Can Clegg and Cameron patch up coalition cracks?

Six months after bonding in the Rose Garden, the Conservative-Lib Dem government is feeling the strain as the reality of power and the need to compromise bites. Matt Chorley assesses how deep the fissures run

"We are in a bloody coalition," says an exasperated senior Lib Dem. "We cannot get all of our policies. We have just got to stand there and take the hit."

And they have, down to nine points in one opinion poll. As the coalition marks its first six months this week, those at the top cling to the memories of their Rose Garden political marriage like newly-weds refusing to tip the sand from the honeymoon suitcase. Now the hard graft of living together has begun, with ill-feeling fuelled by suspicions of vanity, differing ambitions and one partner trying to change the other.

Just as the parties are trying to prove how united they are, along comes the by-election to replace disgraced Phil Woolas in Oldham East and Saddleworth, where we will get our first taste of coalition partners slugging it out on the streets of a three-way marginal.

Conservatives are uneasy about the apparent swing leftwards over penal policy, defence and Europe. As one veteran Tory backbencher puts it, "there is too much Liberal and not enough Conservative" in the LibCon coalition. Meanwhile, Lib Dems look on in horror as tuition fees rise and their Tory partners whoop at cuts in welfare for the poorest. "The cracks are definitely emerging," said a Lib Dem minister. "We are starting to realise that the honeymoon is over and we don't agree on everything, and never will."

Senior Lib Dems take heart from the fact that even with polls showing them to be at "rock bottom, people are still pleasant to us in the street". That may be about to change.

Tuition fees

More than 20,000 students are expected to take to the streets of London on Wednesday when Aaron Porter, the president of the National Union of Students, will issue a stark warning to Lib Dem MPs who vote in favour of fees rising from £3,290 to as much as £9,000 a year from 2012. They will be targeted by a student-led "decapitation strategy", with halls of residence mobilised to oust MPs who break their pledge "to vote against any increase in fees in the next parliament and to pressure the Government to introduce a fairer alternative".

It is understood that as well as increasing the pressure in Nick Clegg's Sheffield Hallam seat, Mr Porter will announce that other Lib Dems in the line of fire will include Don Foster (Bath), Stephen Williams (Bristol West) and Simon Wright (Norwich South). "What we are doing is holding politicians to account for the things that they said and, in truth, they face the consequence of not being re-elected," Mr Porter said.

Mr Clegg's aides insist they are relaxed about speculation of high-level resignations over tuition fees, though the Home Office minister Lynne Featherstone revealed she is still weighing up her options, and the former Lib Dem leader Sir Menzies Campbell has insisted he will vote against, with as many as 25 potential rebels in the Lib Dem ranks.

In a podcast yesterday, Mr Clegg admitted his policy to scrap tuition fees had fallen victim to "the compromises of coalition government" but insisted the new package – including a £150m National Scholarship Scheme and raising the payback threshold from £15,000 to £21,000 – would "promote social mobility rather than entrench inequality".

Ministers will hold further talks with MPs this week in an attempt to avert a large-scale revolt. Meanwhile, The Independent on Sunday understands that Labour will oppose the policy's "central idea" which they claim amounts a two-thirds cut to public funding for teaching in higher education. The move forms a major strand of the Labour leader's strategy to drive a wedge between discontented Liberal Democrat backbenchers and ministers.

Welfare

The get-tough message from Iain Duncan Smith, the Secretary of State for Work and Pensions, aimed at the jobless and feckless has pleased the traditional Tory right, but the detail of plans to cut state help, including housing benefit, and impose time limits on other handouts has alarmed Lib Dems, and presented Labour with the chance to exploit divisions in the coalition.

Andrew George, a senior Lib Dem backbencher, will use a debate on Tuesday to warn the coalition's spending plans "do not protect the vulnerable" and cuts to housing benefit "look as if they will place some of the most vulnerable in our society at the highest risk".

