Conference Special Daily Politics


Conference Special

Andrew Neil is in Birmingham for the Liberal Democrat's annual conference. Danny Alexander discusses the deficit reduction plan. Plus Vince Cable's conference speech live.


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Afternoon, folks, welcome to this Daily Politics conference special

:00:25.:00:30.

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

:00:30.:00:34.

against the rich, the Tories, their partners.

:00:34.:00:38.

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

:00:38.:00:43.

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

:00:43.:00:48.

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

:00:48.:00:54.

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

:00:54.:01:01.

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

:01:01.:01:04.

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

:01:04.:01:10.

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

:01:10.:01:14.

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

:01:14.:01:20.

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

:01:20.:01:24.

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

:01:24.:01:31.

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

:01:31.:01:34.

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

:01:34.:01:44.
:01:44.:01:45.

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

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

:01:49.:01:54.

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

:01:54.:01:58.

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

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

:02:02.:02:06.

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

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

:02:11.:02:17.

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

:02:17.:02:22.

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

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

:02:26.:02:31.

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

:02:31.:02:34.

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

:02:34.:02:38.

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

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as black as they are sometimes painted.

:02:41.:02:46.

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

:02:46.:02:51.

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

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

:02:56.:03:01.

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

:03:01.:03:06.

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

:03:06.:03:10.

have experienced sick kl growth, but the underlying structural

:03:10.:03:14.

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

:03:14.:03:17.

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

:03:17.:03:22.

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

:03:22.:03:27.

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

:03:27.:03:30.

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

:03:30.:03:36.

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

:03:36.:03:45.

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

:03:45.:03:49.

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

:03:49.:03:53.

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

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

:03:57.:04:01.

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

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

:04:05.:04:08.

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

:04:08.:04:13.

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

:04:13.:04:18.

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

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

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

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

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the problems that many countries are facing. Looking around the

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

:04:40.:04:44.

right decisions. Looking to the United States, their

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

:04:49.:04:52.

Having political leaders who take difficult decisions and sticking to

:04:52.:04:55.

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

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

:05:00.:05:04.

rank and file? Have you reservations about being in bed

:05:04.:05:09.

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

:05:09.:05:12.

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

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

:05:17.:05:22.

partners have worked together rather more co-operatively than

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imagine that they may have at one point.

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That they could have been scratching their eyes out? That

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

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

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

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Four months away in a terrible local election results in the

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defeat of the alternative vote referendum, Nick Clegg must have

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

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

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even angry about being in bed with the Tories.

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

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

:06:17.:06:21.

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

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

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

:06:29.:06:35.

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

:06:35.:06:39.

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

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

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raised from the richer people through the mansion tax and the

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

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

:07:01.:07:07.

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

:07:07.:07:11.

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

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

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

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

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

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me inside government. It is an artificial construct.

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

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cheer the troops along it is depressing that the coalition

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

:07:46.:07:49.

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

:07:49.:07:53.

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

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

:07:57.:08:01.

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

:08:01.:08:05.

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

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

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

:08:14.:08:18.

enSecretary of State yourselves from the Conservatives, but they

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

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

:08:26.:08:30.

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

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

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

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

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anything for the growth and the expansion of the private sector

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

:08:56.:08:57.

British business, rather than making it difficult.

:08:57.:09:07.
:09:07.:09:08.

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

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

:09:15.:09:18.

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

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floor. The fundamental liberal principles

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

:09:30.:09:36.

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

:09:36.:09:41.

principles of accountability and transparency. We do not tolerate

:09:41.:09:44.

unethical behaviour from other professional groups that hold great

:09:44.:09:47.

responsibility, we must not tolerate it from our journalists.

:09:47.:09:52.

Freedom and accountability are not incompatible. So this motion

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

:09:58.:10:01.

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

:10:01.:10:07.

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

:10:07.:10:12.

effective. We need policies like restore tiv justice that prevent

:10:12.:10:19.

reoffending rather than draconian sentences being passed because

:10:19.:10:23.

magistrates and judges come under political pressure.

