Conference Special: Part 1 Daily Politics


Conference Special: Part 1

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Afternoon, folks. The sun is out and the sky is blue and the

:00:29.:00:34.

economic backdrop is grim and getting grimmer. Maybe that is why

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the Lib Dems have voted to create a National Institute of well-being.

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For all of you cynics out there, -- before you scoff, I wanted to know

:00:45.:00:55.
:00:55.:01:25.

that I feel better already, even We will be talking to Danny

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Alexander. That is not all, because Jo is here in Birmingham as well,

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so it must be an important day. What a welcome. I am here as well,

:01:34.:01:38.

I will be looking back at what a turbulent year the Liberal

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Democrats have had. It has not been plain sailing for Nick Clegg. What

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with tuition fees, the a be a referendum and health. If you are a

:01:48.:01:52.

member of the party, you may not want to watch our review of the

:01:52.:02:02.
:02:02.:02:07.

year, a health warning for you. And Yes, all that coming up in the next

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hour of political pantomime. Sorry, I mean public service broadcasting

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at its finest. We have the former Chief Secretary to the Treasury,

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David Laws MP. Welcome back. How is life outside the cabinet? Not bad,

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I am a strong supporter of the coalition, -- government. What have

:02:29.:02:35.

you been up to? I have my job to do as a Member of Parliament and I am

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supporting the government involved in the parliamentary services bill.

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Sometimes you seem to be supporting the government more than some of

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the members of the government? not sure about that but I believe

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it is important that the Liberal Democrats should play a

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constructive role in the coalition. Sometimes we need to act as a

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breaker in particular areas. But our role in the coalition

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government is to be partners and to pursue a constructive partnership

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and make sure we get as much of foreign policy agenda implemented

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in government. I understand that, it is true of any party in a

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coalition. But constructive relationship, it hasn't exactly

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been the hallmark of speeches. Are you comfortable with this Tory

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bashing? I think the party has been trying to find the right balance in

:03:30.:03:34.

coalition, between making clear to the electorate that there is

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distinction between the Liberal Democrats, in the case of values

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and policies, many of them, but demonstrating something that the

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public were sceptical about in May 2010, that two parties with

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different traditions could work together. I think in the first year

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we got the balance wrong, the public felt we were not hearing

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enough from the Liberal Democrats - - they were not hearing enough. In

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the second year, we have tried to get the balance right and I am sure

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that we will do. The party has been trying to re-establish its identity,

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that is part of the motive for the Tory bashing. In most areas, your

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policy, the party's policy, is the policy of the coalition government.

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You haven't got a separate defence policy from the coalition

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government, or do you? We have our own policies as Liberal Democrats,

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but we have agreed with the Conservatives, a plan for coalition

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government. Sometimes a very big issues like tax, the Conservatives

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have made concessions, so we are delivering. You have not got

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policies in the main areas, because they are the combine compromised

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policies of the coalition. There is not a separate Lib Dem policy on

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growth, or is there? That is the nature of coalition, that you come

:04:55.:04:59.

together, and agree while you are governing together, to make those

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compromises. At the next general election, we will still have all of

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the parties competing between themselves with our own policy

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agendas. It will then be up to the public to decide which of those to

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support. The Lib Dems' policy for growth is the same as the

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coalition's, at the moment? That's right, we are working within the

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coalition government to make sure we have strong support for the

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deficit reduction strategy, that we were part of shipping, but to make

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sure, in a very challenging year for the whole of the developed

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world economy, that we are doing everything we can to support growth,

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which is critical to the deficit reduction strategy, and there is a

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lot we can do one grows. Why isn't it working -- on growth. We have

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had international developments that have been unfavourable. Oil prices

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going up 50%, food prices doubling, chaos in the eurozone, the US

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economy slowing down, the Japanese tsunami. All of those are

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international events, some of those we can help to correct in the

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future, we need to be working in the eurozone to sort out the

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problems. Some are outside the power of the British Government in

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the short term. We can obviously do things, and that debate is

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happening within the government at the current time, to support growth.

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I understand it is difficult time for everybody. The IMF poss

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downgrade of growth forecast was worse for us than for Europe or the

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United States, we are barely going to grow by 1%. So we are worse.

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next year, we are forecast to grow in line with all of the major

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developed economies. In fact, faster than a number of developed

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countries. But not this year? year we are forecast, and the other

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major economies are forecast to be growing in the 1%, to 1.5% zone, so

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all very similar. The problems we have in the United Kingdom are not

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some particular aspect of the way the government is conducting

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economic policies, they come as a consequence of international

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problems, including the very big squeeze on purchasing power,

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because of the rise in inflation due to the oil price and food price

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shocks. The IMF said it activity were to undershoot current

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expectations, and this is me, that is certainly true in Britain, you

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have undershot your growth forecasts, countries that face

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historically low yields, and that is also Britain, should also

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consider delaying some of their planned adjustments. In other words,

:07:40.:07:50.
:07:50.:07:50.

budget cuts. Why did you follow the IMF's and vice? -- advice.

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should be sticking with our deficit-reduction plan. It doesn't

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say that. That is what they have said clearly about Britain,

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yesterday and in all of their statements over the last few months.

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They have been absolutely clear they don't want us to change.

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page 79 of the World economic Outlook, they say that countries

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like Britain... They don't say if you have got a big deficit, you

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shouldn't... They are saying if you can borrow cheaply, you should

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consider delaying budget cuts. Why wouldn't you do that? They were

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asked this question about Britain yesterday and they made clear they

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support the existing strategy of the government. It is that strategy

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that is keeping interest rates low, helping businesses and mortgage

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payers, and potentially giving scope to the Bank of England to

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carry out further measures to ease monetary policy, if they think that

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is necessary. That would not happen if they talk it up. If the Vince

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and -- tore it up. If Vince Cable called for a new style fiscal

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stimulus, he is wrong and not going to get it question are he is

:08:59.:09:06.

