

remember how unpopular Tony Blair was after the Iraq war, he still

managed to win in 2005. We have to remind people that things are not

as black as they are sometimes painted.

What do we make of the status of Nick Clegg? Back in May you may

have thought this would be a lynch mob it is not that, but what...? I

was at a fringe event, he spoke, half of the people in the audience

were speaking amongst themselves? We all like to talk about economics.

We have to take the economics analogy. That the Liberal Democrats

have experienced sick kl growth, but the underlying structural

position is dire. The growth is that at the time of the alternative

vote when they lost they were on the floor. Nick Clegg looking like

he was bleeding. They have managed to differ enSecretary of State

themselves on the NHS, the tails are up, but the underlying

structural position, facing the electorate in 2015, that is not

looking good, they are still at the 11, 12% in the opinion polls.

That is your views, but I have made a wee extra in Glasgow.

Here in Birmingham, there is more security than ever it must mean

that the Lib Dems matter at least. The theme of the conference is in

Government on your side, but not if you are a Tory. They may be in

coalition with the Tories, but the Lib Dems favourite sport at this

conference is whack a Tory. Like the Tories, the Lib Dems are

worried that the economy is grinding to a halt, but unlike the

Tories, there are many Lib Dems who would like to see more fiscal

stimulus and more printing of the money. I asked Danny Alexander if

his plan A was still working or if there was a need for a plan A plus

or even a plan B? The credibility that we establish, the commitments

that we have made on the deficit reduction mean we are not facing

the problems that many countries are facing. Looking around the

eurozone there are doubts about the capacity of leaders to make the

right decisions. Looking to the United States, their

downgrade came from the rows going on in their political system.

Having political leaders who take difficult decisions and sticking to

them is important at a time like this. That is the view from the

bridge, but what is the view from the deck along -- among the Lib Dem

rank and file? Have you reservations about being in bed

with the Tories? Of course! But is there no alternative? In this case,

that was the, it was the least worst decision that could have been

made at the time of the election. think that the two coalition

partners have worked together rather more co-operatively than

imagine that they may have at one point.

That they could have been scratching their eyes out? That

could have been a possibility. Would you like a badge? It does not

express what I feel. I like the coalition... So you may wear that?

Would you like to hold on to it? will keep it

Four months away in a terrible local election results in the

defeat of the alternative vote referendum, Nick Clegg must have

felt that Birmingham would turn in a lynch mob, but it has not. The

position is secure, but the average Lib Dem activist is still uneasy,

even angry about being in bed with the Tories.

Gems of wisdom, I think. Would you not agree? What would we do without

you. I know. 50P tax rate? Am I right in

thinking that they are going along in getting rid of it as George

Osborne wants to do it, provided that they get something in return?

And don't forget that George Osborne has done this study, he has

said that he cannot get rid of the 50p tax rate until 2013 as it has

to be in line with the pay freeze for the public sector workers, but

there must be two things, one, getting the money you would have

raised from the richer people through the mansion tax and the

focus on tax cuts has to be on the lower earners and raising the

coalition allowance, it talks about raising that lower income earn up

to �12,000 so nobody on minimum wage has to be on that rate of tax.

All of this Tory bashing, do the Tories care? There will be lots of

Lib Dem bashing by the time we get to a Tory conference in a couple of

weeks' time. So this is grown up? Yes. This is

about reminding the party that they can have freedom inside of the

coalition. Take the 50p tax rate, it is not live, it does not feel to

me inside government. It is an artificial construct.

To differ enSecretary of State? between the two parties and to

cheer the troops along it is depressing that the coalition

policy work like that, but that is what it takes. They have a licence

to disagree, they will get to the same position. What is interesting

is what Vince Cable will be saying when he is talking about cracking

down on boardroom pay. His people are saying that this is going to

happen over David Cameron's dead body, so that they know it is

unlikely to happen. They know it will not happen. David Cameron is a

young, fit chap, he will be fine. They know it will not happen. You

have to say why are you doing it? It is one thing to differ

enSecretary of State yourselves from the Conservatives, but they

must not be a mini opposition. If you are putting up these ideas,

that Vince Cable knows is not going to happen, you have to be careful

not to cross the line. But there is a bigger problem for

Vince Cable. It is this: Most of the business world would like a

Business Secretary that champions business. He seems to needle at one

end and what the objection for many Tories is that he does not to

anything for the growth and the expansion of the private sector

that is critical. Somebody prepared to put the rocket boosters behind

British business, rather than making it difficult.

