by Gordon Brown
But that is not how Nick Clegg saw it. Before the election, Clegg had said he would talk first to the biggest party. He maintained this was what the constitution mandated. In 2010, this appeared to be the Cabinet Secretary Gus O’Donnell’s view too (he included a reference to it in a new edition of his Cabinet Manuel in 2010), although he has since qualified it. I did not object at the time – Nick Clegg was, of course, entitled to talk to anyone he wanted – but few constitutional observers agree that he was following any clear principle. Others had done it differently in the past. It was, rather, his personal preference.
It should have been inconceivable that the Liberal Democrats would prop up an austerity regime. It went against every economic position they had adopted during the campaign. While the Tories had fought on a programme of spending cuts, the Lib Dems had pledged an extra £5 billion of expenditure a year. ‘If spending is cut too soon,’ their manifesto said, ‘it would undermine the much-needed recovery and cost jobs.’ This was a stark rejection of austerity. Their manifesto also explicitly rejected immediate expenditure cuts for the first year after the election. The Lib Dems had a similar commitment to Labour’s to prioritise growth and a similar target to ours for borrowing in each year – in all of these areas their manifesto placed them a million miles away from the Conservatives. I thought that in any coalition negotiations it would not be difficult to reach agreement with the Lib Dems on the economy.
They also had more in common with us than the Conservatives on what they proclaimed to be their make-or-break constitutional issue – voting reform. I had come out for an alternative vote system and could provide assurances of good faith. They wanted Lords reform and I was committed to that. They wanted a climate change policy that could reopen the drive for a global treaty, despite the breakdown of talks in Copenhagen, something I was campaigning for too.
The other main issue was Europe. The Conservatives had promised to tear up EU social and employment legislation and their campaign had strong anti-European rhetoric. Once again, on a defining issue, the Lib Dems and Tories were entirely at odds with each other.
It was clear that across the whole field of government policy there was potential for agreement between Labour and Liberal Democrats on a progressive programme. However, we had to reckon with a party that was bruised from a result that fell far short of their expectations. At 23 per cent of the vote – about the same as in 2005 – the Lib Dems had failed to make the breakthrough they had confidently assumed. They were down five seats on their 2005 performance, when they had won sixty-two. For every five seats held by Labour, the Lib Dems held only one. Their campaign manager Danny Alexander, who spoke to Andrew Adonis on the morning after the election, confirmed that they were licking their wounds.
On election night, many believed that the Liberal Democrats were about to be installed as the second party in British politics. But the next morning they were 200 seats short of that dream. When the next day I spoke to Alan Rusbridger, the editor of the Guardian, who had supported the Lib Dems, I urged upon him the logic of supporting a progressive coalition. However, it soon became obvious that Nick Clegg had only one real objective in mind: forming a coalition with David Cameron. A good indication of this came when Paddy Ashdown, who seemed to be at the centre of every manoeuvre, cancelled a meeting that Andrew Adonis had previously arranged with him for Friday morning.
At 1.45 p.m. on Friday, before David Cameron was due to speak, I made my statement. I had consulted as many members of the Cabinet as I could beforehand – while at the same time trying to contact some of our candidates who had sadly lost their seats to thank them for their efforts and commiserate. There was an attempt to ban me from speaking from outside No. 10. I replied that this was both my home and my office. As a compromise, I made a statement at a modest distance from the black door of No. 10. I was told a suitable lectern – one without the government crest – could not be found, which meant I had to speak from a rickety one that had been located somewhere in the basement.
‘For my part,’ I said, ‘I should make it clear that I would be willing to see any of the party leaders.’ I then emphasised that we needed ‘strong, stable and principled government’. The word ‘principled’ was carefully chosen to highlight the decisive questions. Would the Lib Dems join in government with a party that was so virulently anti-European? Would they sacrifice voting reform for a hollow Conservative promise? Most of all, would the Lib Dems hold to the principled commitment in their election manifesto to oppose austerity? I was sending an unmistakable message about the incompatibility between the Lib Dems’ pledges and the Conservatives’ programme.