He is absolutely supporting that he believes the government's deposit

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reduction strategy should stay in place. He has pointed out sensibly

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that the Bank of England, when inflation comes down next year as

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we believe it will do, has the scope to do more quantitative

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easing. Why did he not call for a fiscal stimulus? He is supporting

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the policies that Danny Alexander has implemented this week, for

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example, where we have found an additional half a billion pounds to

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put into capital expenditure. you seriously looking me in the

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face and saying that half a billion pounds of a trillion pound economy

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is a new deal style fiscal stimulus? Tell me. I am saying it

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is one of a whole series of things that the government is doing, and

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can be going along with the Bank of England, to support growth. Danny

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Alexander has made it clear there will be no extra fiscal stimulus. A

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new deal style stimulus is not saying, we will bring something

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sport, we will change the money and spend it here rather than there.

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The key is in the world stimulus. It is extra, and that is not going

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to happen, is that right? There are other ways of delivering a stimulus

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to the economy that don't simply rely upon the government breaking

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public expenditure plans. The CBI has described a number of ways in

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which the private sector could play a bigger role in supporting growth

:10:25.:10:30.

in infrastructure spending. It is not investing because it doesn't

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really... It hasn't got confidence in the coalition government to

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provide the economic framework that would make investment sensible.

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don't think that is right. I have spoken to the head of the CBI, is

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supportive of what the government is doing. He doesn't have money to

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invest. He is looking for the government, which is what the

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government is also seeking to do, to support private business

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investment, and talking about the role in infrastructure. Why isn't

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business investing? Business is reliant on the general state of the

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economy, and we have been buffeted in the United Kingdom by the same

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pressures... We have considered that. And we need to look at doing

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the things we can do to support the businesses that have got the money,

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but also potentially, to get additional credit through to the

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small and medium-sized business centre, where we know there are

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genuine credit constraints. There is a crisis building up in the

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wholesale money markets, that any banks with substantial sovereign

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debt exposure can't even borrow now, or they borrow a very high rates

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and a very short term. It is of a big concern in the United Kingdom

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there we have this crisis of confidence in the eurozone, that

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:11:57.:12:01.

To we have a big stake, even though we are not members of the euro, to

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solve those problems out. Dee's be a lot to Nick Clegg, David Cameron?

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-- do you speak a lot? I don't believe in phoning up the

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leadership 10 times a day and giving them my advice. What about

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once a day? When I have something to say that I think maybe useful, I

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feed it in. When they think I have anything to say, they may ask my

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views. But they have plenty of other very good advisers. Danny

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Alexander is over there now. He is doing a damn good job. Waiting in

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the wings, he is joining us in a minute. He is doing a damn good job.

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You have to say that. He is. Many people in the media were throwing

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stones original, they are not throwing them now. The Daily

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Politics has never thrown a stone at Danny Alexander, I want that on

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the record. We have not thrown one and you either, maybe the odd

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pebble, or a Chucky. Do you know what that is? Danny will tell you

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what that is. David Lloyds likes plan A, at least that is what he

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told us -- David Laws likes. What about you? Are you a A, or B

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person? We sent Adam off with his box of tricks to find out.

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This conference is taking place against a backdrop of grim news

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about the economy. The most recent piece being the IMF downgrading its

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forecast for Britain's growth this year. Do the Lib Dem delegates

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thinks the government should stick to its plan a on the economy, or is

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it time for a Plan B? It is very difficult. We don't know if the

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plan is working or not. There is no Plan B. I would like to put it in

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plan B, but I can't see a credible, coherent alternative, so I'll have

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to go with plan A, against my best wishes. You have gone for plan A,

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why? It is difficult, but it is slowly moving in the right

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direction. I think we ought to stick with it. If we change

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direction, it will undermine the markets. Let's -- it is time for

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Plan B. Plan A is looking... Affecting the low-paid, the

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underprivileged only. We now need to speed up the tackling of the

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rich. One thing you can say about the Conservatives, it does hurt and

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sometimes the cuts are not fair, but they usually do saw the economy

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out to an extent. I hope it is the crude way of judging economic

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policy. I would not take part in that because I am a plan A plus

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person. I am not trying to be difficult. If you were Michael

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Crick, I would give the same answer. Your menu choice is to be expanded,

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it is never that simple. What do you think of this as a polling

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method? As long as you choose the sampled the cricket, this is

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precisely the method as the one we used to predict the general

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election in our exit poll -- as long as you choose the sample

:15:08.:15:14.

correctly. That is the seal of approval from the experts. I will

:15:14.:15:24.
:15:24.:15:29.

probably go for plan B at the Vince Cable, right up your street,

:15:29.:15:36.

Plan A or plan B on the economy? No, perhaps he does not have a view.

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Let's see who is in the lead, it is planning by a mile. But a lot of

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people have said they are voting for Plan A plus. Vince Cable, do

:15:50.:15:56.

you want to pick up one of the balls? You have got it control on

:15:56.:16:01.

the interest rates on sovereign debt. Plan B leads to greater cuts

:16:01.:16:09.

in the long term. Are you confident that pioneers working? I am apply

:16:09.:16:13.

any person, but not with any joy, and no one really knows how it is

:16:13.:16:20.

going to pan out. The Liberal Democrats should not be helping the

:16:20.:16:25.

Conservatives so much. The reason there is not much in Plan B is

:16:25.:16:35.

possibly, what is plan B? Labour need to tell us what they would do.

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Below loads of delegates have voted and it is clear there are singing

:16:38.:16:46.

from the same hymn sheet. Most people are in favour of planning.

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Like David Laws, the rank-and-file were on message for Plan A,

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although some without much enthusiasm. As if by magic, we get

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two for the price of one, the former Chief Secretary to the

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Treasury, David Lodge, and now we have his successor. -- David Laws.

:17:06.:17:13.

It is Danny Alexander. My worry is that I will not get a cigarette

:17:13.:17:19.

paper between the two of you. Let me try. Has Vince Cable ever

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suggested that he wants more capital spending? What we have

:17:24.:17:27.

discussed is what I have been describing today, how do we make

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sure that the capital spending we have set aside, which we prioritise,

:17:32.:17:37.

how do we make sure that happens on schedule? Bureaucracy often holds

:17:37.:17:44.

these things up in government and we cannot afford for that to happen.