The latest wheeze to be announced this week will be a plan to compel "the idle" to attend courses preparing them for the world of work. Jobseekers will be expected to spend 30 hours or more every week for four weeks to give them an "extra push" towards getting paid employment.

Almost 1.5 million people have been receiving out-of-work benefits for nine out of the past 10 years. A source said: "The goal is to break into the habit of worklessness." It is part of a welfare reform White Paper that will set out plans for a Universal Credit, combining existing unemployment benefits into one payment.

But writing in the IoS today, Douglas Alexander, the Shadow Work and Pensions Secretary, warns: "My real fear is that in contrast to [Labour's] record of progress, the new Conservative government, like previous Conservative governments, will prove much better at cutting benefits than getting people into work."

Europe

A budget increase, a defence treaty with the French, votes for prisoners – no wonder the Eurosceptics have rediscovered their voice, and just as the charismatic bon vivant Nigel Farage returns for a second stint as leader of the UK Independence Party.

"There are millions of historically Eurosceptic Tory voters who will be utterly shocked and appalled at the direction of this Conservative-led coalition," Mr Farage told the IoS, claiming Mr Cameron was leading the "most Europhile Tory party since Edward Heath".

Mr Farage also made a direct appeal to Conservative Eurosceptics to defect to UKIP. "I regard them as friends, people like Philip Hollobone and Philip Davies, but frankly they are impotent, and what they ought to do, even given the vagaries of our voting system, is come and join UKIP."

The row over votes for prisoners fuelled tensions over relations with the Continent, as many right-wingers casually (and wrongly) confused the European Court of Human Rights, which made the ruling, with the European Union. Mr Cameron said the ruling left him feeling "physically ill", but left-wing Lib Dems remarked that: "How we treat our prisoners is an important mark of how civilised a society we have."

Brian Binley, a veteran Tory, is leading a cross-party group opposing the plan. He said: "From the Government we are seeing fine words but I don't think we are seeing action of the required order."

Civil liberties

The Home Office will this week drop plans to give anonymity to rape defendants, in the face of criticism from all sides. The proposal surfaced in the coalition agreement, but no one could be sure from where it originated. Many Tories were suspicious of their Lib Dem partners.

Lib Dem MPs hoping for similar U-turns on control orders for terror suspects and the proposal to store email and phone records are likely to be disappointed. Stephen Gilbert echoes the thoughts of many of his colleagues: "From a libertarian perspective, it will take a lot of persuading to get me to support this."

Arms will be twisted and deals will be done. All governments have internal tensions. No one is saying, as they did in the early days, that the coalition will not last, just that the hard reality of a long political slog is only just beginning to dawn.

The ace of spads

He always promised that this Government would not have the same number of "hangers-on" as Gordon Brown's, and David Cameron has been as good as his word. However, despite a repeated pledge to "put a limit on the number of special advisers", the Cabinet is employing more "spads" than Mr Brown's administration.

The Prime Minister was publicly embarrassed by the revelation that his former personal photographer, Andy Parsons, is now paid by the taxpayer. But the revelation was the tip of the iceberg.

Nicky Woodhouse, the film-maker behind the "WebCameron" operation, last week began making films for the Government. Mr Cameron also brought his "personal stylist" over from Conservative HQ. Anna-Maren Ashford, formerly Tory "head of brand communications", is now in the Cabinet Office – where the party's ex-head of digital strategy, Rishi Saha, is deputy director of digital communications. The new employees are on short-term contracts, meaning they avoided a more stringent selection process.

The Lib Dems have also used the tactic, moving Tim Snowball – formerly Nick Clegg's campaign tour organiser – into the Deputy Prime Minister's office as a private secretary. Mr Clegg's former deputy speech-writer, Zena Elmahrouki, has also turned up in the Cabinet Office.

The appointments have attracted criticism from allies and opponents.

The Labour MP Michael Dugher said: "When half a million people are going to lose their jobs from the public sector, David Cameron thinks it's right to use tax-payers' money to fund a personal vanity photographer and a personal film-maker."

Brian Brady

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