William Wallace: Judge us over fve years and not by each controversy

No-one wants to pay higher taxes to make up the shortfall. But the Government has no alternative to making hard choices about spending priorities and where taxes should rise.

Liberal Democrats, in national government for the first time in a lifetime, have felt the pain of hard choices to make. We would like to have gone into government when the economy was growing well, when public investment could have been increased and education spending raised for everyone between the age of two and 21. We have found ourselves in coalition with the Conservatives, facing a global financial storm which has nearly wrecked the Irish economy and might have severely damaged the British as well.

If you're doubtful about the rationale for this coalition Government, ask yourself what the alternatives, after an indecisive election result, would have been?

A minority Conservative government would have taken office with a much stronger commitment to public spending cuts, but without the ability to carry any spending programme through Parliament.

A minority Labour-Liberal Democrat government would have wished to pursue a more generous economic strategy, but would have had little chance to do so; never forget that Labour was planning 20 per cent public spending cuts before the election.

Whichever government had emerged, it would have staggered through the summer and early autumn, with international financial markets beginning to bet against the pound; and stumbled into a second election, against the background of worsening economic confidence. If you are old enough to remember the two elections of 1974, you will remember how much the British economy and political system suffered from those long months of uncertainty.

Co-operation between two parties in government, in peacetime, doesn't fit with the dominant narrative of British national politics. In Scotland and Wales and on local authorities throughout the country, co-operation among parties in joint administrations has become accepted practice; political leaders negotiate with each other daily, striking hard bargains and seeking acceptable compromises.

In Westminster, the story is still about politics as all or nothing, we versus them, everything we demand against all that they refuse to give us. Coalition government sees political choices in terms of more or less, not all or nothing. Shared government between the Liberal Democrats and the Conservatives is a business arrangement to provide Britain with effective government under difficult conditions – not a marriage or merger.

To govern is to choose. Students on the street demand free higher education without saying who else should pay, or what other programmes should be cut instead. Some, rightly, are targeting the banks and companies which run complex schemes to avoid UK tax, as a partial answer; but the extra revenue would not fill the gap.

Labour, back in opposition, is torn between attacking everything the government does and admitting that they were the government that introduced graduate contributions to higher education, and that they had set up the review which has sparked the current changes.

If the economy had continued to grow at two to three per cent a year through 2009-10, we could have afforded to plan for a long-term phase-out of tuition fees, and would have bargained with our Conservative partners to give this a higher priority than the defence spending to which they were committed, and the prison-building programme which many of them wanted. They have had to cut back their demands, faced with the constraints of recession, and so have we.

We chose to protect education spending on younger children, and to push for a university funding scheme which helped part-time students and gave more protection to disadvantaged students and low-paid graduates.

It's much easier to be in opposition than in government – as a former Labour minister recently remarked. We are negotiating within the coalition to protect long-term investment in railways, social housing and schools from the financial squeeze. But there are limits to what government can provide, and limits also to what the public is willing to pay in higher taxes.

Judge us by what we achieve through stable government over five years, not by each critical moment.

Lord Wallace of saltaire is a Lib Dem peer, and government whip.