:17:44.:17:47.

Can we use our spending more effectively to help the private

:17:47.:17:51.

sector and bring forward developments. The thing I announced

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on Sunday was a fund specifically aimed at unlocking local

:17:56.:18:01.

development sites that have been stalled. That is intelligent use of

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the money. We're committed to the spending plans we have set out

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because it is important to our nation's credibility. So it is

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fiddling, moving around the deck chairs, but not adding to the

:18:16.:18:22.

number of deckchairs? I am not sure I want to pursue the deck chairs

:18:22.:18:27.

analogy. It is in the context of the massive work going on in

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government to identify the things we can do to help economic growth.

:18:32.:18:36.

I would argue that our deficit reduction plan is the foundation of

:18:36.:18:42.

growth, but many things, like the regulation, the planning sector,

:18:42.:18:48.

these are all there to lift the productive potential of our economy.

:18:48.:18:53.

Words mean nothing if we cannot agree that that does not amount to

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a new deal style fiscal stimulus. It is not a fiscal stimulus, it is

:18:59.:19:04.

sticking within our existing spending plans. We're spending �700

:19:04.:19:11.

billion of public money this year. 50 % of GDP. Over the course of

:19:11.:19:17.

this financial period, 2.8 trillion pounds will be spent by government.

:19:17.:19:24.

We cannot spend �700 million and -- if we cannot spend �700 million and

:19:24.:19:29.

do some good, we need to try something else. He cannot comment

:19:29.:19:34.

because he is the Treasury minister, but you are not, should the Bank of

:19:34.:19:39.

England going for more quantitative easing? Provided we hold course on

:19:39.:19:43.

the deficit reduction plan, which is what we're going to do, if the

:19:43.:19:47.

economy remains weaker than we would like because of international

:19:47.:19:52.

pressures, the bank will be in a position to consider different

:19:52.:19:57.

sorts of quantitative easing. Particularly as we know that it is

:19:57.:20:00.

likely that the uncomfortable inflation we have had this year is

:20:00.:20:05.

likely to come back down next year, because the increase in food and

:20:05.:20:12.

energy prices will not feed through again. You can comment on this

:20:12.:20:17.

because you are a backbencher. Is it not inevitable that giving

:20:17.:20:23.

Greece's public debt is now heading for 200 % of its GDP, and the

:20:23.:20:28.

economy is declining by 6%, that Grease defaults as night follows

:20:28.:20:37.

day? I think that the fault is not the word I would use. -- a

:20:37.:20:41.

defaulting. The Eurozone governments need to come together

:20:41.:20:47.

with the Greek government to do two things. To have a serious strategy

:20:47.:20:50.

for deficit reduction in Greece and to look at where there the debts

:20:50.:20:55.

they have got, which are difficult to manage, can be re scheduled to

:20:55.:21:01.

make them bearable. How can you ask the Greeks to do more when as the

:21:01.:21:05.

schools went back last week they did not even have textbooks? We can

:21:06.:21:10.

ask them to deliver on the promises they may can be serious about that,

:21:10.:21:15.

and secondly, if they do those things they can expect assistance

:21:15.:21:21.

from the other EU governments, which could include re scheduling

:21:21.:21:27.

their dead so that the burden is bearable. If we put to march on

:21:27.:21:35.

Grease, we will create problems. You can answer this question but I

:21:35.:21:40.

am not sure that you will. When we will look at what is happening in

:21:40.:21:43.

the money markets, for the financial system to work, banks

:21:43.:21:49.

need to borrow from the wholesale market, then they lent to us. That

:21:49.:21:53.

is drying up in the way it did before the collapse of Lehman

:21:53.:21:58.

Brothers. The banks are not able to earn because they have Greek debt

:21:58.:22:04.

on their balance sheets. Are we not on the brink of another major

:22:04.:22:09.

financial meltdown? I would not necessarily draw those parallels

:22:09.:22:14.

myself but there is a lot of uncertainty in the market. That is

:22:14.:22:17.

fuelled by doubts about the ability of politicians to get to grips with

:22:17.:22:23.

the problems they have. People like it the United States and see the

:22:23.:22:28.

Congress and the President not been able to agree. People look at the

:22:28.:22:31.

Eurozone and see those governments not coming up with solutions as

:22:31.:22:39.

quickly as they need to. markets and are acting in a way...

:22:39.:22:43.

The reason why the markets are not lending money to the banks is

:22:43.:22:46.

because they see the politicians are not doing anything to sort the

:22:46.:22:52.

problem and that in itself will create a financial crisis. We need

:22:52.:22:56.

to see those steps taken in those countries. Are you nervous about

:22:56.:23:02.

the current situation? It is extremely challenging. It has a

:23:02.:23:06.

real effect on the economy of this country and people in every corner

:23:06.:23:11.

of the United Kingdom. That is why we're working with our partners in

:23:11.:23:16.

the Eurozone to encourage them to take steps that need to be taken,

:23:16.:23:21.

and make sure that each country does the right thing in terms of

:23:21.:23:26.

its own economic situation. It is not often you get two chief

:23:26.:23:31.

secretaries, one former and one current, so I have a quiz for you

:23:31.:23:37.

both. Who said in January 2009, printing money is the last resort

:23:37.:23:42.

to desperate governments when all other policies have failed? Was if

:23:42.:23:52.
:23:52.:23:53.

you, Andrew. No. I need to spend more time listening to my

:23:53.:23:58.

colleagues' speeches! It is your current boss, George Osborne, the

:23:58.:24:07.

Chancellor. He said that printing money is the economics of Mugabe?

:24:07.:24:13.

think that was Vince Cable. You are correct. Do we have a bigger

:24:13.:24:17.

structural deficit than we thought, because the Financial Times report

:24:17.:24:21.

this week came out with a structural deficit of 12 billion

:24:21.:24:28.

more than what you calculations are based on? We set up an independent

:24:28.:24:31.