We will put that to the director of -- to Miles Templeman.

In a moment we are talking to Chris Huhne, first, a couple of emergency

debates this morning. Let's hear what was said from the conference

floor. The fundamental liberal principles

of a free independent, and unfetered estate, holding power are

sacrosanct for Liberal Democrats, but so, also, are the democratic

principles of accountability and transparency. We do not tolerate

unethical behaviour from other professional groups that hold great

responsibility, we must not tolerate it from our journalists.

Freedom and accountability are not incompatible. So this motion

insists on a pulsory code of conduct to be the part of every

journalist's contract. We have sufficient officers who are trained

who have the sufficient equipment, but need the leadership to be

effective. We need policies like restore tiv justice that prevent

reoffending rather than draconian sentences being passed because

magistrates and judges come under political pressure.

With me now, via popular acclaim, the energy and Climate Change

Secretary, Chris Huhne. A big title? Not as big as your 's,

Andrew! That is true. Tim Farron, I believe he is the President of Your

party? He is. He -- He says that the Government would be, "A

nightmare without the Lib Dem ministers" Is he right? It would be

more interesting. Is nightmare? To be clear, I do

think that the political balance of the government is a coalition,

between the Liberal Democrats who have a clear, independent stand on

a number of issues and the Conservatives also who come from a

different political tradition. We have to come promisise. There is

nothing to be ashamed of in come promisising. If we had not to get

us out of the economic problems that time that we had, it would

have been difficult in failing to compromise in the budget over

losing the triple A status. Now, Europe. Should Greece be given the

next trench of emergency aid? is to be entirely up to the

eurozone and entirely up to the conditions... When I have not been

involved in the negotiations, I think it is key that the Greeks

stick to their commitments. Not to cut? Part of the problems

began when the Greek Government did not present accounts which were

correct about the size of their budget deficit and the size of the

debt. They got into the Euro area under false pretences.

But we knew that? No we did not. France did it, so did Italy? No. No.

No other country has actually falsified its national accounts in

the same way that Greece did. But Italy did not meet the criteria

it got in with 112 % of GDP? If you are so far away from the criteria

that there is no room for interpretation, there is the other

room, Italy, was the debt falling, it was, that was allowed, there was

wriggle room, but the Greek Government presented figures that

the current Government found out about at the election that were

completely false. It was like Enron falsifying their accounts, that is

really outrageous. OK. You follow these things closely.

In your view, is it inevitable that Greece will default? No. Nothing is

ever inevitable. Is it likely? In the current

circumstances, the real issue for Greece and the eurozone is to put

together a package that allows it to be a sustainable solution going

forward. One of the difficulties if Greece were to default is that

there are a number of banks within and outside of the Euro area that

could be negatively affected. I remember back in the crisis that we

had here in the UK in the 1980s, when we had Lloyds and the Middles

who had more than their entire capital reserves outstanding, even

to American companies, all in default. If we crystallise the

default then and there, we would have had two big High Street banks

going bust. We did not do that. We waited, they built up reserves, in

the threatened is the Brady restructuring to ensure a long-term

My hunch would be that we have underestimated the political will

of people on the Continent to keep the show on the road. I believe, in

general, it is rash to assume that things are going to fall apart in

the European Union. Actually, our experience is that Europeans use a

good crisis to build up, solve the problem and get back on the road.

The Financial Times this morning has done calculations, using the

same methodology as the Government, and has discovered that the

structural deficit, the bit which does not disappear when growth, is

actually �12 billion higher than the government calculated. Does

that mean there will have to be more austerity measures?

Financial Times, bless them, is a journalistic organisation, not a

well-established and reputable authoritative international

economic organisation. Take the IMF, the OECD, both of them for the

serious calculations of the structural balance. They know that

different methodologies to the Treasury. I think that is more

likely. So the Financial Times is wrong? I have no idea whether it is

wrong or right, but the government should not, given that we have put

in place a framework with the Office for Budget Responsibility,

an independent body with a lot of resources designed to come up

with... But they have used the OBR's mechanism to calculate this.

