Conference Special: Part 1 Daily Politics


Conference Special: Part 1

Andrew Neil and Jo Coburn are in Birmingham for the final day of the Liberal Democrat conference.


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Transcript


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

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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

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: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,

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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

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

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: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

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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

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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

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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,

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: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

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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

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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

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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,

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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

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

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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

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

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

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

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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

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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

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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

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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.

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

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

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

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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

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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

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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

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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

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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.

Andrew Neil and Jo Coburn are in Birmingham for the final day of the Liberal Democrat conference.

In the afternoon Nick Clegg will try to make people feel better about the government's economic message in his keynote speech. It will be a tough job for the party leader, as on Tuesday the IMF downgraded the UK's growth forecast for this year to 1.1 per cent. The programme talks to the Chief Secretary to the Treasury, Danny Alexander.


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