Office For Budget Responsibility to take the judgment of those things

:24:31.:24:36.

out of the hands of politicians. I will wait for their forecast rather

:24:36.:24:43.

than relying on speculation. was borrowing at a record in

:24:43.:24:47.

August? I thought you were meant to be cutting borrowing? You have been

:24:47.:24:53.

in power for 17 months and you had to borrow �16 billion in August.

:24:53.:24:58.

That has never happened in our history. There were special factors.

:24:58.:25:04.

The previous month, borrowing had been much lower than it had been

:25:04.:25:08.

the previous year. We have one of the largest deficits of any

:25:08.:25:15.

developed country. When we came into office, borrowing 150 billion,

:25:15.:25:20.

we're bringing it down this year. That is still greater than the cost

:25:20.:25:23.

of funding the entire National Health Service. This is why you

:25:24.:25:31.

think you have to bring it down? Correct. The target is 122 billion

:25:31.:25:37.

this year? Yes. That is what was set out. We are on target for this

:25:37.:25:43.

year. The Office For Budget Responsibility's calculations

:25:43.:25:48.

assumed a higher growth rate and we're currently experiencing, so

:25:48.:25:52.

are you not going to have lower tax rates and higher welfare payments

:25:52.:25:57.

to make? A inflation has an impact on those kind of cost, feeding

:25:58.:26:03.

through in future years. That is what the last will be are forecast

:26:03.:26:10.

showed. We will see what they came out with in November. -- the last

:26:10.:26:14.

Office For Budget Responsibility forecast. People need to have

:26:14.:26:20.

confidence in Britain's ability to pay off her debts. Would you like

:26:20.:26:25.

your old job back? Sadly, I think Danny Alexander is doing too good a

:26:26.:26:33.

job. When will we see you back in government? I do not know. I am a

:26:33.:26:37.

strong supporter of the coalition but we have very good ministers,

:26:37.:26:43.

including at the Treasury. You were a Business Secretary? If you were a,

:26:43.:26:49.

you would be more on message than the current one? Despite your

:26:49.:26:57.

mischief-making attempts, we have a very good Business Secretary.

:26:57.:27:00.

rank-and-file Want You Back, let's look at the audience. They are

:27:00.:27:05.

mostly journalists. I think they have come to see the current Chief

:27:05.:27:10.

Secretary. That is The Daily Politics audience. They have come

:27:10.:27:16.

here to see you today. Thank you to board if you for being such good

:27:17.:27:24.

sports and for being here on The Daily Politics. Let's go to Jo.

:27:24.:27:30.

It is time now for some hacks, not me, of course. There was a time

:27:30.:27:35.

that discussing leader trip troubles was as much part of party

:27:35.:27:40.

conferences as nursing a hangover. -- leadership troubles. Not that

:27:40.:27:44.

this one, everyone seems to be solidly behind Nick Clegg, but if

:27:44.:27:50.

that changes, how do you get rid of Liberal Democrat leader? Here is

:27:50.:27:58.

Giles. There are a number of circumstances

:27:58.:28:02.

that can provoke a Liberal Democrat leadership election and there are

:28:02.:28:07.

all covered in article 10 of the party's constitution. The triggers

:28:07.:28:11.

for such a contest are if the leader calls an election, such as

:28:11.:28:18.

Charles Kennedy did, or resigns, such as Menzies Campbell did, or

:28:18.:28:22.

resigns or dies or is incapacitated. That involves the leader but the

:28:22.:28:26.

only way for the party to force a leadership election is if there is

:28:27.:28:34.

a vote of no confidence colt by a majority of MPs are request for a

:28:34.:28:39.

leadership election by at least 75 local parties. You cannot just put

:28:39.:28:43.

your hat in the ring, you need at least 10 % of the parliamentary

:28:43.:28:49.

party to support you, 200 party members, and they have got to be

:28:49.:28:54.

from at least 20 different local parties. That is a lot of telephone

:28:54.:29:01.

bashing. But things are rosy-ish for the current leader. Bound

:29:01.:29:05.

though he is by being in a coalition with the Conservatives,

:29:05.:29:09.

which some Liberal Democrats do not like, it is unlikely for the time

:29:09.:29:17.

being that anyone will use these rules to challenge Nick Clegg.

:29:17.:29:20.

Charles reporting there. Keeping the company, we have Simon Hoggart

:29:20.:29:27.

from the Guardian and Andrew Pierce from the Daily Mail. Andrew, you

:29:27.:29:30.

could say that Nick Clegg has survived? There has not been a

:29:30.:29:34.

leadership challenge which is an achievement in itself? If you

:29:34.:29:40.

consider where the party was after the AV referendum, when they were

:29:40.:29:46.

crushed, a blow for her Nick Clegg's authority, it was a success

:29:46.:29:52.

for him. Byatt I am surprised he has not died of boredom this week

:29:52.:29:59.

because this has been uninteresting. Really? Yes, it is flat. The

:29:59.:30:03.

problem is that this conference hall is too big for the Liberal

:30:03.:30:07.

Democrats. They need a smaller venue because they are a small

:30:07.:30:17.

party. There is not a lot of policy in terms of announcements? No.

:30:17.:30:23.

know we should not say these things, but if Nick Clegg were to fall

:30:23.:30:28.

under the proverbial bus, who would replace him? It would be between

:30:28.:30:37.

Chris Huhne, and Tim Farron, the party president, who is a

:30:37.:30:44.

Lancashire lad. He said yesterday, the economy is barbered. I do not

:30:44.:30:52.

think he will fall under a bus. There would be a great dividing

:30:52.:30:56.

point between the Liberal Democrats and the Tories if that Nick Clegg

:30:56.:31:00.

had to go back and say, our people will not change their view on this

:31:00.:31:06.

one. People keep raising the subject of divorce, but if you do,

:31:06.:31:11.

your spouse may take the hint after a while. I think that is what Tim

:31:11.:31:21.
:31:21.:31:21.

