Lib Dems are not in as much trouble as you might have thought...but things change

Inside Westminster

"Labour will screw the economy, the Tories will screw you."

That is how one influential Liberal Democrat summed up the party’s general election message. I rather doubt the slogan will make it into a Nick Clegg speech or Lib Dem poster. But the sentiment behind it most certainly will.

A year ago, senior Lib Dems expected to be thinking about a post-election deal with Labour as polling day approached. Although the opinion polls show Labour and the Conservatives neck and neck, many Lib Dem minds now believe that David Cameron rather than Ed Miliband will have the most MPs after 7 May.

That view hardened during Labour’s bad week. The launch of its 10-year NHS plan on Tuesday was pencilled in as a big moment in the party’s four-month campaign. But positive media coverage was eclipsed by hostile noises-off from Blairite former Cabinet ministers and advisers, led by Alan Milburn, who questioned the dominant role of health in the Labour campaign and the party’s desire to reduce the private sector’s role in delivering state-funded health care.

It looks to me like the Blairites “agree with Nick” and share the Lib Dems’ view that Mr Miliband is heading for defeat.

Although their attacks were not co-ordinated, it seems the New Labour gang is getting its retaliation in first, so it can say “I told you so” as it tries to recapture the party leadership after a defeat. The timing is very dangerous for Mr Miliband.

We might have expected the Tories to snipe at their leader at this stage. But while the electoral map would deliver Labour more seats if the two biggest parties got the same share of the vote, Tory MPs are more optimistic than their Labour counterparts and the Tories deploy their traditional secret weapon – loyalty.

The mood in Lib Dem Land is much better than the polls would suggest. This week’s ComRes survey for this newspaper, showing Mr Clegg’s party on 8 per cent, would see its number of seats drop from 57 to just 20 on a uniform swing. However, the Lib Dems are confident of holding more than 30 seats because there will not be a uniform swing.

The party will pour its slender resources into their 57 constituencies and a few unnamed targets. The “incumbency factor” which helps sitting MPs – bigger than it once now that they are expected to be super councillors – will boost the Lib Dems’ prospects. Their private polls suggest their MPs’ ratings are up to 14 points higher than the party, which could make all the difference.

The rise of the revitalised Green Party, which ComRes puts only a point behind the Lib Dems, is not all bad news for Mr Clegg. His advisers believe the “Green surge” will include some 2010 Lib Dem voters, but they will be mainly those who switched to Labour when Mr Clegg joined Mr Cameron in coalition, rather than more recent Lib Dem supporters.

A Green advance could even help the Lib Dems in some marginal seats Labour hopes to gain as it could depress the Labour vote.

The Lib Dem strategy will focus on five themes: raising the personal tax allowance (a policy shamelessly stolen by the Tories); tackling the deficit; a boost to spending on education and health and the environment.

The party will “borrow less than Labour and cut less than the Tories,” a soundbite that seems to work in the 25 per cent of the electorate the Lib Dems see as their market.

A key target is what the Lib Dems call “soft Cons”. These are not prisoners who are not hardened criminals but natural Conservatives who do not want an ideological crusade against public services (and are often pro-environment).

Clegg & Co will not challenge the Tories’ pitch to “finish the job” of clearing the deficit. But the Lib Dems will argue that their presence is needed in government to prevent “the nasty party” slashing state spending for the sake of it. The nice Lib Dems will portray the Tories as mean-spirited, promising to stop them balancing the books through welfare cuts centered on working age benefits. Lib Dems suspect housing benefit cuts would be the main target of a Tory-only administration, a bigger version of the “bedroom tax” to force low income families to move to cheaper accommodation. The Lib Dems judge that a party’s instincts matter to voters as well as its policies, and that the Tories are still not a trusted brand on “fairness”, just as Labour lacks people’s confidence on the economy.

While the Greens may pose more of a threat to Labour than to the Lib Dems, Mr Clegg has another party to fear in the SNP. The Lib Dems have 11 MPs in Scotland and two of their big fish, Sir Menzies Campbell and Sir Malcolm Bruce, are standing down. Mr Clegg won’t admit it, but he needs a Labour revival north of the border.

The latest polls suggest that the SNP, which currently has six MPs, could win 49 of Scotland’s 59 seats. Labour, which won 41 last time, has the most to lose.

Its big majorities in some seats may be too much for the Nationalists to overturn. But the SNP could still keep Mr Miliband out of Downing Street. If the SNP does well, it could have more MPs than the Lib Dems, overtaking them as the third party.

That might also mean that the Tories and Lib Dems combined would not reach the 326 seats needed for an overall majority. Unless Labour does much better than the Lib Dems expect, Mr Clegg’s hopes of a second coalition could be scuppered by the SNP.