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

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

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

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

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

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

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

:10:58.:11:00.

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

:11:00.:11:04.

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

:11:04.:11:09.

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

:11:09.:11:15.

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

:11:15.:11:21.

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

:11:21.:11:27.

have been difficult in failing to compromise in the budget over

:11:27.:11:34.

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

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

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

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

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

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began when the Greek Government did not present accounts which were

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

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

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

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No other country has actually falsified its national accounts in

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

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

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

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

:12:43.:12:47.

wriggle room, but the Greek Government presented figures that

:12:47.:12:51.

the current Government found out about at the election that were

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

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really outrageous. OK. You follow these things closely.

:13:00.:13:08.

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

:13:08.:13:13.

ever inevitable. Is it likely? In the current

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

:13:17.:13:21.

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

:13:21.:13:24.

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

:13:24.:13:29.

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

:13:29.:13:32.

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

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

:13:39.:13:44.

who had more than their entire capital reserves outstanding, even

:13:44.:13:49.

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

:13:49.:13:53.

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

:13:54.:14:00.

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

:14:00.:14:03.

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

:14:03.:14:13.
:14:13.:14:30.

My hunch would be that we have underestimated the political will

:14:30.:14:35.

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

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

:14:39.:14:44.

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

:14:44.:14:48.

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

:14:48.:14:51.

The Financial Times this morning has done calculations, using the

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same methodology as the Government, and has discovered that the

:14:55.:15:00.

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

:15:00.:15:02.

actually �12 billion higher than the government calculated. Does

:15:02.:15:07.

that mean there will have to be more austerity measures?

:15:07.:15:13.

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

:15:13.:15:16.

well-established and reputable authoritative international

:15:16.:15:23.

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

:15:23.:15:28.

serious calculations of the structural balance. They know that

:15:28.:15:31.

different methodologies to the Treasury. I think that is more

:15:31.:15:35.

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

:15:35.:15:39.

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

:15:39.:15:42.

in place a framework with the Office for Budget Responsibility,

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

:15:46.:15:51.

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

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

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

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

:16:06.:16:08.

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

:16:08.:16:13.

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

:16:13.:16:17.

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

:16:17.:16:20.

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

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

:16:26.:16:29.

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

:16:29.:16:34.

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

:16:34.:16:39.

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

:16:39.:16:42.

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

:16:42.:16:47.

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

:16:47.:16:50.

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

:16:50.:16:57.

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

:16:57.:17:01.

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

:17:02.:17:05.

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

:17:06.:17:10.

zone because our commitment to incredible physical programme.

:17:10.:17:14.

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

:17:15.:17:18.

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

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

:17:22.:17:26.

reacting to something that appears in newspapers, no matter how

:17:26.:17:30.

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

:17:30.:17:35.

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

:17:35.:17:39.

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

:17:39.:17:42.

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

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

:17:47.:17:53.

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

:17:53.:17:58.

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

:17:58.:18:03.

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

:18:03.:18:11.

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

:18:11.:18:14.

the Secretary for Energy and climate change. The singers beggars

:18:14.:18:17.

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

:18:17.:18:22.

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

:18:22.:18:27.

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

:18:27.:18:32.

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

:18:32.:18:36.

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

:18:36.:18:41.

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

:18:41.:18:46.

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

:18:46.:18:54.

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

:18:54.:18:57.

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

:18:57.:19:01.

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

:19:01.:19:05.

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

:19:05.:19:08.

when we are really trying to encourage growth, stimulating

:19:08.:19:13.

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

:19:13.:19:19.

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

:19:19.:19:25.

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

:19:25.:19:29.

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

:19:29.:19:33.

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

:19:33.:19:39.

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

:19:39.:19:45.

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

:19:45.:19:50.

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

:19:50.:19:56.

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

:19:56.:20:02.

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

:20:02.:20:07.

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

:20:07.:20:10.

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

:20:11.:20:14.

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

:20:14.:20:18.

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

:20:18.:20:21.

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

:20:21.:20:25.