Isn't it a synthetic cardamom, marriage, divorce, distancing --

:31:21.:31:26.

synthetic argument? We sound like relationship counsellors. They are

:31:26.:31:30.

in a dysfunctional relationship because they loathe each other.

:31:30.:31:35.

all of them. A lot of it, or they want to beat the Tories when they

:31:35.:31:39.

campaign. It is an unlikely pressure, they have done incredibly

:31:39.:31:43.

well to keep it together and I think it will continue. Nick Clegg

:31:43.:31:46.

seems more relaxed at this conference, which is slightly

:31:46.:31:50.

bizarre, if you think the calculation when they came into the

:31:51.:31:54.

coalition was that fears of austerity, economic upturn and we

:31:54.:32:00.

will get back in next I -- a few years of austerity. What happens to

:32:00.:32:08.

the party? It is descending into Death Valley. I did gather a report

:32:08.:32:16.

of Nick Clegg smiling once. There is a whole website of Nick Clegg

:32:16.:32:24.

looking sad! That missing puppy that his children lost has not

:32:24.:32:29.

turned up yet. He reminds me of an exasperated headmaster with the

:32:29.:32:34.

recalcitrant school assembly. In the question and answers session he

:32:34.:32:36.

was tetchy with those Liberal Democrat members, because he wants

:32:36.:32:40.

to make this work and he is fed up with them complaining and moaning.

:32:40.:32:43.

He should talk to Vince Cable who complained and moaned all through

:32:43.:32:47.

his speech. Do you think that needs to change? Does there need to be

:32:47.:32:55.

more uplifting? Truth and honesty, it fair enough but you have to have

:32:55.:32:58.

something to be uplifting. You have to talk about the sunny uplands

:32:58.:33:03.

even if they are not going to happen. Every study of politics

:33:03.:33:09.

shows that it is the optimism that wins. Ronald Reagan it knew nothing

:33:09.:33:14.

about the role of government but he was an optimist. You need a smack

:33:14.:33:23.

of that. Why do you think Nick Clegg is more relaxed? Is it

:33:23.:33:30.

because they feel the rock bottom was tuition fees, that has gone,

:33:30.:33:35.

and the AV referendum was I think that is it. He has displayed what

:33:35.:33:41.

is called muscular liberalism. It is a way of trying to have a

:33:41.:33:47.

different narrative, he feels he has pitched it right and he is

:33:47.:33:57.
:33:57.:34:02.

cheering up his activists. If you Conservatives watching this, will

:34:02.:34:12.
:34:12.:34:13.

they be interested, will they be put off? You have the realists who

:34:13.:34:16.

might say, we have got to stick with these people, at least until

:34:16.:34:20.

the next election. You have the head bangers who are saying, these

:34:20.:34:23.

appalling people are holding us back from going Britain what it

:34:23.:34:28.

really needs. Whenever Paddy Ashdown specs, the conference is a

:34:28.:34:34.

little bit electrified. -- speaks. I don't think they're going to be

:34:34.:34:39.

excited this afternoon. Talking of excitement, you can have a badge.

:34:39.:34:47.

Which one would you like? I love mansion tax, Andrew Pierce? I think

:34:47.:34:51.

I will have don't panic. I have already pinched, I love the

:34:51.:34:58.

EU, but it is ironic! Is it? -- I love the euro. The Liberal

:34:59.:35:04.

Democrats used to La for the euro, it is very much in the past.

:35:04.:35:09.

used to love the euro. Has it been a good or bad year for the Liberal

:35:09.:35:13.

Democrats. Can you remember the ups and downs? This will jog your

:35:13.:35:23.
:35:23.:35:26.

We confounded those who said that coalition government was impossible.

:35:26.:35:29.

The Liberal Democrats and the Conservatives are, and always will

:35:29.:35:34.

be, separate parties with distinct history is and different futures.

:35:34.:35:42.

But for this Parliament, we work together. To raise the cap on

:35:42.:35:46.

tuition fees is wrong. We will resist, vote against, campaign

:35:46.:35:55.

against any lifting of that cap. course, I feel really bad. It is

:35:55.:35:59.

one of the most difficult things I have ever had to do, to own up to

:35:59.:36:03.

the fact that I signed a pledge which I feel I can't deliver.

:36:03.:36:06.

Graduates should make some contribution for the benefit of

:36:06.:36:11.

going to university, the question is how. The road to Westminster are

:36:11.:36:14.

covered with the skid marks of different political parties

:36:14.:36:24.
:36:24.:36:27.

changing direction on this issue. The waiting is over, this was to be

:36:27.:36:31.

the day of the cuts. The day when people would learn what they meant

:36:31.:36:36.

for their jobs, their pensions, to their services. Today is the day

:36:36.:36:41.

when Britain steps back from the brink. We are picking on the week

:36:41.:36:45.

is society -- you are picking on the week is people in this society

:36:45.:36:49.

and it is completely unfair, how you have applied this budget.

:36:49.:36:52.

the real world, the richest are paying the most. There is no doubt

:36:53.:37:02.
:37:03.:37:19.

Getting up early, what I call a lot of Britain, working hard, we are on

:37:19.:37:29.
:37:29.:37:29.

AV would be wrong for Britain. It is obscure, it is unfair, it is

:37:29.:37:34.

expensive. This is a campaign built on lies and a deeply personal

:37:34.:37:39.

attack on the Deputy Prime Minister. If you thought it was all over, it

:37:39.:37:44.

is now. By well over two to one, Britain voted not to change its

:37:44.:37:50.

This is a bitter blow for those people like me to believe in the

:37:50.:37:55.

need for political reform. We are seeing a repeat pattern of northern

:37:55.:38:00.

cities where the Liberal Democrats are losing not just one or two, but

:38:00.:38:06.

virtually all of their This is not the moment to embark

:38:06.:38:10.

upon the reorganisation of the most trusted public service in the whole

:38:10.:38:16.

of the United Kingdom. Pause. Listen. To reflect. We are not

:38:17.:38:20.

afraid to disagree, to have the debate and bring together the best

:38:20.:38:24.

of our ideas. You will see a strong liberal

:38:24.:38:30.

identity in a strong coalition government. You might even call it

:38:30.:38:40.
:38:40.:38:44.

