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What happened to Coalition 2.0?

The Times ran an interesting piece (£) yesterday on the Queen’s speech for the next parliamentary session, expected in May. It reported that the Coalition has struggled to assemble a legislative programme of any great scope and depth and that business managers are worried about how they will keep MPs busy on a mere 12 bills.

Separately, Tim Montgomerie has penned a thoughtful column for Conservative Home today on how Number 10 views the Conservatives’ electoral prospects.  According to his account, Number 10 strategists paint a largely pessimistic picture of the party’s chances of gaining a good working majority in 2015, based in large part on their reading of the psephological runes. By default, they predict a continued coalition with the Liberal Democrats.

The two pieces are worth reading together for the insights they provide into the dynamics of this Coalition government.  In its first year, the Coalition achieved unity and momentum by defining itself against Labour’s record in government. Both parties could sign up to cutting the deficit, defending civil liberties and attacking Whitehall centralism.

But schisms soon emerged over electoral reform and Europe, exposing deeper ideological faultlines. Lacking a fundamental ideological affinity (one which Andrew Adonis warned about during the general election campaign in 2010), the Coalition partners are now struggling to define a new agenda for the remainder of the parliament. Each has veto points: the Liberal Democrats can rule out a shift to the right on employment law, Europe or the NHS, while the Conservatives can in turn constrain the Liberal Democrats on green issues, wealth taxes and constitutional reform. The result is stasis.

Perhaps more worrying for the Coalition, however, is the lack of policy energy and momentum that now characterises the government. There is a dearth of new ideas emerging from government departments, save from ministers like Michael Gove who possess a clear strategic direction. And things are little better at the centre. Abolishing the Number 10 Strategy Unit didn’t help, because it denuded the government of long-range thinking capacity, while Treasury mandarins who used to play this role when Gordon Brown was at his most powerful as chancellor are now hunkered down, working out how to squeeze growth out of the economy or prepare for a eurozone meltdown. Their time horizons are necessarily short.

It is therefore not at all clear from where the political basis for Number 10’s hopes of a renewed centre-right coalition might come in 2015. Tim Montgomerie is fond of pointing out that electorates have swung to the right after the financial crisis, not the left. But he can provide little evidence of the sort of ideological energy that characterised the political hegemony of the Conservative movement in the 1980s, when thinktanks like the Adam Smith Institute were rampant. Instead, he looks to Conservative journalists and the 1992 Committee, hardly a platform from which to mount a sustained ideological campaign, and certainly not one that can appeal to the political centre-ground. Tory modernisers like Nick Boles stand largely alone in framing new policy agendas that might prove capable of sustaining Coalition 2.0. Things look more optimistic for the Liberal Democrats, whose thinkers have been active of late. But as they seek to differentiate themselves and rescue their political brand, they increasingly tack across to the centre-left, not the right.

One major process will necessarily pull the partners together in the next few years, however, and that is the 2014 spending review. When Labour was in power, spending reviews were one of the key processes through which new policies were forged and manifestos written. (Indeed, lacking the founding influence of a spending review caused Labour real problems in framing its 2010 manifesto.) If the Coalition can use the 2014 spending review as a forcing mechanism for the development of a new agenda, it may recover some of the mojo it has recently lost.

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