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

:20:25.:20:29.

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

:20:29.:20:33.

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

:20:33.:20:39.

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

:20:39.:20:42.

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

:20:42.:20:45.

conference rhetoric, because it is not something that would help

:20:46.:20:50.

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

:20:50.:20:54.

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

:20:54.:21:00.

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

:21:00.:21:08.

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

:21:08.:21:11.

Attlee and Aaron Bevan, working with their Tory opponents,

:21:11.:21:18.

Churchill and Beaverbrook, setting aside their political differences

:21:18.:21:22.

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

:21:22.:21:29.

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

:21:29.:21:35.

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

:21:35.:21:41.

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

:21:41.:21:48.

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

:21:48.:21:53.

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

:21:53.:22:00.

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

:22:00.:22:06.

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

:22:06.:22:10.

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

:22:10.:22:18.

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

:22:18.:22:23.

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

:22:23.:22:27.

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

:22:27.:22:33.

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

:22:33.:22:40.

inflated property bubble. It encouraged bloated banking, while

:22:40.:22:45.

manufacturing declined at an unprecedented right. And then they

:22:45.:22:48.

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

:22:48.:22:55.

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

:22:56.:23:00.

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

:23:00.:23:05.

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

:23:05.:23:12.

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

:23:12.:23:17.

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

:23:17.:23:27.
:23:27.:23:37.

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

:23:37.:23:44.

required courage from our party to withstand the tribalism which is

:23:44.:23:47.

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

:23:47.:23:51.

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

:23:51.:23:55.

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

:23:55.:24:01.

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

:24:01.:24:06.

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

:24:06.:24:11.

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

:24:11.:24:18.

to acknowledge David Willetts and our own outstanding minister Ed

:24:18.:24:26.

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

:24:26.:24:30.

but we are now helping recovery. We are greatly expanded

:24:31.:24:34.

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

:24:34.:24:39.

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

:24:39.:24:44.

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

:24:44.:24:47.

Technology Innovation centres promoting the technologies of the

:24:47.:24:51.

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

:24:51.:24:57.

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

:24:57.:25:02.

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

:25:02.:25:06.

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

:25:06.:25:10.

Conservative and Labour governments failed to do, legislate for the

:25:10.:25:15.

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

:25:15.:25:21.

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

:25:21.:25:27.

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

:25:27.:25:32.

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

:25:32.:25:36.

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

:25:36.:25:40.

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

:25:40.:25:46.

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

:25:46.:25:56.
:25:56.:26:02.

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

:26:02.:26:12.
:26:12.:26:15.

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

:26:16.:26:21.

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

:26:21.:26:28.

priorities, stability, stimulus, solidarity. Stability in the

:26:28.:26:33.

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

:26:33.:26:37.

to support growth, and that sustainable growth based on

:26:37.:26:43.

business investment, exports, green technology and manufacturing. And

:26:44.:26:50.

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

:26:50.:26:55.

appalling inequalities of income and wealth, and creating a

:26:55.:27:00.

responsible capitalism. Let me start with stability. The last

:27:00.:27:05.

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

:27:05.:27:11.

it left us a dangerous, unsustainable budget deficit. And

:27:11.:27:17.

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

:27:18.:27:24.

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

:27:24.:27:28.

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

:27:28.:27:35.

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

:27:35.:27:39.

discipline is not ideological, it is a necessary condition for

:27:39.:27:46.

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

:27:46.:27:52.

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

:27:52.:27:57.

the Canadian Liberals, Scandinavian Social Democrats, the Clinton

:27:57.:28:02.

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

:28:02.:28:07.

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

:28:07.:28:17.
:28:17.:28:23.

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

:28:23.:28:27.

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

:28:27.:28:32.

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

:28:32.:28:37.

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

:28:37.:28:41.

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

:28:41.:28:47.

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

:28:47.:28:50.

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

:28:51.:28:55.

will miraculously appear. And I think the reasoning is something

:28:55.:29:00.

like this, all those British billionaires who demonstrate their

:29:00.:29:05.

patriotism by hiding from the taxman in Monaco for some Caribbean

:29:05.:29:10.

