Andrew Grice: Nick Clegg insists the Coalition can be frugal and fair. We shall see ...

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"Good luck. Carry on cutting with care," David Laws wrote in a note to his successor Danny Alexander when he resigned as Treasury Chief Secretary in May.

In the eyes of some Conservative ministers, the two Liberal Democrats have been cutting with remarkable enthusiasm too. Nick Clegg has set the bar high for the Government-wide spending review, talking up the prospect of "progressive cuts" and repeatedly promising that the Coalition would not repeat the savagery of the Thatcher era by hitting the most vulnerable the hardest.

The Deputy Prime Minister was at it again yesterday, announcing a morsel of good news – a £7bn, four-year package to help disadvantaged children – which would otherwise have been buried in the avalanche of bad news that George Osborne will set rolling in his comprehensive spending review on Wednesday.

"We will not balance the books on the backs of the poor," an upbeat Mr Clegg said in a speech at a Chesterfield junior school. He promised that by the end of the four-year period covered by the review, £2.5bn a year would be spent on a "pupil premium" to enable schools to give extra help to every pupil eligible for free school meals, £300m a year on pre-school education for two-year-olds, and £150m a year on helping bright children from poor backgrounds to go to university.

The Liberal Democrat leader fought hard to squeeze extra money out of the Treasury at a time when it is demanding more for less. But we should wait and see the education settlement as a whole before getting too carried away. The education budget is not protected like the NHS and could be cut by 10 per cent.

Mr Clegg used the word "fairness" 34 times in his 21-minute speech. It is the latest political buzzword. Mind you, I have yet to meet a politician who is against "fairness". I suspect such rhetoric leaves many voters rather cold. When Labour used the slogan "a future fair for all" before the May election, the party's polling showed that some people wondered why it kept banging on about a funfair.

So how you achieve the "long term fairness" Mr Clegg promises to "hard wire" into the system while you are imposing cuts of £83bn? The only option is to spread the pain. "If everyone is throwing rocks at us, we are OK," David Cameron told his Cabinet recently. "We need people to feel they are all in this together."

Mr Clegg's announcement yesterday complemented the decision to axe child benefit for top rate taxpayers. And yet there are bound to be accusations that the poor are being hit hardest because further benefit cuts are inevitable on Wednesday.

Ministers are not losing as much sleep as you might think about the raft of headlines accusing them of clobbering the middle classes. "If people don't think everyone is doing their bit, we are fucked," one admitted yesterday.

Their other challenge is to answer the "Why now?" question. The Coalition has won the argument on the need to tackle the £155bn deficit. It has also succeeded in pinning the blame for the mess on Labour, which has failed to convince people it is all due to the global recession. But private polling discussed by ministers shows that the voters are not convinced about the need to cut so quickly.

It's no surprise. We shouldn't forget that the Liberal Democrats fought the May election on a platform of opposing cuts in this financial year. So 52 per cent of voters (the combined share of Labour and the Liberal Democrats) opposed early cuts while 36 per cent voted for the Tories, the only major party that advocated them.

The same research suggests that voters are open to persuasion about the need to act quickly when told about the need to stop the nation's £43bn-a-year interest bill from spiralling. So ministers are pointing out that interest payments alone could build a primary school every hour or buy a Chinook helicopter every day.

They will stress that they are cutting through necessity, not a desire to slim the state, and are only reducing services and benefits as a last resort. "We have got to show that we left no stone unturned," Mr Cameron told the Cabinet. Hence the squeeze on public sector pay and pensions and the pre-emptive strike against quangos, although the latter proved rather more difficult in practice than the headline-grabbing cull the Tories promised in opposition.

The Liberal Democrats are on an even steeper learning curve in government. They crossed a Rubicon this week when Vince Cable, the Business Secretary, buried the party's election pledge to abolish university tuition fees. He and Mr Clegg knew the promise was unaffordable but failed to persuade the Liberal Democrats to dump it before the election. It was watered down, but the party's manifesto still pledged abolish fees in the sixth year of a Liberal Democrat Government. Which tells us quite a lot about its mindset.

The party has travelled a long way in a short time. Even some Labour MPs quietly admitted that Mr Cable executed his 180-degree turn to supporting a rise in fees with style. "The road to Westminster is covered in the skid marks of political parties changing direction," he said.

It is a difficult manoeuvre for Liberal Democrat MPs – who all signed a pledge to vote against any rise in fees – especially those in university seats. But the backbench rebellion is fading and the fees increase will be approved by the Commons. "I would rather have a well-funded, viable university in my constituency and break the pledge," one MP said. Welcome to government.

The bigger threat to the Liberal Democrats may come from the cuts as a whole. Some of their MPs fret about Mr Osborne's lack of a Plan B if there is a double-dip recession. They fear he is staking all his chips on a private sector recovery that will be harder to secure after such huge public sector cuts.

Mr Clegg has adopted an "in for a penny, in for a pound" approach, signing up to the cuts to maximise his influence on where the axe should fall. The spending review is the product of two equal partners. Several key decisions have been taken by the group that Whitehall officials call "the quad" – Mr Cameron, Mr Osborne, Mr Clegg and Mr Alexander.

Aides say the four have had to walk through fire together and the political bonds between them have strengthened in the process. "It has been the making of the Coalition," one said. If the Chancellor doesn't get the economics right, it could be the breaking of it.

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