Are you saying the FT is not authoritative on these matters?

does that have the final word. One of the things that we are clearly

going to see is that the director of the Budget -- the Office for

Budget Responsibility will hold forth on these matters. That is the

appropriate body for putting forward, if there is a problem of

this sort, to the government, and the OBR is the independent body

under started that is charged with coming up with this analysis, that

they find a problem, we will respond to it. -- and a statute.

those calculations are right, and we will find out from the OBR, if

there is a �12 billion structural deficit, bigger than you have been

proceeding along, will we have to cut more? It is absolutely clear

that the Government is committed to ensuring that we have a sustainable

structural balance, that is an absolutely key commitment. It has

what has got us out of the dangers on that we were in immediately

after the election. -- the danger zone. A number of countries have

fallen into economic crisis since then, even though they have smaller

budget deficits than we do. We have been able to get out of that danger

zone because our commitment to incredible physical programme.

still not clear if you're going to have to cut more. 9 am I, because

it will depend on the recommendations of the OBR. --

neither am I. That is the appropriate way of doing it, not

reacting to something that appears in newspapers, no matter how

reputable they are. I used to work for the Economist, not the

Financial Times. We were colleagues for a brief period. It is 50% and

by the Financial Times. And a very good investment it has proved for

them! We are going to hear from Vince Cable in a minute. What has

he done for business? I think the key thing he has done is to make

sure that with the deregulation that is going on, where we can get

rid of excessive red tape, that is being done... What is the big

thing? It is a whole raft of rules. What is the biggest the regulatory

change? The obviously follows his department, and I follow mine. I am

the Secretary for Energy and climate change. The singers beggars

proposers what we are trying to do on the planning rules, which is

very controversial. That the single biggest proposal. Is that his

department? It is part of the deregulation, part of the growth

review... Of so what has he done for business? That is a key thing.

It is not his department. He has been involved in the road review

from the beginning, coming up with the ideas that we have been putting

in government. -- the growth review. He will continue that work as he

has done since the election. Miles Templeman is the head of the

Institute of Directors. What are you looking for from Vince Cable

this morning? We are certainly not looking for what we think we can to

get about executive pay, quite the wrong issue to be talking about

when we are really trying to encourage growth, stimulating

investment, get overseas people to come here. It is that to be talking

about that topic at this stage. -- daft. War would be wrong with Kevin

executive pay? The ratio to normal pay is far higher than it has ever

been. For a start, you are only talking about the very top

executives. Most executives get nothing like that, as he would

appreciate. The average director earns about 75,000, a good salary.

That is a non-executive. No, no, that is an executive director.

in the FTSE 100 for 250, they earn a lot more than that. Not most

directors. In the 1950s, they earned about 40 times average

earnings. Today they earn 400 times average earnings. Why? It varies

dramatically between companies, as you know. Basically, you are in a

marketplace of directors. You have got to pay them what they can get

internationally, and that is the price. It is the same in any sport

or music or anything. The top people are earning a lot more. What

I would like to see is more emphasis on how we get the lower

paid people to earn more, rather than trying to hold back those were

creating wealth and stimulating business. A wee are about to hear

from Mr Cable. I just hope we will be an odyssey in going up in a

second. Can I just ask you this, do you take what he is saying

seriously, or is it just conference rhetoric? I hope it is just

conference rhetoric, because it is not something that would help

business and the economy. All right. We are going to have delivered

there, he is on his feet. Straight into the conference hall to hear

When I joined up, I had very mixed feelings about the coalition. Like

many of you, I looked for good precedents. I thought of Clement

Attlee and Aaron Bevan, working with their Tory opponents,

Churchill and Beaverbrook, setting aside their political differences

in a common cause. Of course, that coalition unleashed the great

liberal reforms. You could say, well, that was war, that was

different, and it is different. But we now face a crisis that is the

economic equivalent of war, and this is not a time for business as

usual for politics as usual. The financial crisis is still with us.

