Ed Balls/Nick Clegg love-in: laying ground for new coalition

THE surprise overtures between Ed Balls and Nick Clegg - likened by one cartoonist to the love affair in the BBC drama 7.39 - suggest Labour contingency planning for a hung Parliament after the May 2015 general election

Balls used an interview with the Labour-supporting New Statesman to reveal he's had a "friendly chat" with Clegg in the Commons and to hint that, despite slagging off Clegg in the past, Labour are now prepared to work with him in a coalition, if the post-election arithmetic required it.

"I can disagree with Nick Clegg on some of the things he did but I've no reason to doubt his integrity. We've never, I don't think, ever had a cross word," says Balls.

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"I understand totally why Nick Clegg made the decision that he made to go into coalition with the Conservatives at the time, I may not have liked it at the time, but I understood it. I also understood totally his decision to support a credible deficit reduction plan, because it was necessary in 2010."

This marks a stunning thawing of relations. In November 2011 Balls said: "I don't think there's a single member of the shadow cabinet who'd find it easy to sit down with Nick Clegg…" Then, in December that year, he appeared to suggest that removing Clegg as Lib Dem leader would be the price for a 2015 coalition with Labour, saying: "I don't think it's possible for Nick Clegg to lead that move".

Commentators have enjoyed the spectacle of Balls eating his words, and suddenly finding political love in his heart for Clegg. They have even exchanged a friendly political in-joke on Twitter: Nick Clegg tweeted simply: "Ed Balls". Ed Balls tweeted back: "I agree with Nick".

But Rafael Behr, political editor of the New Statesman, reckons that the overtures by Balls mark a deeper shift of strategic thinking inside Ed Miliband's camp.

Talking on BBC TV's Daily Politics show, Behr argued that Labour made a big mistake in 2010 in not thinking seriously about negotiating with the Lib Dems and this time, despite current opinion polls suggesting they will win an outright majority in 2015, they need to have plans in place should they win the highest number of seats but not a working majority.

"I would be very surprised if there wasn't - very close to Ed Miliband, very privately - a discussion about what that is going to involve," said Behr. "That is entirely why Labour support a mansion tax, that is Lib Dem policy; it's clearly part of the thinking of 'do they, don't they' back a referendum on the European Union; they are thinking what is compatible with a Lib Dem platform though you would never hear them say that in public."

Steve Richards, The Independent commentator, said this morning on Radio 4's Today programme: "There is something real going on. We might be in an age of the parties not winning overall majorities. If the polls gave Labour a 30 points lead, we would not be having these discussions." [Latest polls give Labour between a seven and nine points lead.]

Clegg made the move to cosy up to Balls all the easier by his furious attack on George Osborne on Monday for proposing further heavy cuts in welfare spending. He and Balls are now singing from the same hymn sheet in opposition to the Tories' "soak-the-poor" strategy.

But there are other policies - such as Miliband's freeze on energy prices - which the Lib Dems oppose that will have to be negotiated if they are to enter a coalition with Labour after the 2015 election.

The Tories and Lib Dems will go head-to-head in the European and local elections in May but the Financial Times reported this week that Clegg has told his colleagues to hold fire on the big guns against Cameron until the autumn. "That's the real start of the election," sources close to Clegg told the FT.

With the Lib Dems polling less than ten per cent in most polls, behind Ukip, Clegg is in the ludicrous position of having to sharpen his anti-Tory rhetoric to distance himself from the government he is supporting. Meanwhile, the overtures from Balls show that the behind-the-scenes horse-trading with Labour has already started.