Wednesday, May 12, 2010

Conservative-Liberal Democrat Coalition Agreement

The Coalition Agreement, setting out a plan for the new Government's priorities has been published. It's sorted into policy subjects. I'm going to take out the main points and categorise them as the good, the meh and the you're going to have to lock me in a cupboard with a bottle of gin when they're voting on this or I will explode.

The Good

We've agreed to their spending cuts this year BUT with important caveats:

arrangements that will protect those on low incomes from the effect of public sector pay constraint and other spending constraints;

The parties agree that modest cuts of £6 billion to non-front line services can be made within the financial year 2010-11, subject to advice from the Treasury and the Bank of England on their feasibility and advisability. Some proportion of these savings can be used to support jobs, for example through the cancelling of some backdated demands for business rates. Other policies upon which we are agreed will further support job creation and green investment, such as work programmes for the unemployed and a green deal for energy efficiency investment.
. (The work programme for the unemployed bit belongs with me in the cupboard with the gin bottle)

The parties agree that reductions can be made to the Child Trust Fund and tax credits for higher earners.
are both not a million miles from either of our policies

Our Pupil Premium, and their guarantee of increased funding for the NHS is there - although I hope we will still try and reduce the overmanagement that's so costly and inefficient.

They've agreed to an independent commission on public sector pensions - the Tories were going to cap them at £50,000 - and accrued benefits will be protected which was our policy. I'm not sure if it was the Tories' or not.

Restoration of the pensions/earnings link which is our policy

The parties agree that the personal allowance for income tax should be increased in order to help lower and middle income earners. We agree to announce in the first Budget a substantial increase in the personal allowance from April 2011, with the benefits focused on those with lower and middle incomes. This will be funded with the money that would have been used to pay for the increase in Employee National Insurance thresholds proposed by the Conservatives, as well as revenues from increases in Capital Gains Tax rates for non-business assets as described below. The increase in Employer National Insurance thresholds proposed by the Conservatives will go ahead in order to stop Labour’s jobs tax. We also agree to a longer term policy objective of further increasing the personal allowance to £10,000, making further real terms steps each year towards this objective.
is not quite raising the tax threshold to £10,000 but it's further than Labour ever got on that.

The Tories' ridiculous inheritance tax cut for the rich is junked along with our Mansion Tax.

Our tax switch on aviation duty to per plane rather than per passenger is in there

Capital gains to move towards being taxed as income

Detailed development of Liberal Democrat policies on tax avoidance

A banking levy, action on bankers' bonuses, a commission to work on the structure of the banking industry to report within a year.

Nationalised banks to be given lending targets and more help to businesses

The end of child detention in immigration centres. Phew!

There is no mention of the Tories' loopy plans to deliver public services by means of co-operatives in this.

Fixed term parliaments and an immediate setting of the date for the next election - 7th May 2015. This is a long standing Liberal Democrat principle but there is a caveat - it'll be fun, with the Scottish and Westminster elections up on the same day under different systems - isn't that what we're supposed to be avoiding after the 2007 debacle? We'll have to check if it's feasible. I suppose it has to be an odd number of years to stop it always coinciding with a particular set of Council elections all the time, and 3 is too few and 7 too many.

Power of recall for corrupt MPs

Wholly or mainly elected second chamber by PR - weird, Westminster will remain the only election which uses FPTP. Proposals on this to be sorted by the end of this year.

Full implementation of Calman proposals which the Tories were trying to wriggle out of - that's a good victory for us as there were reports that they wouldn't do anything in this Parliament.

Action on lobbying and party funding - although the wording on this is quite woolly

Ending of compulsory retirement age and requirement to buy annuity at 75 - both of these were our policy

Justice for Equitable Life policy holders that Labour failed to deliver

Pressing for EU to have only one seat - our policy

A Freedom Bill covering everything from no ID cards, better Freedom of Information, libel reform, restoration of right to non violent protest and much more. There is, however, nothing on the Digital Economy Bill. That should deserve demotion to the gin section alone, but as Scott pointed out on Twitter

But worst parts require new SI to bring them in. Now at least people on the inside batting on the topic (Vince at BIS eg)

The Meh

Trident. Let's face it, I'm a peace loving hippy who wants to see us get rid of all nuclear weapons. My own party's policy doesn't give me that and no coalition agreement with anybody was never going to. There is no point wasting energy getting upset on this.