It never went away. And we can now say that recovery has stalled in

the United States and the position in the eurozone is, well, Dyer. But

it is wishful thinking to imagine that we have a healthy economy

which has somehow been infected by a dangerous foreign virus, because

many of our problems are home-grown. Gordon Brown regularly advised the

rest of the world to follow his British model of rock, but the

model was flawed. -- growth. It led to the highest level of household

debt in relation to income in the world. It produced a dangerously

inflated property bubble. It encouraged bloated banking, while

manufacturing declined at an unprecedented right. And then they

socialised the cost of the crash through a massive budget deficit,

the biggest of any major economy. And his disciple, Ed Balls, highers,

well, sort of apologised, but now advocates policies that would

repeat that disaster. -- has. What this period of crisis should have

taught us, above all, his humility. And humility in politics means

accepting that one party does not have all the answers. Recognising

that working in partnership is And it has been hard, and it has

required courage from our party to withstand the tribalism which is

British politics at its worst. And it has not been possible for the

party to get its own way on everything. I mean, I regret this

year that we did not secure a tighter control on bank pay and

bonuses, for example. A bad message was sent that unrestrained greed is

acceptable, and we now know where that leads. What we do have are

very real achievements. My team in the business department, and I want

to acknowledge David Willetts and our own outstanding minister Ed

We have not only made a major contribution to deficit-reduction,

but we are now helping recovery. We are greatly expanded

apprenticeships, giving respect and recognition to the 60% of young

people who do not pursue academic study at universities. We have

protected our science budget, and we have launched a chain of

Technology Innovation centres promoting the technologies of the

future. We have established a green investment bank to promote major

green projects, and Nick Clegg has driven the regional growth fund,

investing in businesses up and down the country, not just in the south-

east. And we, and Ed Davey in particular, have done what

Conservative and Labour governments failed to do, legislate for the

necessary reform of the Royal Mail, with worker shares, providing a

stable future for the post office network. And then, after a

generation of manufacturing decline, we brought jobs back to Britain in

stealer at Red Care, a motor vehicle supply chains, electric

vehicles, and in aerospace through Rolls-Royce, Airbus and Augusta

Westland. And this morning, Jaguar and Land Rover announced that they

are to build a new engine plant in the West Midlands, a massive boost

for British manufacturing and for And that is what I mean by a

business recovery, cars, not But this work is just beginning.

Because to turn Britain around, we need much more. And I have three

priorities, stability, stimulus, solidarity. Stability in the

government's finances, the deficit problem, and in our banks. Stimulus

to support growth, and that sustainable growth based on

business investment, exports, green technology and manufacturing. And

solidarity to give people a sense of a shared society, reducing our

appalling inequalities of income and wealth, and creating a

responsible capitalism. Let me start with stability. The last

government promised an end to boom and bust, but it gave us both. And

it left us a dangerous, unsustainable budget deficit. And

cutting that deficit is a thankless and unpopular task, but it is

unavoidable if our country and party are to be taken seriously.

And the government's tough approach to deficit reduction is often

attacked as ideological, as right- wing. The truth is that financial

discipline is not ideological, it is a necessary condition for

effective government, and I see us following in the footsteps of

Stafford Cripps and Roy Jenkins in post-war Britain, and it brought

the Canadian Liberals, Scandinavian Social Democrats, the Clinton

Democrats in United States, because they understood, unlike today's

Labour Party, that the progressive agenda of centre-left parties

cannot be delivered by bankrupt I think most of the British public

to get it, but there are politicians on both Left and Right

who do not, and some of them believe that governments, like

Father Christmas, they draw up lists of tax cuts and giveaways,

and they assume that Santa Claus will pop down the chimney and leave

presents under the tree. This is childish fantasy. Some of them, for

example, believe that if taxes on the wealthy are cut, new revenue

will miraculously appear. And I think the reasoning is something

like this, all those British billionaires who demonstrate their

patriotism by hiding from the taxman in Monaco for some Caribbean

bolt hole will come rushing back to pay more tax at a lower rate. Well,

I'm afraid that my view of this is Financial stability is not just

about the Government's deficit. Massive potential instability is

caused by British-based global banks whose combined assets are

over 400% of the size of our economy. The largest of any major

country. And that the present, banks offered a one-way bet. If

they gambled and win, they fill up the bonus pool, and when he loses,

the taxpayer pays. And the Independent Banking Commission, the

Vickers commission, provides a means to stop this dangerous

nonsense. The commission's key findings, which are two separate

retail and casino banking, must be put in place. Legislation will

start soon, and it will be APPLAUSE.

And if there are any doubts about the need for radical reform, the

UBS rogue trader is to dispel them. We simply cannot have rogue

institutions, exposing taxpayers to the risk of exploding financial

weapons of mass destruction. APPLAUSE.

But the banks must also perform their basic economic function.

Which is channeling our savings, into productive investment.