You can't smash a window and grabbed a BlackBerry, a pair of

:38:44.:38:49.

shoes, a T-shirt that you like the look of and sometimes you think you

:38:49.:38:59.
:38:59.:39:00.

The idea that we are going to shift of focus to the wealthiest in the

:39:00.:39:05.

country when everyone is under pressure is cloud-cuckoo-land.

:39:05.:39:08.

is right to privatise the help to millions of people who need it the

:39:08.:39:12.

most, and not to a small minority of people who don't need as much

:39:12.:39:22.
:39:22.:39:29.

help. In other words, the people at That was the year, and I am joined

:39:29.:39:33.

now by Lorely Burt, the chair of the Liberal Democrat party. We have

:39:33.:39:36.

seen that the party has been battered over the past year to some

:39:36.:39:41.

extent, by tuition fees, the drubbing at the local elections,

:39:41.:39:46.

the AV referendum. Are you in denial about the state of the party,

:39:46.:39:51.

Alan? No. One of the reasons that your previous commentator found it

:39:51.:39:54.

boring is that there is no great row or bust-up. For me, the

:39:54.:39:59.

highlight of the year was 5th April when 1 million people came out of

:39:59.:40:04.

income tax because Liberal Democrat policy had been carried out. People

:40:04.:40:07.

have things they want the coalition to do, but there are things they

:40:07.:40:11.

are delighted it has done. suppose I am thinking more about

:40:11.:40:16.

where the party is at. There may have been no big bust ups, but it

:40:16.:40:20.

is a sort of, we haven't got an alternative, cross our fingers,

:40:20.:40:25.

everyone is looking cheerful. Should they be? Yes, because they

:40:25.:40:29.

are doing what is right, supporting a party into coalition. We have

:40:29.:40:32.

been arguing that we should change our political system to one in

:40:32.:40:36.

which parties work together. you lost on the AV referendum, it

:40:36.:40:41.

is gone for a generation? We have a coalition now in the present system.

:40:41.:40:44.

The present system will deliver governments that do not have a

:40:44.:40:50.

majority, that have to form coalitions. The old loyalties to

:40:50.:40:54.

the old parties have dissipated and it is a much more fluid politics.

:40:54.:41:01.

This conference has been all about differentiation. We have heard that

:41:01.:41:06.

word endlessly. But the latest poll says 68% of the public don't know

:41:06.:41:10.

what Nick Clegg stands for, that is a big problem. We have always been

:41:10.:41:16.

branded as, the nice Liberal Democrats. That is because you were

:41:16.:41:20.

never in powerful top yeah, we like to vote for you but we are not sure

:41:20.:41:23.

what you stand for. -- that was because you're never in power

:41:23.:41:27.

before. Now they know that we are standing for working for the good

:41:27.:41:33.

of the country. That is a very broad thing. What is it that Nick

:41:33.:41:40.

Clegg stands for? Fairness, improving the tax system, so that

:41:40.:41:46.

the least well are able to pay benefit most. He stands for green

:41:46.:41:51.

ness, the Green Bank, we are going to be the greenest government ever.

:41:51.:41:55.

We have restored the earnings link, we have done so many things since

:41:55.:42:03.

we have been in government. suppose the issue of the green tax

:42:03.:42:06.

is a number one concern, energy prices, these are not things that

:42:06.:42:11.

people support. Energy prices are rising, not because of things that

:42:11.:42:14.

we are putting into place but because of what is happening

:42:14.:42:18.

elsewhere in the world. We have got to take action to get our own

:42:18.:42:24.

economy, based on our own energy. Lorely Burt has listed the

:42:24.:42:28.

achievements, why is the party at rock bottom? Doldrums in the polls,

:42:28.:42:32.

popularity at the bottom. If you have done so much wonderful stuff,

:42:32.:42:36.

why aren't you doing better? We had to take difficult decisions which

:42:36.:42:40.

involved cutting back on things we would prefer not to do. The tuition

:42:40.:42:44.

fees decision is one we would not have chosen to make. We are in a

:42:44.:42:49.

much worse financial position than we expected. We have produced a

:42:49.:42:53.

fair position for people on lower incomes. We have a message to

:42:53.:42:57.

deliver to people. In a conference like this, the coverage will start

:42:57.:43:01.

to tell people what we stand for. Do you agree with Vince Cable that

:43:01.:43:07.

it is time for a stand at -- time for a stimulus? We already

:43:07.:43:11.

delivering a stimulus, we can't increase the amount we are spending

:43:11.:43:18.

over and above what we do. We could see the Bank of England putting

:43:18.:43:24.

more money into the economy, the famous quantitative easing. Vince

:43:24.:43:29.

Cable can't say that sort of thing publicly. What about a stimulus,

:43:29.:43:34.

what about growth? Do you agree with Vince Cable, even if what he

:43:34.:43:37.

said isn't going to happen? Would you like to see more money come in

:43:38.:43:42.

now? I would love to see more money, but we haven't got the money. So

:43:42.:43:51.

much of it is going on redressing If we don't get that right, we

:43:51.:43:56.

asked daft as a country. Name one thing you would like to see the

:43:56.:44:00.

Liberal Democrats claim credit for in the rest of this Parliament --

:44:00.:44:05.

we are staffed as a country. fairness agenda. Meaning what?

:44:05.:44:10.

Fairness to pensioners... What specific policy would you like to

:44:10.:44:15.

see? I would like to see more to do with... My area is business. I

:44:15.:44:21.

would like to see fairness between working people and companies as

:44:21.:44:25.

well, giving companies what they need to be able to grow, but

:44:25.:44:31.

insuring people get their fair rewards as well. The 50p tax rate,

:44:31.:44:34.

shouldn't the Liberal Democrats be more worried about what happens at

:44:34.:44:43.

the other end rather than at the We are not going to touch the 50p

:44:43.:44:47.

tax rate and less, and until we have raised the threshold for

:44:47.:44:50.

people on low incomes, and found better ways of making sure the

:44:50.:44:57.

richest people pay their share. Take a bad, what would you like? --

:44:57.:45:03.

take a badge. I love high-speed rail. That would bring a great

:45:03.:45:07.

economic stimulus to the West Midlands, so I will take this on.

