Steve Richards: Vince Cable is now a plausible leader-in-waiting

Cable could avert a meltdown in support for his party, and change the dynamics of an election

Vince Cable seems to be almost enjoying himself again. After a pre-election high in which he could do no wrong he suffered a post-election low. I once asked him why he managed to look miserable on TV in the early months of the Coalition. "Because I was miserable," he replied. Now as the Coalition approaches mid-term he is one of the most important figures in British politics, the Lib Dem Cabinet minister who dares to wonder aloud whether David Cameron is really the moderate of mythology and who maintains a limited dialogue with Labour's leadership.

The relationship with Labour is tentative, but significant. After Ed Miliband delivered his speech at last year's Labour conference, the newish leader returned to his hotel feeling demoralised. An army of political commentators had given his address the thumbs down on Twitter. His aides warned him that the verdicts in the newspapers would be negative. At which point Miliband received a text describing his speech as one of the best arguments for social democracy made in years. The text came from Cable.

This brief, counter-intuitive message is revealing for lots of reasons. Above all it shows that Cable was ahead of the game in recognising that Miliband was on to something big. More widely the text highlights Cable's unique position in British politics as the only Liberal Democrat Cabinet minister who would have taken such a view and communicated it to Miliband. The dialogue continues within cautious, informal limits, with both sides retaining their independence. To take a more recent example, Miliband's office sought to discover whether Cable would support their call for a judicial inquiry into the conduct of banks. Cable made clear he would not do so.

The very existence of any form of communication is revealing and places recent public comments in a wider context. In weekend interviews to the Financial Times and the BBC, Cable refused to rule out becoming leader of his party. In the FT Cable also admitted that he did not know whether Cameron was a Tory hardliner or a moderate: "I think he speaks for the latter but I don't know whether he is – deep down." In other words, at the very least he wonders, with considerable evidence to support his doubts, whether the Liberal Democrats are in coalition not only with "hardline" Conservative MPs but with a leader who is a hardline Tory too.

Cable's distinctiveness makes him a pivotal player in three possible historic scenarios. Nearer the election there will almost certainly be headline- grabbing polls suggesting that the Lib Dems would be more popular under Cable's leadership. If Clegg were to stand down – he will not be challenged – Cable would be the obvious successor. In such circumstances Cable might avert a meltdown in support for the Lib Dems and would utterly change the dynamics of an election.

In my view this scenario remains unlikely. On the whole leaders prefer to hope their qualities will be recognised by the voters if they remain in place long enough, even if there is no evidence of such recognition taking shape. A second scenario is much more likely. Polls and political context suggest another hung parliament is a strong possibility after the next election. For such a fluid prospect we know quite a lot about what might happen then. Given the current level of restless anger within parts of the Coalition there will be no sequel. Both sides have already had enough and there is three years to go.

In yesterday's Independent Miliband suggested that he would not be able to work with Clegg in another hung parliament. As Miliband and Clegg are convivial types this is an important statement. Miliband is genuinely shocked at the apparent ideological ease that Clegg displayed in the early months of the Coalition's haphazard revolution and regards him as a figure of the right. Evidently the Labour leader could work with Cable, as in an extremely limited way he is doing so already. Cable would be the key figure in re-establishing a constructive relationship with Labour. Sometimes seen as more tribal than Miliband, Ed Balls also said in an interview for The Independent at the end of last year that he could work "tomorrow" with Cable on economic policy, but not with Clegg. Whether he is leader or not, Cable will be the key figure in another hung parliament.

The third scenario is more immediate. Within the current Cabinet Cable is in a stronger position than at any point since the last election. Polls suggest that most voters would prefer to see him as Chancellor than George Osborne. He has recovered some of his pre-election popularity and is un-sackable as a Cabinet minister. Urging what he calls a more robust Plan A Plus, he could put irresistible pressure on a conservative Treasury and its bewildered, weakened Chancellor. In alliance with a growing number of business leaders Cable has a key role now in urging Osborne to be more flexible in the hunt for growth.

The only question is whether Cable has the inclination or guile to exert the power that his position has created for him. Sometimes he seems disinclined to act. But if he chooses, he could save the Coalition from itself and be the key figure in a post-election progressive alliance. Not bad for a Cabinet minister who was happy to be seen looking miserable.

s.richards@independent.co.uk