They are doing so. Productive British business and banking are

currently at odds. Banks operate a bit like a man who

either wears his trousers around his chest stifling breathing, which

is what they do at the moment or around their ankles, exposing their

assets. APPLAUSE

That's if they have any! We want the trousers around the middle!

Steady lending growth, especially to protective British businesses,

small-scale enter prices, that is what they have to do. No more feast

and famine in bank lending. APPLAUSE

Now the big economic policy question now is how-do we pro gres

from financial stability to growth? -- progress from financial

stability to growth? With business and consumer confidence so low,

there is a responsibility on Government. My job is to support

businesses. That means promoting British

commerce in the big emerging markets that have been neglected in

the past. It means keeping Britain open to

inward investment, to trade, to students and skilled workers.

It means cutting red tape which is suffocating growing companies which

create jobs. Well, I I will not provide cover

for the ideological deendents of those who once sent children up

chimneys. Panic in financial markets will not be stopped by

scrapping maternity rights. APPLAUSE

But the immediate threat is lack of demand.

With consumers, companies and governments cutting spending, there

was once a talk of a paradox of thrift where everyone in every

country is individually wise, but collectively foolish, leading to a

downward spiral. A lot of the responsibility for countering this

rests on the bank of England, to relax monetary policy, but

government can also act. We can use Chris Huhne's Green Deal to

generate 100,000 jobs, we can leverage private investment through

the growth fund and the Greenpeace Investment bank. We can allow

councils to use planning permission, using the permissions for social

housing.. We can step up investment in our clapped out infrastructure.

There are tens of billions of pounds of British savings in

pension funds and insurance companies ready to invest in

transport, energy, broadband and housing if the regulators can

ensure a reasonable, mot raid return. As Danny announced

yesterday, the the Government is putting serious money behind local

infrastructure, but even with a stimulus to support the recovery,

the next few years will be difficult.

Living standards are being squeezed by continued high imported

inflation. The painful truth is that Britain is now a poorer

country as a result of the financial crash.

The public will only accept continuing us stairity if it is

seen to be fair. Yet there is currently a great sense of

grievance that the workers and the pensioners are paying the penalty

for a crisis that they did not create.

APPLAUSE And I want a real sense of

solidarity. That does not mean that we go around in green bowler hats

carrying suitcases, but we have as a party made clear our priorities

for continuing to lift lower than average earners out of tax and the

wealthy must pay their share. What the Liberal Democrats should focus

on are the vast disparrities of wealth. Much of it in inflated

property and land price, artificially generated by the boom

of the last decade. A few weeks ago a house changed hands for �140

million. One newspaper headline said without

a sense of irony, "Oligarchs are being priced out of Central London"

Yet the owners pay no more tax than men of -- many of the occupants of

a family semi-. When some critics attack our party policy on a tax on

properties over �million, you have to wonder what part much the solar

system they live in, but let me be clear, there is absolutely nothing

wrong with generous rewards for those who build up successful

businesses. For those who create wealth and

People accept capitalism, but what they want is responsible capitalism.

As for irspibl capitalism, some of you may have noticed that one of

the big media companies has recently had a spot of bother! I

think that you know who I'm referring to. All I would say about

it is this: The Labour Party, the Conservatives, even the Scottish

nationalists spent years queuing up to pay them homage. What makes me

proud of our party is that we never compromised oifs in that way.

APPLAUSE -- come promisised ourselves in

that way. APPLAUSE

What I want to do is to strengthen the best of British business.

I have taken two initiatives in particular. I have asked Professor

John Kay, together with Sir John Rose, the former boss of Rolls-

Royce. They have commitment to long-term investment, training, R

and D. I have asked them to look at how we make our stock markets and

institutional investors get out of this short-term speculative mind

frame. I am separately consulting on how best to tackle the

escalation of executive pay. Which in many cases have lost connection

with the value of shares, let alone average employee pay.

APPLAUSE It is very hard to explain why

share holders can vote to cut top pay, that the managers then ignore

the vote. Surely pay should be transparent and not hidden from

share holders and the public? So, I want to call time on payouts for

failure. APPLAUSE

Let me... Let me just say in conclusion, that when my staff saw

my draft of this speech, they said that they could see the grey sky,

but where are the sunny uplands? I have to say that I'm sorry, but I

can only tell it as asee it. I think that people are not

projecting ten years ahead when they are worrying about how to

survive the next ten days to their pay day, but I do sense a deeper

truth, that the public is tired of being lied to by politicians and

promised what cannot be delivered. The truth is that there are

difficult times ahead. Britain's post-war pattern of ever rising

living standards has been broken by the financial collapse. But I

believe that we can turn the economy around and we will.