When he spoke forty-five minutes later, David Cameron offered Clegg a full coalition. This too represented an opening for us: by accepting the need for coalition negotiations, he had declined to claim a right to govern, legitimising the entire process of talks and by implication our involvement in them. But, of course, all depended on the Liberal Democrats. Their decisions over the next few days were to have historic significance for progressive politics.
At 5 p.m. on Friday, I spoke to Nick Clegg, congratulated him on his campaign and told him there was genuine common ground on which we might forge an agreement. To show our good faith, I said I would share a policy paper with him – one we had prepared for internal consumption – and proposed that we meet soon.
The next day at noon I attended a ceremony at the Cenotaph to commemorate the sixty-fifth anniversary of VE Day. Rather unusually, at Gus O’Donnell’s insistence, David Cameron and Nick Clegg were given equal billing with the sitting prime minister. This incident and the Sun’s front-page headline that morning – ‘Squatter holed up in No. 10’ – brought home how easily it might appear I was clinging on to power. Being alert to this possibility, I had already decided on Friday to leave London for Scotland. Early on the Saturday afternoon, Sarah and I left to fly home to my constituency.
Back in Scotland, I again talked to Clegg by phone. My message to him was that David Cameron could not deflect his party from its anti-European stance, even if he wanted to. If they reached agreement with the Tories, the Liberal Democrats would be going into coalition with a party that held exactly the opposite view to them. I re-emphasised that the Lib Dems and Tories had irreconcilable policies on the economy as well. But when it came to the crunch, as I found, even the rancid anti-Europeanism of the Tories did not deter him. In all our private talks, I felt that I was far more concerned than he was about the UK becoming isolated in Europe. To me, he gave the impression that he had hardly thought about this.
That same day, Nick Clegg had been approached by some leading Lib Dems asking him to reconsider his attitude to Labour and to seriously contemplate a Labour–Liberal coalition. There was certainly scope for agreement. Andrew Adonis, who has chronicled the events of these few days, concludes that ‘there could have been a radically different dynamic, leading to a Lib-Lab coalition, had Clegg instead said the day after the election that the key issue had been economic policy’. So why did the Liberal Democrats go into the election on an anti-austerity manifesto but into a coalition government on an austerity platform? Why did they U-turn on their earlier commitment to forswear cuts before mid-2011?
Such an arrangement would have been all but unthinkable until Nick Clegg became leader of the Liberal Democrats. I believe he was personally more comfortable with Conservatives. In the event, the assurances he secured from them were paper-thin: the Conservatives gave him his referendum on changing the voting system but then sabotaged it – and, in the end, it was Tory votes in Parliament that killed off Lords reform. Nick Clegg’s later rationalisation that the Lib Dems moderated right-wing policies by entering a coalition with the Conservatives is an early example of fake news: if Labour and the Liberal Democrats had gone into coalition together there would have been no shift to the right in the first place.
But the ultimate rationalisation for a Tory-led coalition – which turned the Lib Dems’ own self-declared policies and progressiv
e principles upside down – was a convenient post-election conversion to austerity. The Liberal Democrats signed up to Tory economics and their later fiasco over tuition fees was the inevitable outcome of their surrender.
David Laws, one of the leaders of the Lib Dems’ negotiating team, was far more upfront than Clegg on this matter. Published in 2004, Laws’ work The Orange Book had been a thinly veiled attempt to shift the party to neoliberal economics. But Clegg and Laws were given cover. As Vince Cable has written, the Lib Dems found themselves under pressure from more than just the Tories to adopt their plan to reduce spending by £6 billion. He explained the pressures: ‘This sense of urgency and importance was enhanced by the personal briefings I and others received by phone during the coalition negotiations from the Cabinet Secretary [Gus O’Donnell] and the permanent secretary to the Treasury [Nick Macpherson], reflecting, at one removed, the views of the governor of the Bank of England [Mervyn King].’ And he went on: ‘The formation of the coalition coincided with the first major crisis of confidence in Greek government bonds and the euro. The government’s top officials expressed the fear that, as the country most exposed to a banking crisis and with the largest fiscal deficit of any major country, the “contagion” could easily spread to the UK.’
