Letter from Westminster

Knocking on doors for the Scottish election, the subject of the coalition at Westminster is one which crops up quite a bit. Despite what you read in the national papers (and even some local ones) the comment was mostly balanced – a few enthusiastic and a few negative.

One man said to me: “I could never do a deal with the Tories – I remember what Thatcher did in the 1980s.” My answer to him may have taken him aback a little. I remember what Margaret Thatcher’s govern­ment did in the 1980s too – and that was why we went into government. The only thing that was certain at the end of last year’s election was that the Labour Party had lost the mandate it had had to govern. The options facing the Liberal Democrats then were coalition with the Conser­vatives, coalition with Labour or a minority Tory government. It is worth remembering how these other options would have played out. Coalition with Labour would have been the most difficult, even if they had wanted to share government with us – which they clearly did not. For us to maintain a losing govern-ment in power would have been difficult to justify and in any event would not have commanded a majority in the House of Commons. It is difficult to see how it could have been stable or lasting.

A minority Conservative govern­ment would have been the only other realistic alternative but I question seriously how long that would have lasted. I could imagine an emergency budget from George Osborne last June followed by another general election two or three months later on the basis that tough decisions needed to be taken and for that they needed an overall majority. It is difficult to see how they would not have got it – especially against the background of a rapidly deteriorating economic position where Britain was at real risk of ending up in the same position as Greece was then and in which Ireland and Portugal have most recently found themselves.

What would have been different about a majority Tory government? To pick one example at random, its tax policy would have been different. You would not have seen capital gains tax increased from 18 to 28 per cent – this, remember, is the bankers’ favoured tool for avoid­ing income tax on their bonuses. Nor would you have seen the increases in the threshold at which tax is payable and which has already taken about 800,000 of the lowest-paid in the country out of paying tax at all. The Conservative priority was to have been cuts in inheritance tax. Tax cuts for the lowest paid workers or the richest dead people? Like it or not you can not deny it makes a difference. Of course the other side of the coin is that Liberal Democrats have also had to make compromises. As a democrat as well as a Liberal I don’t think that having got 23 per cent of the vote we were entitled to get everything we wanted. In a coalition you don’t get everything but you get a lot more than you ever do in opposition.

Alistair Carmichael MP