In the coalition agreement we promised to put fairness at the

heart of all that we do. As we rebuild our broken economy

from the rubble, the Liberal Democrats know that you can't do

one without the other. So we must now do both, fairness and recovery.

Thank you. APPLAUSE

Nick Clegg getting on to his feet there to give Vince Cable a

standing ovation. A rather more low-key Vince Cable than some

expected. He attacked the Tory supplysiders with the low rate of

tax. Attacking yet again the banks, calling for a stimulus, although

not clear if this was to be a new stimulus. He went through a range

of existing policies. He is slightly constrained as it is the

policy of the coalition not to have further stimulus in the sense of

new money. He attacked the ideological descendents of those

who sent children up chimneys, though he did not say who they were.

He also called as had been trailed in the papers and the broadcasts

this morning for greater controls on executive pay, but all that he

announced was an investigation to be led by the former chief

executive of Rolls-Royce into how stock markets and institutional

investors can get away from the speculation, so that it highly

likely to be that radical and he is consultanting about what to do on

executive pay. So I suspect in the boardrooms of the City of London up

and down the country, they are breathing a little sigh of relief.

Let's find out from the head of the Institute of Directors, Templeton,

he has been listening to the speech in London. What did you make of it

Miles Templeman? It was like you, it was much milder than we were

expecting. Much we agreed with. The emphasis on growth, on planning

liberalisation, and infrastructure. So those things are key to growth.

I was glad, apart from the bashing of the banks again that he kept off,

largely, the whole issue of executive pay.

So, you are not frightened? He has not frightened the horses by what

he said on executive pay? It was strongly billed but in your view

turned out to be pretty much milk and water? I think that is as it

should be. It is not the issue that we should be talking about now. We

know that the share hold verse a responsibility. That is in place.

It is increasingly transparent what is happening. I think that is

improving. We are on that track. What we don't need is anything

further. Could you answer the question that

Chris Huhne seemed to have difficulty in answering to me a few

minutes ago, what in your view has Vince Cable done for business?

thought it was a good question. I think he said one or two things, on

a presentships they have been goofpltd we support that. The

planning on regulation -- the planning on infrastructure. The

regulation, we have not had progress, but a lot of fine words.

I think that the enterprise zone is a good one, but will it be

effective? We will wait and see. There are some areas, but not a lot

of progress yet,ual it is a difficult environment. Do you think

he was re fefring to you or the Institute of Directors as the

ideological descendents of those who want to send children up

chimneys? I don't know who. He did not follow through on it at all any

way. No. I think what we need from him is a much stronger voice

supporting business. We don't need the problems in business, but the

support. We need that internationally as well as at home.

