Lib Deb unease understandable but choices were and are limited

AFTER one of the most momentous weeks in UK politics it cannot be a surprise that many grassroots Liberal Democrats should feel uneasy about the extraordinary coalition deal that has emerged. Vociferous opposition has emerged and two former leaders have expressed reservations. Lord Ashdown has made clear his preference for a coalition with Labour, while Charles Kennedy abstained from the vote on the deal and has voiced his dismay.

Does this mark a serious threat to the deal and a serious rift within the party? It is important to keep opposition to the deal in perspective. Yesterday a special conference of 2,000 Lib Dems voted overwhelmingly to back the coalition deal struck by Nick Clegg. That by no means marks the end of debate, but it signals the extent to which events have driven two historically distinct parties into quite unfamiliar terrain. No-one expects them to cease developing new ideas and from fighting each other in by-elections. Equally, however, there is an onus on senior Liberal Democrat figures such as Mr Kennedy to recognise both the seriousness of the financial crisis we now face and the changed political realities that became clear last week.

Many Lib Dems will feel uneasy that they have not gone into coalition with Labour as "natural" allies. But no workable deal with Labour was in prospect. And there were many senior Labour voices who made clear their view that an attempt to remain in office would not have been acceptable to the electorate. The alternative the Lib Dems faced was coalition with the party that had obtained the most votes and most seats, or a withdrawal to the sidelines which would almost certainly have triggered a political crisis and another general election almost immediately.

Whichever path the Lib Dems chose would have led back sooner or later to the gaping chasm in the UK's finances. Centre Left politicians have typically relied on ever higher government spending. But the UK is no longer in a position to afford this. "Progressive" politics now has to be about more than raising public spending.

If the scale of the officially declared deficit and debt numbers was not enough, there is now the prospect that the numbers may be even worse than so far admitted. Treasury mandarin Sir Alan Budd, head of the new Office for Budget Responsibility, has already started work on a review of the "real" numbers. While lower than expected unemployment should help the numbers short term, the OBR is expected to take a wider view of public debts, adding, for example, future Public Finance Initiative obligations to the official debt totals.

These liabilities have been excluded from official debt totals, showing a degree of off balance sheet accounting creativity of the type that helped bring the banking system to its knees. Faced with numbers like these, the coalition has an enormous task ahead – around which responsible politicians from both parties now need to unite. There is no realistic alternative.