William Wallace: The voters have demanded this new style of government

NO party won the General Election. Voters sent politicians some mixed messages: low trust for any party, dislike for the whole Westminster style of politics and a strong preference for politicians who work together rather than attack each other. The outcome of several days of discussion among the three major parties was not what any of us expected at the outset. But it does respond to what voters demanded: it's an attempt to create a new style of government.

The idea that single-party government is the only way to provide stable policy-making is one of the myths of the British constitution. Disraeli's remark that "the English do not love coalitions" is repeated without any consideration of the loose parties and changing affiliations of the 19th century. The reality, across Europe, is that coalition government has provided effective economic management in Holland, Germany, and the Nordic countries, while single-party governments have almost wrecked the Greek economy.

Coalitions have to consider decisions before ministers rush to the Press to announce them. They have to carry their parties with them – and in the process they stand a better chance of carrying the public with them as well.

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Compromise is a virtue in democratic politics, and building a consensus among different parties is far better than the confrontations between government and opposition which have alienated so many voters. A fairer voting system would reflect the diversity of voters' preferences and values, and require a search for common ground. We intend to demonstrate that multi-party government provides stable government, so reinforcing the case for electoral reform.

The agreement both Liberal Democrats and Conservatives signed up to last week pushes through political reforms that Labour had failed to pursue over 13 years. Parliament will have more control over its own business, so that the Prime Minister will find it harder to push through ill-considered ideas – as Mrs Thatcher did with the poll tax, and Tony Blair did with a whole succession of changes in criminal law. Reform of the Lords will at last move forward. Concentration of power over local authorities in Whitehall will be reversed.

Liberal Democrats are instinctively progressive. But there isn't a simple and one-dimensional Left-Right spectrum in British politics. New Labour in office was authoritarian and centralising, and deeply conservative about political reform. It was disappointing on energy conservation and climate change. It preferred benefits to tax cuts to help the lower-paid, and still the gap between rich and poor continued to widen. The agreement we have struck is stronger on civil liberties than Labour was willing to contemplate. It also goes further on tackling the threat of climate change, and creating new jobs in energy conservation.

The reaction of people like David Blunkett to the new Government shows that the old tribalism of Left and Right remains strong. But the image of Labour as the champion of the working class and Conservatives as the party of privilege – with no room for any other perspectives – no longer makes sense to many voters. Nor does it reflect what governments do in office. Under Blair and Brown, Labour pushed through the private finance initiative, spent huge sums on private consultants, widened the gap between top salaries and the lower paid across the public services, and gave unconditional support to the City of London. Boris Johnson, the Conservative Mayor of London, has just taken Underground contracts back under public control, reversing the privatisation that Labour forced through.

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Liberal Democrats were open to co-operation with either of the other two parties, to provide Britain with stable government after this inconclusive election. We were surprised and disappointed that Labour seemed less willing to compromise, and that senior figures in their party began denouncing co-operation while discussions were under way. Equally to our surprise, David Cameron's team were willing to move a long way to meet the priorities we had spelled out in our campaign. We have consulted our party throughout the negotiations, and agreement was approved by a special party conference yesterday.

One of the difficulties of working with Labour, given the figures needed for a secure Commons majority, was that it would have laid a Lib-Lab coalition open to pressure from Welsh, Scottish and Ulster MPs to protect their share of public spending at the expense of the English regions. Liberal Democrats, with a leader who is a Sheffield MP, know well the importance of promoting economic regeneration in northern England, and ensuring that a Conservative leadership overwhelmingly drawn from southern England does not neglect our specific needs.

Shared government is not going to be easy. Britain faces a crisis in public indebtedness. That will force hard choices in public spending and taxation which both parties will have to tackle – and explain to the public. There

remain major differences of approach between the partners – on foreign policy and defence in particular. But the greatest challenge for this new style of government is to rebuild public trust in British politics.

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