This was thorough nonsense. There was no chance of the UK going the same way as Greece. Our deficit was lower than that of the USA, our debt at around the same level as Germany’s and lower than our major competitors. It was simply wrong to say the deficit could not be funded. The argument that it would be difficult to sell British government bonds would prove to be completely incorrect.
On Friday 7 May, in his discussions with the Liberal Democrats, George Osborne now claimed that the Bank of England and the Treasury shared the position that £6 billion of immediate spending cuts were needed to send a powerful message to the markets. Laws records Osborne saying that Mervyn King and Nick Macpherson were ‘very supportive of what we want to do’. The draft Tory–Liberal Democrat agreement, prepared on 8 May by the Conservatives, laid bare what was happening: ‘The Conservatives explained our [i.e. the Conservatives’ and the Liberal Democrats’] belief that the achievement of a further spending reduction of £6bn in 2010 would be regarded by the financial markets as a test of whether a Conservative–Liberal Democrat government was capable of carrying through the necessary deficit reduction plan. This view is shared by the Treasury and the Bank of England.’
These statements of official support were never corrected; indeed, Laws also reports that William Hague and George Osborne, two of the lead Tory negotiators, claimed authority from Nick Macpherson and Mervyn King to offer meetings with them during the negotiating period.
The newspapers contained reports that the Bank and Civil Service had endorsed the Tory austerity plan. There was even a report that there would be a meltdown on Monday unless austerity was agreed. Back in London on the Sunday, I called Mervyn King at around 7.15 p.m. He was evasive; it was clear, though, that his views had been communicated to the other parties. This all suited Nick Clegg’s position. It is important to remember that the Lib Dems needed the consent of a three-quarters’ majority of their party group and a conference vote to enter a coalition government. It was thus to Clegg’s advantage to create the illusion of a national economic emergency to persuade his party that they must accept austerity in the national interest.
On Sunday, Vernon Bogdanor, our leading constitutional scholar, reminded me that under the constitution I had the right to present a Queen’s Speech – and in the New Statesman later that week he proposed a progressive alliance. After having fought so hard to achieve economic recovery and sensing it was in danger, I decided to make one last effort. I considered a public appeal. With help from Kirsty McNeill, who was writing speeches of the highest quality, I planned to say that ‘last Thursday, 15 million people voted for progressive parties – and it will be to my lasting regret that I could not win enough of them for Labour’. I then would have gone on to say: ‘The British people cast their ballots for progressive commitments on public services, the economy and the environment … [this] is now an urgent dividing line in our public life.’
But I settled for the more mundane. I met Nick Clegg at 4.15 p.m. in the Foreign Office after an elaborate series of walks in underground tunnels to prevent the press knowing of our meeting. Before that I talked to Vince Cable by phone. While more favourable to Labour, Cable spoke as though he had been excluded from the main Lib Dem team and seemed unable to influence events. My exchange of views with Clegg was entirely amicable. I told him that to expedite a deal I was prepared to stand down as prime minister; moreover, before I did so, I would throw the Labour Party’s weight not just behind a referendum on the alternative voting system but behind a ‘yes’ vote. But there was not much good faith around: while I had offered to leave as Labour leader, the Lib Dems briefed that I had said the opposite.
I followed up the Clegg meeting with further calls to Vince Cable and Menzies Campbell. In a letter sent to Clegg – prefaced by a phone call on Monday morning around 8.15 a.m. – I said we needed a clear statement of principles and a governing philosophy. I told him we could sign up to a new democratic and constitutional settlement and to far-reaching changes to our economy and banking system. I ended by saying that all the decisions the new government made would be taken on the basis of a pro-European agenda.