He is doing that. Do you think that Vince Cable is

that strong voice? He's got to be, otherwise we never get the inward

investment. Is he? Well, the less he talks about bashing banks and

executive pay, the better. Miles Templeman, thank you very

much. Now, it is a hard life here at

party conferences, I'm sure you realise that. Not only do we wade

through countless fringe events, endless drinks receptions it is our

duty to go and to get our heads around the impenetrable language

that the political parties like to use on these occasions, but never

fear, in the first of our series of conference jargon busters, who are

you going to call? The Daily Politics and Andrew Dilnot, our own

dictionary, he's been out and about in Birmingham, looking at the

powers of the Lib Dem conference. Of all of the party conferences,

the Lib Dem seas arguably the most powerful. The conference is the

sovereign body of the party. It is responsible for making policy and

all policy flows from it. Not always a source of comfort to

the leadership, however, not everything voted on in conference

actually make it is into an There is part of the party will

have suggested things they want to discuss, and they pass that on to

the federal committee, who choose which ones will be debated at

conference, and then members will get to vote on them and turn them

into policy. Oh, yeah, how do they vote? Each member is issued with a

voting card that comes with their conference pass. That allows them

to take part in the full debates, which I chaired by the President of

the party or his representatives. He or she have the final say in any

decision. That was Giles Dilnot. With me now

part two MPs July overtaking notes, Duncan Hames and Tessa Munt. What

is the point of a Liberal Democrat conference that might it is a good

time to get together, to recharge our batteries. You are in a

coalition with no power to implement what to discuss. Are you

sure? To anyone policy that you have passed this week that will be

adopted by the coalition. -- Tell Me one policy. In March, as a

result of the demands we wanted to the health reforms, conference

flexed its muscles, and we have seen the impact of that in

legislation. What have you done this week? We have had the

discussion about having a response to looking at drugs and the problem

of drugs that inflicts massive damage on all of our communities. I

know it is a very unpopular topic, but it is what we have called for,

a structured and proper look at the impact. I listened to parts of the

debate. Do think the government will adopt it? We have to ask, and

we will see. We will have a go, won't we? Would you hold your

breath for it? We have got to do something, we cannot ignore the

problem any longer. Isn't there a danger that your conference is

becoming more like the Labour and Conservative conferences, which

over the years have a bath into rallies? Well, I guess your viewers

can judge that over the next couple of weeks. I think they will say

that Liberal Democrat conference has been different to the

conferences they will see in the next couple of weeks, which are

dominated by the platform. What is the mood of this conference?

think it is a slightly different one from normal, been at perhaps

when we met back in March, people were still slightly shell-shocked

about the fact that we were in power. What has happened in his

last little while is that, having recovered from the damage that we

were inflicted in May, what has happened now... In what way have

you recovered? Q and n% in the polls. I do not mean in polling

terms. What we have got is an opportunity to actually rebuild our

thoughts, think about the impact policies. What has changed is that

we have grown up a little bit, I think. That is what power has done.

I think it probably has. Are you growing up? We certainly have to

leave quite a lot of old habits behind. We need to roll our sleeves

and concentrate on making a difference, rather than talking

about a vision for what might be, instead making sure that it happens.

Do you want to change the rules of conference? Does it need to be

modernised? Does it needs to be more dynamic, interesting? No.

think it was pretty interesting when the issue that was of great

concern to the whole country was being discussed at our last Lib Dem

Conference... You are back in March again! This is now set them up.

This was an experience we never had in opposition, and I'm sure we'll

have other debates like that again. I think that has reinvigorated Lib

Dem Conference, to know that the debates here can make a difference

in government Airway that they never could before. Is it true that

he will miss the speech are your great leader? I am all start house

that you do such a thing? It is just a one-off. Is it true that you

are going on your honeymoon? That is right, yes. Isn't Birmingham

enough of a honeymoon for any Lib Dem? An old liberal city, a fine

tradition. Where could you go that could better Birmingham? It is

certainly a great prelude to my honeymoon to have spent his time at

conference. Where are you going? That's is a state secret, Andrew.

thought you believed in transparency! A bit of privacy as

well. You're also marrying a Theroux -- fellow anti-. I have

already married there. I did not get an invite! So you donate the

honeymoon did go on to Birmingham, is that what happened? -- delayed.

We manage to come to conference, but I figured that while the other

parties are having their conferences, that is when we will

be leased list. We be taking the lead Dem manifesto or the Orange

Book on honeymoon? I think we might Stop you might think the Liberal

Democrats are a soft and cuddly party, but we know differently.

They are turning nasty. The knives are out, and not just towards

Labour, they barely mention in these days. They are having a go at

The our coalition partners are sometimes helpful. I thought of

asking George Osborne for some jokes for his speech, as he knows a

lot about gags. They get worse! But I did not want to get up his nose

about it. I thought I went to queue for too long tonight, because I

want to get back to my hotel room to watch Strictly. Do you watch it?

Coming back to George Osborne, I heard that he is keen to get on a

show as well. He wants to do a line dance. It probably damages my

efforts as getting anything through the court ever again. But never

mind. I'm afraid divorce is inevitable, so has your President I

took the liberty of seeking legal advice about how we stand any event

of a World Cup, and there is good news and bad news. Good news, we

might get half of Ashcroft's money. Bad news, we have to have Eric

Pickles at the weekends. With me now, the Foreign Office

minister Jeremy Browne. Welcome to the Daily Politics. That afternoon.