Not joining the Euro and the Euro referendum if any more powers are ceded - Malc thinks we've sold out on this but we were never going to join the Euro anyway so there's really no problem. I suspect there may be some argument over what constitutes a ceding of power big enough to justify a referendum, but I don't think either of these things is necessarily worth dying in a ditch for.

I was going to put our agreement to the immigration cap in the gin section, but I've seen that their is to be joint consideration of the mechanism for implementing it. The principle is wrong but it can stay here for now until we see the final proposals.

I am not an expert on the details of the climate change stuff by any means so I would welcme some opinions on what's in the agreement. To me it doesn't seem robust enough on commitment to renewable energy - our £400 million commitment to get shipyards building renewable tech seems to have gone and our ambitious targets for the future seem to have been lost somewhere.

The "Bring me the Gin now"

We also agree that provision will be made for Liberal Democrat MPs to abstain on budget resolutions to introduce transferable tax allowances for married couples without prejudice to this coalition agreement.
Ok, it's tokenistic but the principle is so plain wrong that abstention isn't good enough. I am not chuffed we have caved on this.

Now, I know we could, some might say should, have held out for STV and gone into opposition of we couldn't get it. I have a whole load of sympathy with that argument. I would actually ditch the referendum on AV - it's a waste of money. Is AV worth us actually campaigning for? I wouldn't be bothered if this referendum never saw the light of day and we shouldn't have agreed to it.

There is a fudge on nuclear power

There will be a rammy on tuition fees at some point - and we'll only be allowed to abstain and not oppose.

The bit on welfare reform that we are signed up to isn't as bad as I thought. I'm not keen on welfare to work schemes because they often don't offer any real help or long standing jobs to the claimants. I'm sure there's worse in their manifesto, but I can't get it to download to check. Nevertheless, Iain Duncan Smith is in charge, which is deeply scary.

So, there's an awful lot of our policy going to be implemented if it all works out. There's also potential for trouble. I am kind of torn between being grateful that it's a Lib Dem, David Laws, in charge of managing the spending cuts and concerned that we'll end up with all of the blame for stuff that's not necessarily our fault.

There's potential for huge rows, but also for good. It could all go horribly wrong in just about every way but there's an element of utter madness about it that might make it work. I still have very, very mixed feelings about it, but mostly I'm thinking that this is a good antidote to the fear that trounced hope in the election. We're long overdue some hope getting its own back. Now to stock up on the Hendricks Gin......


Malc said...

That's not quite what I said, but I'll let it go.

Interesting point for you on nuclear power (not weapons - that's a different issue). Lib Dems are opposed to nuclear power but the Tories are for it... and Labour are too - so there is a majority FOR it in the Commons. BUT the Lib Dems have the Cabinet responsibility for energy.

How's that going to work? (with thanks to a friend for pointing that out to me).

Unknown said...

You did use the phrase "put the spoils of office above policy concerns" but having read your post again I realise that it wasn't meant as harshly as it sounded.

On nuclear power, this is what the fudge says:

Liberal Democrats have long opposed any new nuclear construction. Conservatives, by contrast, are committed to allowing the replacement of existing nuclear power stations provided they are subject to the normal planning process for major projects (under a new national planning statement) and provided also that they receive no public subsidy.
We have agreed a process that will allow Liberal Democrats to maintain their opposition to nuclear power while permitting the government to bring forward the national planning statement for ratification by Parliament so that new nuclear construction becomes possible.

This process will involve:

* the government completing the drafting of a national planning statement and putting it before Parliament;

* pecific agreement that a Liberal Democrat spokesman will speak against the planning statement, but that Liberal Democrat MPs will abstain; and

* clarity that this will not be regarded as an issue of confidence.

I suspect that a media and an opposition who hasn't seen anything like this before will find it very bizarre but I think being honest about our differences is the good thing. I suspect that it won't be Huhne who speaks against it, though, it'll be another Lib Dem and the measure will be introduced by a Conservative Minister. I don't have a problem with that part of the process.

You're right in that there's a majority in the House of Commons for it so why on earth are we not free to vote against?


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