:45:07.:45:17.
:45:17.:45:20.

back the coalition. What a loyalist Party members have been taking part

:45:20.:45:24.

in an emergency debate on the NHS. It is probably fair to say that

:45:24.:45:29.

Nick Clegg has taken a bit of a pasting by some of the speakers.

:45:29.:45:35.

Listen to this. He has done an enormous amount of work, as have

:45:35.:45:39.

many in our parliamentary party to get these concessions, but we

:45:39.:45:45.

should never have been made in the first place, Nick Clegg should not

:45:45.:45:51.

have put his name to it because it was not what we agreed. Nick Clegg

:45:51.:45:56.

has had massive publicity saying that no one would be able to make a

:45:56.:46:01.

profit out of our children's education. But what I do not

:46:01.:46:07.

understand is why eight days or Kate... Sorry, why is it not OK to

:46:07.:46:13.

make a profit out of our children's education, but it is OK to make a

:46:13.:46:20.

profit out of our bad health? For my real concern, speaking to people

:46:20.:46:24.

in the youth and children's sector is the impact of this at the sharp

:46:24.:46:28.

end, the fragmentation of services which will have an impact on

:46:28.:46:34.

children. How many more children will end up being taken into care

:46:34.:46:40.

or even been a missed, like Baby P? I am worried that we are

:46:40.:46:43.

fragmenting services that are so important for every single one of

:46:43.:46:49.

us. That is not about party politics, but about why we came

:46:49.:46:56.

into politics, caring for our nation. Let's get the thoughts of a

:46:56.:47:03.

man who apparently, party president, Tim Farron, wants to be like when

:47:03.:47:09.

he grows up. I speak of the deputy leader, Simon Hughes. Who do you

:47:09.:47:15.

want to be when you grow up? Do not say Tim Farron. I think I am past

:47:16.:47:21.

thinking about this. But these health reforms, they are not

:47:21.:47:27.

popular with your members? How did you end up down this road? There is

:47:27.:47:31.

a simple answer, and there is a lot of work to do on the bill in the

:47:31.:47:39.

Lords. Our members there are clear about that. I thought the party

:47:39.:47:42.

leadership wanted to close that down, you had your rebellion in

:47:42.:47:50.

March? No, what we did not want was a full-scale debate to open up

:47:50.:47:55.

everything. To answer your first question, how we are here, this was

:47:55.:47:59.

not a Bill that came from the coalition agreement. It seemed to

:47:59.:48:05.

surprise everybody, including David Cameron. That may be true but I

:48:05.:48:08.

have no problem of following the coalition agreement that was

:48:08.:48:14.

negotiated. But the Forestry thing, that was another thing that came

:48:14.:48:19.

that was not negotiated. But we now have good procedures in place, we

:48:19.:48:24.

now have a system that unless something was in our manifest or

:48:24.:48:29.

the coalition agreement, we will only supported if the parliamentary

:48:29.:48:33.

party considerate and vote in favour. That is our safeguard for

:48:33.:48:39.

the country. A colleague -- at colleagues of yours, Andrew George

:48:39.:48:45.

MP, he says that will allow support the coalition I want to do my best

:48:45.:48:49.

to save the NHS from what I believe may be a catastrophic train crash

:48:49.:48:55.

which I believe may take the party with it. Is he representative?

:48:55.:49:01.

There are people that share his view. Let me get this clear, the

:49:01.:49:09.

argument over the health reforms is by no means over? It is not over.

:49:09.:49:16.

We made it clear at our conference in March, and the bill was stopped.

:49:16.:49:20.

Large numbers of amendments were put in at committee stage and

:49:20.:49:25.

report stage. It has gone to the House of Lords and there are some

:49:25.:49:31.

significant things that need to be done, in my view. I believe that

:49:31.:49:35.

because our Piers are clear about that... Gave me the most

:49:35.:49:40.

significant change you want to see? We need to tie down the private

:49:40.:49:45.

work of the NHS, so that they cannot become the dominant or

:49:45.:49:53.

financial practical activity. It's are you still suspicious of private

:49:53.:49:58.

activity in the NHS? We have got to make sure it cannot become the

:49:58.:50:04.

driver of any part of NHS activity. That is very interesting. We will

:50:04.:50:09.

keep an eye on that in the weeks ahead, when Parliament comes back.

:50:09.:50:14.

On the broader picture of your party, you lost the AV referendum

:50:14.:50:21.

in style, voting reform is probably off the agenda for regeneration,

:50:21.:50:26.

your last 700 seats in local government, you are 11 % in the

:50:26.:50:31.

opinion polls, less than half what you wear at the election, the

:50:31.:50:35.

students hate you and the economy is in the tank, what has been the

:50:35.:50:40.

good news this year? You can lay cat one side of the picture. We had

:50:41.:50:44.

a difficult six months from November, I know that we handled

:50:44.:50:51.

tuition fees badly. I was clear about that at the time. And you are

:50:51.:50:57.

right, the referendum was not a great success. Since then we have

:50:57.:51:03.

started picking up seats at local government level. One or two. John

:51:03.:51:06.

Major used to tell me how many local government seats he was

:51:06.:51:12.

winning and I think he lost by 160 seats. I am trying to compare

:51:12.:51:18.

before and after. We have been taking up supporters and donors,

:51:18.:51:22.

and most importantly we have been taking upper mac position in the

:51:22.:51:32.
:51:32.:51:37.

opinion polls. I have seen 13 %. -- our position. We need to make sure

:51:37.:51:41.

that our economy does not go the way of the States and the other

:51:41.:51:47.

major economies. This city will not see manufacturing on its feet again

:51:47.:51:51.

if the whole economy is not under control and that is why we have got

:51:51.:51:55.

to be tough about that. You have heard that there will be an

:51:55.:51:58.

acceleration of the end it is putting activity back into the

:51:58.:52:05.

economy. Not a stimulus, and acceleration of existing plans?