Does all this Tory bashing get your pulse racing? I think he expected

at the party conference, no doubt there will be some Lib Dem bashing

at the Labour and Conservative conferences as of. I let it wash

over me. You are not going to be embarrassed when you next bargain

to thought Tory boss at the Foreign Office. No, I don't think I will. I

have missed what you call Tory machine. Really? It has been hard

to avoid. I think all party conferences, as long as I have been

going to them, have had people taking a knock at the other two

parties, and all three parties did, and probably the public do not

respond well, but sometimes the party faithful quite enjoy it and

it raises their spirits. But why are you bashing the Tories more

than Labour? I do not know if we are. Oh, yes, you are! I suppose

there might be concern in some quarters that we do not appear to

have lost our distinctiveness, and maybe people feel there is an

audience for showing that we are different in spirit from the

Conservatives, but I think is pretty peripheral to what is

happening at a conference as a whole. The Secretary of the 1922

Committee of backbenchers, Mark Pritchard, once a vote on Britain's

membership of the European Union. - - once. That was in your Lib Dem

manifesto last year, so presumably you are in favour of that. I do not

think it end -- it is anything that is likely to happen soon, and the

Prime Minister has said that, at Mark Pritchard, a perfectly

reasonable MP, the needs to raise that with the leader of his own

party, I think. But it was in your manifesto, I will read out the

words. The European Union has evolved significantly since the

last public vote on membership over 30 years ago, 1975, when we voted

to stay in. The Liberal Democrats remain committed therefore to a

referendum. We had the coalition agreement that was forged in the

days after the general election, and there was no commitment to a

referendum on Britain's membership of the European Union. So it is not

party policy any more. When the Prime Minister and the Deputy Prime

Minister feel that is a necessary measure to take, then no doubt it

will be taken, but it isn't anything that is being contemplated

at this stage. To be honest, if you look at what is happening in Greece

and other countries in the eurozone, a referendum on Britain's

membership is not the number one issue with regard to Europe at the

moment. What actually matters most in Europe is whether the currency

which many countries in the European Union belong to is going

to go even further into crisis, and that is what is preoccupying people.

So should we filed his promise in your manifesto alongside tuition

fees as not worth the paper it was written on? -- should we file this

promise. Let me put it this way. I was born in May 1970, and we abide

many general elections since then. -- we have had. No Lib Dem

manifesto commitments implemented that any of those general elections.

2010, three quarters of our manifesto commitments implemented

in government. It is an amazing achievement for a party that only

as 8% of the seats in the House of Commons, we are in coalition with

the Conservatives in the national interest because no party won the

general election. No party has a mandate to implement this party

manifesto in full, but for the first time in my grandparents

lifetime we are implementing large parts of our manifesto. People who

have voted Lib Dem for decades in the Wilders years have reasons to

be ecstatic that their vote now cancels and they -- that their vote

now counts for something. Would it make sense that Britain would

prosper if it loosened its ties with the EU? Our relationship with

the EU is in the agreement that the parties arrived at after the last

general election, and we are working very constructively, the

government as a whole, within the European Union, and I can give you

a couple of examples. We have just signed a free-trade agreement with

South Korea, a country I have responsibility for within the

Foreign Office. That is a great success. We are co-ordinating

policy across the European Union with regards to Syria. I think that

is an important shed bit of policy. Two good examples, but what is the

answer to my question? Would we prosper if we loosened our ties

with the EU, as William Hague has claimed? The point and making is

that the government has a settled position on the EU, and in practice

on a day-to-day basis we are working very constructively with

the other members of the European Union to deliver British objectives.

Tim Farron, the President of your party, says that the government,

this current government, would be an absolute nightmare without Lib

Dem ministers. Is he right? It is a hypothetical question, because no

party won the last general election, so we have a coalition as a result

of the British people deciding that no party decided to govern alone.

The British people came to the conclusion that they did not want

any party to be in government implementing its manifesto in its

entirety on their own. So it does not sound like you agree with the

phrase absolute nightmare. They, as a result, have given as a situation

where we needed to forge a coalition, and that is what we have

done. If I wanted to join the Conservative Party, if I wanted to

implement Conservative Party policies, I could have done that. I

did not do that, I joined the Liberal Democrats, and I'm proud of

the contribution they are making to government, but we finished third

in the general election. We do not deserve to govern outright or on

our own, we did not win a mandate. We are in collision with the

Conservatives, and lover of making every effort to put the country

back on a street. Would you like a badger that says don't panic Quetta

mark what are the other options? I love tax cuts, I love the euro.

Would you like that? No. I love nuclear power. Love is a bit strong.

How about I love the coalition? think that reflects the mood are

all hard-headed people. That is it for today. We are back tomorrow at