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

:29:10.:29:20.
:29:20.:29:23.

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

:29:23.:29:29.

about the Government's deficit. Massive potential instability is

:29:29.:29:35.

caused by British-based global banks whose combined assets are

:29:35.:29:41.

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

:29:41.:29:47.

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

:29:47.:29:53.

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

:29:53.:29:58.

the taxpayer pays. And the Independent Banking Commission, the

:29:58.:30:03.

Vickers commission, provides a means to stop this dangerous

:30:03.:30:09.

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

:30:09.:30:12.

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

:30:12.:30:22.
:30:22.:30:28.

start soon, and it will be APPLAUSE.

:30:28.:30:34.

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

:30:34.:30:41.

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

:30:41.:30:45.

institutions, exposing taxpayers to the risk of exploding financial

:30:45.:30:52.

weapons of mass destruction. APPLAUSE.

:30:52.:30:57.

But the banks must also perform their basic economic function.

:30:57.:31:03.

Which is channeling our savings, into productive investment.

:31:03.:31:07.

They are doing so. Productive British business and banking are

:31:07.:31:13.

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

:31:13.:31:16.

either wears his trousers around his chest stifling breathing, which

:31:16.:31:23.

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

:31:23.:31:30.

assets. APPLAUSE

:31:30.:31:38.

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

:31:39.:31:44.

Steady lending growth, especially to protective British businesses,

:31:44.:31:49.

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

:31:49.:31:55.

and famine in bank lending. APPLAUSE

:31:55.:32:00.

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

:32:00.:32:04.

from financial stability to growth? -- progress from financial

:32:05.:32:08.

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

:32:08.:32:13.

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

:32:13.:32:16.

businesses. That means promoting British

:32:16.:32:19.

commerce in the big emerging markets that have been neglected in

:32:19.:32:23.

the past. It means keeping Britain open to

:32:23.:32:27.

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

:32:27.:32:33.

It means cutting red tape which is suffocating growing companies which

:32:33.:32:39.

create jobs. Well, I I will not provide cover

:32:39.:32:46.

for the ideological deendents of those who once sent children up

:32:46.:32:50.

chimneys. Panic in financial markets will not be stopped by

:32:50.:32:57.

scrapping maternity rights. APPLAUSE

:32:57.:33:03.

But the immediate threat is lack of demand.

:33:03.:33:09.

With consumers, companies and governments cutting spending, there

:33:09.:33:15.

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

:33:16.:33:23.

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

:33:23.:33:27.

downward spiral. A lot of the responsibility for countering this

:33:27.:33:32.

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

:33:32.:33:39.

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

:33:39.:33:44.

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

:33:44.:33:49.

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

:33:49.:33:54.

councils to use planning permission, using the permissions for social

:33:54.:33:58.

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

:33:58.:34:02.

There are tens of billions of pounds of British savings in

:34:02.:34:05.

pension funds and insurance companies ready to invest in

:34:05.:34:11.

transport, energy, broadband and housing if the regulators can

:34:11.:34:15.

ensure a reasonable, mot raid return. As Danny announced

:34:15.:34:20.

yesterday, the the Government is putting serious money behind local

:34:20.:34:24.

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

:34:24.:34:28.

the next few years will be difficult.

:34:28.:34:34.

Living standards are being squeezed by continued high imported

:34:34.:34:38.

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

:34:38.:34:43.

country as a result of the financial crash.

:34:43.:34:48.

The public will only accept continuing us stairity if it is

:34:48.:34:54.

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

:34:54.:34:58.

grievance that the workers and the pensioners are paying the penalty

:34:58.:35:02.

for a crisis that they did not create.

:35:02.:35:12.
:35:12.:35:13.

APPLAUSE And I want a real sense of

:35:13.:35:23.
:35:23.:35:30.

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

:35:30.:35:35.

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

:35:35.:35:40.

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

:35:40.:35:43.

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

:35:43.:35:49.