At 10.45 a.m., I then met Nick Clegg in the House of Commons, with Peter Mandelson and Danny Alexander present. It soon became apparent that the talks between Labour and Liberal Democrats had yielded little. But there was an air of unreality about the encounter: Danny Alexander seemed to think he was there to be the ‘hard man’ and quickly demanded that I resign immediately. I repeated that I was leaving but that I needed to get the coalition agreement through the Labour Party and that we had to create momentum within it to win a referendum on voting reform. This, I reminded him, would not happen without backing from the top. If I resigned immediately, the Queen would have no choice but to ask the Conservatives to form a government. It was becoming abundantly clear to me that Nick Clegg was using the meeting for ammunition to strengthen his negotiating position with the Conservatives.
Following this, at 5 p.m., I made a statement saying I had asked the Labour Party to begin a leadership selection process in which I would take no part. My intention would be to step down by September. I had no desire to stay in my position longer than was needed. However, I made clear that it was in the ‘interests of the whole country to form a progressive coalition government’, leaving open the prospect of Labour–Liberal coalition, following further formal discussions with Clegg.
All the time I was having to talk to MPs, party officials and Cabinet ministers, explaining that we had put to the Lib Dems a progressive agenda for government. When the Cabinet met after my public statement – the first time since the election and the last time it would come together – there was some pushback from one or two ministers who thought it best to rebuild Labour from the Opposition benches – and some criticism of who was in and out of our negotiating team. But the Cabinet gave me a free hand to reach a conclusion.
By Tuesday morning, I had made up my mind that, unless the Lib Dems were genuinely interested in reaching an agreement with us, I would hand in my resignation as prime minister that day. I had one last meeting with Nick Clegg at 1 p.m., talked to Paddy Ashdown, Menzies Campbell and Vince Cable, when I kept emphasising to them that a pact with the Conservatives would legitimise the austerity agenda and anti-Europeanism of the Tory Party – both of which they had opposed vehemently during the election. But when at 3 p.m. I met with our own negotiating team – Ed Balls, Ed Miliband, Peter Mandelson, Harriet Harman and Andrew Adonis – it was clear that the Liberal Democrats were unprepared to enter into meaningful negotiations. I then talked separately with Harriet and gave her an assurance that I would resign as leader with immediate effect and that she could take over as acting leader. Following this, I signalled to Sarah tha
t we would be leaving for good within an hour or two. All the time, Kirsty McNeill and I were working on the resignation speech to be given from outside No. 10.
At 6.50 p.m., I phoned Nick Clegg to tell him I was stepping down. He asked for a few minutes to consult, but it was clear to me the extra time he wanted was only to wring some concessions out of the Tories. Anyway, I wanted to leave Downing Street as prime minister for the last time in the light of day. I informed him in a phone call at 7 p.m. that I would be handing in my resignation within the hour. Again, he asked for more time. I refused: I told him the time for talking was over and wished him well. However, I clearly remember warning him of two things as we conducted these conversations: the Tories will destroy you, I said, and they will pull us all apart on Europe.
I had already arranged to go to the Palace before I went out to make my public statement. Before leaving, I thanked the staff at Downing Street for their professionalism and total commitment to public service. And then at 7.15 p.m., while it was still light, I made a public statement outside No. 10 with Sarah and our two boys by our side.
Sarah wanted all four of us to leave Downing Street together as a family. As I have written, we had never wanted the boys to be in the public eye; we wanted them to have lives that were as normal as possible. But for this one occasion we decided that all four of us should walk out the door of No. 10 together and then walk side by side down the street. John and Fraser had to know that something was changing in their lives and they would never live there again. They needed to know there was a reason they were leaving the only rooms and beds they could remember. In a youthful assertion of independence, John was insistent he would not wear a shirt and tie but a favourite T-shirt; after he and Fraser had been told of their roles, both behaved as if out for a normal evening walk.