Bloomberg News

Cameron Sets New Priorities for U.K. Coalition

January 07, 2013

Prime Minister David Cameron

Prime Minister David Cameron indicated in a Sunday Telegraph newspaper interview yesterday he’d like to stay in office another seven years, even as opinion polls suggest the Conservatives may lose power in 2015. Photographer: Simon Dawson/Bloomberg

U.K. Prime Minister David Cameron, setting new priorities for his coalition with the Liberal Democrats, put child care, the elderly and transport investment at the core of his agenda in the run-up to elections in 2015.

Cameron, who leads the Conservative Party, was holding a joint news conference in London today with Liberal Democrat Deputy Prime Minister Nick Clegg to highlight their shared agenda as they publish a “Mid-Term Review” summing up coalition achievements since 2010 and announcing new policies.

“We will support working families with their child-care costs,” Cameron and Clegg wrote in the joint foreword to the document. “We will build more houses and make the dream of home ownership a reality for more people. We will set out plans for long-term investment in Britain’s transport infrastructure. We will set out two big reforms to provide dignity in old age: an improved state pension that rewards saving; and more help with the costs of long-term care.”

Cameron indicated in a Sunday Telegraph newspaper interview yesterday he’d like to stay in office another seven years, even as opinion polls suggest the Conservatives may lose power in 2015. As that election approaches, he and Clegg will increasingly campaign for their separate parties, rather than pushing joint policies.

Savings Pledge

The first chapter of the document, dealing with the economy, doesn’t mention the government’s announcement last month that it’ll miss its target of starting to reduce debt by 2015 and take until 2018 to eradicate the structural deficit. It pledges to increase central government savings to 20 billion pounds ($32 billion) annually from 8 billion pound at present by 2015. The government will aim to give a quarter of its businesses to small and medium-sized employers by that date too.

Relations between the coalition parties hit a low in July after a rebellion by Tory lawmakers over an overhaul of the upper House of Lords sparked retaliation by the Liberal Democrats, derailing changes to electoral boundaries that would have benefited the Conservatives.

An overhaul of the welfare system and Britain’s relationship with the European Union have also divided the coalition. The publication of today’s document was delayed for six months as the parties sought common ground.

‘Own Vision’

“We’re certainly going to be fighting the next general election on our separate manifestos, just as all coalition parties always do,” David Laws, a Liberal Democrat minister who was part of the original coalition negotiations, told BBC Radio 4’s “Today” program. “We’ll be presenting our own vision to the public of where we want to see the country go in the future.” Laws said the government had made “massive progress” in cutting a budget deficit that stood at almost 160 billion pounds ($257 billion) when it took office.

An opinion poll in the Mail on Sunday newspaper yesterday showed the Labour opposition with 38 percent support, the Conservatives with 29 percent and the Liberal Democrats with 11 percent. The Survation polling company, which questioned 1,002 people on Jan. 3 and Jan. 4, said 16 percent of respondents expressed support for the U.K. Independence Party, which seeks to pull Britain out of the EU. Such a result in 2015 would hand Labour a majority in the House of Commons.

‘Other Threads’

Cabinet minister Thomas Strathclyde quit today as the Tory leader of the House of Lords, citing 25 years of front-line political service and saying in his resignation letter to Cameron that he would like, “while there is still time, to take up other threads of my life and other interests.”

Labour mocked the timing of the resignation on the day of the mid-term review. Jonathan Hill, an education minister who reportedly tried to quit last year but was ignored by a distracted Cameron and remained in post, replaces Strathclyde.

“You replace a Cabinet minister with one who tried to quit and then announce it on the day of your relaunch -- the incompetence is staggering,” Labour’s business spokesman, Chuka Umunna, said on Twitter.

Cameron is under pressure from Tory lawmakers angry their views are being subordinated to policies favored by Clegg’s party for the sake of keeping the coalition together.

And remaining in power is not a foregone conclusion for Cameron, even if he does win the election outright in 2015. Labour Prime Minister Tony Blair vowed to serve a full third term in office before pressure from his own lawmakers saw him quit in 2007 in favor of Gordon Brown, three years before an election had to be called.

Credit Rating

Yesterday, Cameron predicted a difficult year for the economy that will require maintaining the current mix of low interest rates and deficit reduction.

Convincing investors that they should keep buying U.K. bonds is ultimately more important than whether ratings companies downgrade gilts, he said. Standard & Poor’s lowered its outlook on Britain’s top credit rating last month to negative, citing weak growth and a worsening debt profile.

“We are dealing with the deficit, rebuilding the economy, reforming welfare and education and supporting hard-working families through tough times,” Cameron and Clegg wrote in the document published today. “On all of these key aims, our parties, after 32 months of coalition, remain steadfast and united.”

“Of course there have been some issues on which we have not seen eye to eye, and no doubt there will be more,” they wrote. “But on the things that matter most -- the big structural reforms needed to secure our country’s long-term future -- our resolve and sense of shared purpose have, if anything, grown over time.”

The coalition was formed in May 2010, with the two men giving a news conference in the rose garden at Cameron’s London office in Downing Street.

‘Giggly Newlyweds’

Comparing them back then to “giggly newlyweds,” Labour Vice-Chairman Michael Dugher wrote on the Politics Home website yesterday that “the happy couple will this week reaffirm their vows. But no amount of relaunching can obscure the reality of the impact of their time in office.”

“They said they’d fix the economy,” Dugher said in an e- mail. “But living standards are still falling for the hard- working majority whilst a handful of millionaires get huge tax cuts. They said they’d fix welfare, but the welfare bill has gone up not down.”

To contact the reporters on this story: Kitty Donaldson in London at kdonaldson1@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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