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

:35:49.:35:52.

property and land price, artificially generated by the boom

:35:52.:35:59.

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

:35:59.:36:04.

million. One newspaper headline said without

:36:04.:36:14.
:36:14.:36:15.

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

:36:15.:36:22.

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

:36:22.:36:28.

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

:36:28.:36:34.

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

:36:34.:36:39.

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

:36:39.:36:44.

wrong with generous rewards for those who build up successful

:36:44.:36:47.

businesses. For those who create wealth and

:36:47.:36:57.
:36:57.:37:06.

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

:37:06.:37:12.

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

:37:12.:37:17.

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

:37:17.:37:21.

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

:37:21.:37:27.

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

:37:27.:37:32.

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

:37:32.:37:38.

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

:37:38.:37:42.

APPLAUSE -- come promisised ourselves in

:37:42.:37:52.

that way. APPLAUSE

:37:52.:37:58.

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

:37:58.:38:03.

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

:38:03.:38:11.

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

:38:11.:38:15.

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

:38:15.:38:22.

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

:38:22.:38:27.

institutional investors get out of this short-term speculative mind

:38:27.:38:32.

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

:38:32.:38:36.

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

:38:36.:38:41.

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

:38:41.:38:49.

APPLAUSE It is very hard to explain why

:38:49.:38:55.

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

:38:55.:39:00.

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

:39:00.:39:06.

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

:39:06.:39:11.

failure. APPLAUSE

:39:11.:39:17.

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

:39:17.:39:24.

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

:39:24.:39:29.

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

:39:29.:39:34.

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

:39:34.:39:37.

projecting ten years ahead when they are worrying about how to

:39:37.:39:42.

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

:39:42.:39:47.

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

:39:47.:39:57.

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

:39:57.:39:58.

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

:39:58.:40:04.

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

:40:05.:40:09.

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

:40:09.:40:13.

In the coalition agreement we promised to put fairness at the

:40:13.:40:19.

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

:40:19.:40:24.

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

:40:24.:40:31.

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

:40:31.:40:41.
:40:41.:40:42.

Thank you. APPLAUSE

:40:42.:40:47.

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

:40:47.:40:53.

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

:40:53.:40:59.

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

:40:59.:41:04.

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

:41:04.:41:09.

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

:41:09.:41:12.

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

:41:12.:41:17.

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

:41:17.:41:23.

new money. He attacked the ideological descendents of those

:41:23.:41:28.

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

:41:28.:41:31.

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

:41:31.:41:36.

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

:41:36.:41:41.

announced was an investigation to be led by the former chief

:41:41.:41:44.

executive of Rolls-Royce into how stock markets and institutional

:41:44.:41:49.

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

:41:49.:41:53.

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

:41:53.:41:57.

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

:41:57.:42:00.

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

:42:00.:42:04.

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

:42:04.:42:08.

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

:42:08.:42:13.

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

:42:13.:42:19.

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

:42:20.:42:24.

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

:42:24.:42:29.

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

:42:29.:42:32.

largely, the whole issue of executive pay.

:42:32.:42:36.

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

:42:37.:42:42.

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

:42:42.:42:46.

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

:42:46.:42:51.

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

:42:51.:42:54.

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

:42:55.:42:59.

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

:42:59.:43:03.

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

:43:03.:43:06.

further. Could you answer the question that

:43:06.:43:09.

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

:43:09.:43:14.

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

:43:14.:43:21.

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

:43:21.:43:26.

a presentships they have been goofpltd we support that. The

:43:26.:43:29.

planning on regulation -- the planning on infrastructure. The

:43:29.:43:34.

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

:43:34.:43:38.

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

:43:38.:43:43.

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

:43:43.:43:47.

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

:43:47.:43:52.

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

:43:52.:43:57.

ideological descendents of those who want to send children up

:43:57.:44:00.

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

:44:01.:44:06.

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

:44:06.:44:10.

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

:44:10.:44:13.

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

:44:13.:44:17.

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

:44:17.:44:23.

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

:44:23.:44:28.

