A defence of our role in Coalition, whatever Jeremy Browne thinks

This recovery has not come about by accident

Jeremy Browne in his Westminster office (Tom Pilston/The Independent)

In 2010, our economy was still reeling from the effects of the 2008 crash. With huge economic challenges, and no plan to deal with them, Britain was on the brink. That was the backdrop for the talks which led to the formation of the coalition, which I led for the Liberal Democrats.

Liberalism is about individual freedom, fairness and opportunity. And freedom, fairness and opportunity cannot flourish without a strong economy.

Today, Britain has the strongest growth and fastest job creation of any advanced economy. Inflation is benign, business investment is rising and we have record numbers in work. By any measure, Britain is making strong progress and opportunity is increasing.

This recovery has not come about by accident. It has been hard earned by millions of people and businesses. But we needed the right economic climate for the recovery. That climate is the direct result of liberal values in the recovery plan – fairness and opportunity. Delivered in the Coalition by Liberal Democrat policies - a balanced approach to dealing with the deficit; raising the income tax personal allowance to make work more attractive; creating apprenticeships to give people the skills they need; and the priority we have given to boosting investment in regional and local businesses, innovation and infrastructure. This is not “splitting the difference” between the other parties. It’s doing things in a distinctly different way, the liberal way. Even a cursory look back at previous recessions and recoveries history shows just what a profound difference we have made.

Many will remember the Conservative Chancellor Norman Lamont saying in 1991 that “rising unemployment and the recession have been the price that we have had to pay to get inflation down. That price is well worth paying”. It was a disgraceful thing to say, but it reflected that harsh and uncaring side of Conservatism that seems to shine through whenever the Conservatives are threatened, as they are now by the rise of Ukip.

Unemployment in the 1980s and 1990s recessions climbed into double figures and worse it stayed too high for far too long. In the 1990s, six years after the start of the recession, unemployment remained close to eight per cent, in the 1980s it was over 11 per cent. Compare that to now, six years after the start of the recession and unemployment is under six per cent.

Even though the recession we inherited was much deeper and more complex in its origin than those of the 1980s or the 1990s, this recovery is very different. Without doubt, times remain tough for millions of families. But we haven’t seen mass unemployment and the social scarring that was left by Tory governments in the past. Instead, more British people have a job than ever before.

We have put in place a different kind of recovery: perhaps the first time we have even got close to a “recovery for all".

Britain is working because of the Liberal Democrats have led the economic policy of this government. Mr Gladstone, whose portrait I have had in my Treasury office since day one, would be proud.

This recovery has been hard earned. But there is lot more hard work needed to secure it, and there are two huge risks on the horizon.

The first is a majority Labour government. Labour hasn't learned the lessons of its own economic mismanagement in the last parliament, or its failed predictions on the economy in this one.

The second is a majority Conservative government. The Conservatives have surrendered their claim to economic competence by their reckless promises of unfunded tax cuts and an ideological drive to shrivel the state way beyond what is needed to balance the books.

Far from being in “No Man’s Land”, our party stands proud of its record of economic competence during these difficult years. And such has been the influence and importance of our flagship policies on the personal allowance and apprenticeships that we see our coalition partners routinely attempt to claim credit for them.

We are the only party with plans that will safe guard the recovery, finish the job of deficit reduction fairly, allow Britain to turn the corner in 2018 and to see opportunity increase for our citizens.

Danny Alexander is the Liberal Democrat Chief Treasury Secretary