Leading article: Confident, but not entirely compelling

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Nick Clegg told the Liberal Democrat Party conference in Liverpool yesterday that "Britain in 2010 is anxious, unsure about the future". He might have said the same about his own party after four months of Coalition Government with the Conservative Party.

After their leader's speech some Liberal Democrat nerves are likely to have been settled. Mr Clegg made a compelling case for the Coalition, presenting it as a manifestation of "plural politics, partnership politics". It is certainly the case that the Liberal Democrats, after years of agitating for a "new politics", would have done grave damage to their credibility if they had refused to accept David Cameron's offer of partnership. As Mr Clegg pointed out, the onus is on the Liberal Democrats, as advocates of electoral reform, to show that coalition politics can work, even between two parties that do not make for natural bedfellows.

And yet, despite Mr Clegg's assertion of commitment to the Coalition, some subtle difference was put between the Liberal Democrats and the Conservatives. "The Coalition agreement is not the Liberal Democrat manifesto" conceded Mr Clegg, "but it is not the Conservative manifesto either". That was a polite way of saying that the Liberal Democrats have been a civilising influence on the Tories in office. There was an attempt to soothe some ruffled party feathers too, with Mr Clegg reiterating his view on the illegality of the Iraq war and echoing Danny Alexander's scathing denunciation of tax avoiders from the previous day. There was also a firm pledge that schools will not be given the freedom to select pupils. These are not tunes that would be heard at any Conservative Party conference.

Mr Clegg trumpeted distinctive Liberal Democrat policies enacted in recent months, from increasing the income tax threshold for the poorest, to scrapping ID cards, to raising capital gains tax, to a referendum on electoral reform. Much of what he outlined, however, is still promises. A pupil premium for poorer children will come in "at the start of the next school year". The green investment bank remains on the drawing board. So does a financial activities tax. Serious action on banking reform will have to wait on the verdict of a Government commission.

Mr Clegg promised more powers for local councils and an end to the central capping of Council Tax. But the Chancellor has frozen the levy for two years. And the expansion of academies and the introduction of free schools is set to undermine local authority oversight of education. This Government's localist credentials are still to be proven. Nor did Mr Clegg mention the costs of the Coalition as far as Liberal Democrats are concerned, from the VAT rise to the cap on non-EU immigration.

And the biggest cost of all is the ideologically-driven Budget. The weakest section of Mr Clegg's speech was his Margaret Thatcher-style comparison between the finances of a household and the finances of a nation. He called the deficit "a grave challenge". But he said nothing about the other grave economic challenge facing Britain, namely a potential return to recession, or a period of prolonged economic weakness, as a result of the scale and speed of the Coalition's spending cuts.

Overall, it was a confident performance from the Deputy Prime Minister. But serious questions were left unanswered. Though Mr Clegg outlined the logic of the coalition well, many of his MPs and activists will be left wondering how they will fight the next election on a distinctive platform. The Liberal Democrat leader noted that there are "1,690 days" until the next election, with the unspoken message that there is time for the party to recover in the opinion polls. That is the light that the party will, understandably, focus on. Yet realistic heads in the Liberal Democrats will know that crunch might come long before those days are up.

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