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

:44:28.:44:31.

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

:44:31.:44:35.

much. Now, it is a hard life here at

:44:35.:44:39.

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

:44:39.:44:43.

through countless fringe events, endless drinks receptions it is our

:44:43.:44:48.

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

:44:48.:44:53.

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

:44:53.:44:59.

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

:44:59.:45:06.

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

:45:06.:45:10.

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

:45:10.:45:17.

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

:45:17.:45:24.

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

:45:24.:45:28.

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

:45:28.:45:33.

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

:45:33.:45:37.

the leadership, however, not everything voted on in conference

:45:37.:45:47.
:45:47.:45:49.

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

:45:49.:45:53.

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

:45:53.:45:56.

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

:45:56.:45:59.

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

:45:59.:46:04.

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

:46:04.:46:07.

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

:46:07.:46:13.

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

:46:13.:46:17.

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

:46:17.:46:23.

decision. That was Giles Dilnot. With me now

:46:23.:46:29.

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

:46:29.:46:34.

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

:46:34.:46:41.

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

:46:41.:46:44.

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

:46:44.:46:48.

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

:46:48.:46:54.

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

:46:54.:47:00.

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

:47:00.:47:03.

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

:47:03.:47:07.

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

:47:07.:47:12.

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

:47:12.:47:15.

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

:47:15.:47:21.

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

:47:21.:47:25.

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

:47:25.:47:28.

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

:47:28.:47:32.

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

:47:32.:47:36.

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

:47:36.:47:40.

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

:47:40.:47:44.

becoming more like the Labour and Conservative conferences, which

:47:44.:47:49.

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

:47:49.:47:53.

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

:47:53.:47:55.

that Liberal Democrat conference has been different to the

:47:55.:47:58.

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

:47:58.:48:02.

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

:48:02.:48:06.

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

:48:06.:48:09.

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

:48:10.:48:13.

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

:48:13.:48:16.

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

:48:16.:48:21.

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

:48:21.:48:25.

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

:48:25.:48:32.

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

:48:32.:48:36.

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

:48:36.:48:41.

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

:48:41.:48:47.

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

:48:47.:48:51.

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

:48:51.:48:55.

and concentrate on making a difference, rather than talking

:48:55.:49:00.

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

:49:00.:49:04.

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

:49:04.:49:09.

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

:49:09.:49:13.

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

:49:13.:49:17.

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

:49:17.:49:22.

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

:49:22.:49:26.

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

:49:26.:49:30.

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

:49:30.:49:33.

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

:49:33.:49:36.

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

:49:36.:49:43.

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

:49:43.:49:50.

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

:49:50.:49:55.

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

:49:55.:49:59.

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

:49:59.:50:03.

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

:50:03.:50:07.

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

:50:07.:50:12.

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

:50:12.:50:15.

thought you believed in transparency! A bit of privacy as

:50:15.:50:22.

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

:50:22.:50:32.
:50:32.:50:33.

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

:50:33.:50:38.

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

:50:38.:50:41.

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

:50:41.:50:44.

parties are having their conferences, that is when we will

:50:44.:50:50.

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

:50:50.:51:00.
:51:00.:51:00.

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

:51:00.:51:03.

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

:51:03.:51:07.

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

:51:07.:51:11.

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

:51:11.:51:21.

The our coalition partners are sometimes helpful. I thought of

:51:21.:51:24.

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

:51:24.:51:33.

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

:51:33.:51:39.

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

:51:39.:51:44.

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

:51:44.:51:48.

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

:51:48.:51:55.

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

:51:55.:51:58.

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

:51:58.:52:05.

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

:52:05.:52:09.

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

:52:09.:52:12.

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

:52:12.:52:17.

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

:52:17.:52:25.

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

:52:25.:52:29.

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

:52:29.:52:34.

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

:52:34.:52:39.

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

:52:39.:52:43.

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

:52:43.:52:48.

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

:52:48.:52:54.

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

:52:54.:52:58.

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

:52:58.:53:03.

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

:53:04.:53:08.