:52:05.:52:08.

Absolutely. Transport infrastructure needs to be brought

:52:08.:52:16.

forward. As soon as there is the capacity we can do it. Do you think

:52:16.:52:24.

that this song that you have been singing is representative? We have

:52:24.:52:29.

a leader who has hung as out to dry. He made us a break air pledge, but

:52:29.:52:37.

we will stick with him because we loved him, because we love him.

:52:37.:52:45.

That was nearly a wrap, Andrew. that what date has come to? He hung

:52:45.:52:55.
:52:55.:52:59.

a side to dry. The official Lib Dems song book. -- hung us out to

:52:59.:53:09.
:53:09.:53:10.

dry. Have you not heard of Satar? We are joined by Nick Robinson. We

:53:10.:53:15.

have got the speech but we're not allowed to speak about the contents

:53:15.:53:19.

because it is under embargo. What do you think about it? It is an

:53:19.:53:24.

argument rather than a series of policy announcements. Does he try

:53:25.:53:29.

and says here are some new things I am unveiling, does he try and say,

:53:29.:53:36.

let me give you a vision of where we will be in 2015, to chew you up,

:53:36.:53:41.

or does he have an argument? I think that is basically what he

:53:41.:53:46.

will be doing. Without breaking the embargo, the phrase he will be

:53:46.:53:55.

using his, it is not easy, but it is right. Many people once loved

:53:55.:54:00.

him, Cleggmania, but the hard decisions were the right decisions.

:54:00.:54:05.

In a sense, his key argument to the country is that the Government is

:54:05.:54:09.

fair because Liberal Democrats are at the heart of it. He will say

:54:09.:54:14.

that is worth keeping. Is this an unusual speech in the sense that

:54:14.:54:18.

the messages the same for the party faithful in the hall and the wider

:54:18.:54:23.

audience watching at home. Sometimes they have got to give two

:54:23.:54:28.

messages? There are parts of the speech that will be significant in

:54:28.:54:32.

the hall which I suspect will not naked in two television reporter

:54:32.:54:37.

the newspapers, and in them he will say to his party it is not good

:54:37.:54:42.

enough to carry on being the opposition. The party was used to

:54:42.:54:48.

being the opposition for years. There is a danger that he continues

:54:48.:54:58.

to be the opposition party in government. His message to the

:54:58.:55:02.

people that think that, is that you can stand up on health, but you

:55:02.:55:06.

need an agenda for what you positively want to do, not what you

:55:06.:55:11.

want to stop. The mood of this conference has been quite upbeat.

:55:11.:55:16.

Is that because you are naturally an optimistic party are totally in

:55:16.:55:22.

denial? Neither of those things. thought my kit had to be one or the

:55:22.:55:27.

other. The options before me are not those. It is a serious

:55:27.:55:33.

conference. It is a serious conference for serious times by a

:55:33.:55:38.

serious party. Make Robinson made the point, quite rightly, that

:55:38.:55:42.

we're going to be judged on whether we have delivered and it is a five-

:55:42.:55:47.

year plan. It will last for the whole of five years. We knew that

:55:47.:55:51.

the first couple of years would be difficult and we have taken some

:55:51.:55:57.

heads, but it is no good going back. You have got to keep scoring

:55:57.:56:01.

Liberal Democrat victories, taking poor people lighted tax, and we

:56:01.:56:06.

will go on, within the coalition, tilting the Government away from

:56:06.:56:12.

what it would have been if it was Tory only, to a fairer outcome, so

:56:12.:56:16.

that we have recovery but it is fair because we are there.

:56:17.:56:21.

important thing is that what the Liberal-Democrats have done by

:56:21.:56:25.

coming first is that they have tried to tilted in the other

:56:25.:56:30.

direction. There will be Conservative MPs at their

:56:30.:56:33.

conference next week he will say that we do not like that killed

:56:33.:56:40.

very much. Let's get our own party leadership to bring it back, and

:56:40.:56:46.

Europe, tax cuts, crime, and this conference may cheer up Liberal-

:56:46.:56:49.

Democrats but it will also mean that there are Tories that say we

:56:49.:56:56.

are in for a fight. The good news for the country is that on the key

:56:56.:57:01.

issues there is an agreement. We need to stick to it. On law and

:57:01.:57:06.

order and Europe? There is no consensus on that? There is

:57:06.:57:12.

consensus. Even on stimulus, you seem to be divided. There has been

:57:12.:57:18.

a very pragmatic view on Europe taken by the Prime Minister. It is

:57:18.:57:22.

important that the Eurozone survives because we do 40 % of our

:57:22.:57:27.

business over the water. Ipsos MORI have introduced some new things

:57:27.:57:31.

from the opinion poll at the weekend. The Liberal Democrats are

:57:31.:57:39.

now seen as the most divided of the three men -- the three main Lidl --

:57:39.:57:47.

the three men national parties. This is the legacy of the tuition

:57:47.:57:52.

fees debate. That has clouded all sorts of things. In the end we

:57:52.:57:56.

tried to explain that we were not the Government on our own and the

:57:56.:58:00.

Tories did not agree with us. We could not win that argument

:58:00.:58:05.

internally. In terms of being divided, the political researchers

:58:05.:58:10.

have said over the last few years that we are the most united. The

:58:10.:58:15.

job has to be to make sure that this Government has things that

:58:15.:58:18.

matter to Liberals and Liberal Democrats. The answer is a fairer

:58:18.:58:26.

Britain. We have 10 seconds. It is a lot more cheaply than we thought

:58:26.:58:36.
:58:36.:58:36.

my cake would be. Let's give them credit. We have to go for the

:58:36.:58:46.
:58:46.:58:48.

moment. We will be back at 2:30pm. Not to o'clock, 2:30pm, for live

:58:48.:58:51.

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