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

:53:08.:53:13.

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

:53:13.:53:16.

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

:53:16.:53:20.

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

:53:20.:53:25.

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

:53:25.:53:28.

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

:53:28.:53:32.

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

:53:32.:53:35.

audience for showing that we are different in spirit from the

:53:35.:53:38.

Conservatives, but I think is pretty peripheral to what is

:53:38.:53:43.

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

:53:43.:53:48.

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

:53:48.:53:53.

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

:53:53.:53:56.

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

:53:56.:54:02.

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

:54:02.:54:05.

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

:54:05.:54:09.

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

:54:09.:54:13.

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

:54:13.:54:16.

words. The European Union has evolved significantly since the

:54:16.:54:22.

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

:54:22.:54:26.

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

:54:26.:54:31.

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

:54:31.:54:34.

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

:54:34.:54:38.

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

:54:38.:54:42.

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

:54:42.:54:46.

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

:54:46.:54:49.

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

:54:49.:54:53.

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

:54:53.:54:55.

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

:54:55.:54:59.

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

:54:59.:55:02.

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

:55:02.:55:06.

which many countries in the European Union belong to is going

:55:06.:55:11.

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

:55:12.:55:17.

So should we filed his promise in your manifesto alongside tuition

:55:17.:55:21.

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

:55:21.:55:28.

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

:55:28.:55:35.

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

:55:35.:55:41.

manifesto commitments implemented that any of those general elections.

:55:41.:55:43.

2010, three quarters of our manifesto commitments implemented

:55:43.:55:48.

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

:55:48.:55:52.

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

:55:52.:55:55.

the Conservatives in the national interest because no party won the

:55:55.:55:59.

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

:55:59.:56:03.

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

:56:03.:56:06.

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

:56:06.:56:10.

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

:56:10.:56:17.

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

:56:17.:56:21.

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

:56:21.:56:25.

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

:56:25.:56:29.

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

:56:29.:56:32.

general election, and we are working very constructively, the

:56:32.:56:36.

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

:56:36.:56:39.

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

:56:39.:56:43.

South Korea, a country I have responsibility for within the

:56:43.:56:46.

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

:56:46.:56:51.

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

:56:51.:56:57.

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

:56:57.:57:02.

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

:57:02.:57:05.

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

:57:06.:57:10.

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

:57:10.:57:13.

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

:57:13.:57:16.

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

:57:16.:57:20.

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

:57:20.:57:24.

this current government, would be an absolute nightmare without Lib

:57:24.:57:29.

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

:57:29.:57:33.

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

:57:33.:57:36.

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

:57:36.:57:39.

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

:57:39.:57:43.

any party to be in government implementing its manifesto in its

:57:43.:57:47.

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

:57:47.:57:51.

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

:57:51.:57:54.

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

:57:54.:57:59.

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

:57:59.:58:02.

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

:58:02.:58:06.

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

:58:06.:58:09.

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

:58:09.:58:12.

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

:58:13.:58:16.

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

:58:17.:58:19.

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

:58:19.:58:23.

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

:58:23.:58:30.

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

:58:30.:58:35.

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

:58:35.:58:42.

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

:58:42.:58:46.

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

:58:46.:58:49.

Andrew Neil is in Birmingham for the Liberal Democrat's annual conference.

They've had over a year of coalition government, but it hasn't been plain sailing sharing power with the Tories and some have invented the new sport of Tory bashing. We'll be talking about.

What's clear is Mr Clegg has an uphill struggle on his hands. The latest polls put the party at 11%. And over 60% of people have no idea what the Lib Dem leader stands for anymore.

It's clear though what the Business Secretary, Vince Cable thinks: he wants to curb boardroom pay. We'll be taking his address to conference live. And we'll be talking to the energy secretary Chris Huhne.

Andrew has been blogging about the conference - there's a link on our website, if you want to join in.

And if you missed his interview with Danny Alexander last night, it's on again at 1300 today on BBC Parliament - as we come off-air. Or you can watch it on the BBC iPlayer.


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