Danny Alexander on Scottish independence, income tax, Nick Clegg and George Osborne

An interview with the coalition’s senior Scot

21 June 2014

8:00 AM

21 June 2014

8:00 AM

Danny Alexander doesn’t suntan well, but he looks more freckly than normal when we meet in HM Treasury.  He’s just back from the seaside town of Nairn in the Highlands, where, as the most senior Scot in the Cabinet, he’s been sent to fight in the front line of the Battle for Britain. People were queuing to sign up to the Better Together campaign, he says, and he has high hopes of defeating Alex Salmond on 18 September. It all added up to something rather rare for a Liberal Democrat: the feeling of being on the winning side in an election.

As Chief Secretary to the Treasury, he has been trusted with making various economic arguments for the union. If the Scottish National Party has been tugging heart-strings, the unionists have been tugging purse-strings — hoping that the latter mean more to Scots. They’ll be £1,400 better off a year, he says, if they vote ‘no’. I ask if his colleagues in the Treasury went a bit too far when they seemed to feel the need to translate this figure into Scottish, saying it meant ‘a meal of fish and chips with your family every day for around ten weeks’.

‘I think people ought to be able to see its funny side. If all these po-faced nationalists get in charge there will never be another joke told in Scotland under independence.’ But as a Highlander, didn’t he feel the urge to explain to the civil servants who wrote the chips analogy that Rab C. Nesbitt was not a documentary? ‘It is something that is aimed at a particular audience — that obviously other people didn’t like,’ he concedes. ‘I understand that, and perhaps some of it could have been better-judged.’ But it was, he says, a blip in a campaign that is heading for overall success.

Young Scots are particularly pro-union — which matters when all over-15s have the vote. He takes heart that Nairn Academy (my old school) held a referendum where just 28 per cent voted for separation. ‘Pretty much every school debate I’ve seen has had similar of results. That generation looks outwards,’ he says. ‘Somehow, the idea of erecting a border on our little island feels sort of 19th century.’ Scotland’s referendum, he said, is not just more important than next year’s general election but ‘more important than any political event that has occurred in my lifetime’.

The general election is not one that Lib  Dems are looking forward to with much enthusiasm; polls suggest they’ll lose two thirds of their MPs (Alexander included). He’s more optimistic, saying the party will focus on making clear its role in the economic recovery. ‘We’ve put more than £40 billion into income tax cuts over this parliament. Where did that idea come from? It’s a Liberal Democrat idea. I’m grateful for the Conservatives’ support, but a lot of those good ideas have come from us.’ This, he says, helps explain the boom in jobs. ‘Making work more financially attractive has helped to get more people into work.’

Spoken like a true Tory. Or, he’d argue, a Gladstonian Liberal. It was this political closeness to Nick Clegg that meant it was Alexander, rather than the left-leaning Vince Cable, who ended up George Osborne’s deputy. Alexander’s real influence lies in his status as one of the four members of the ‘quad’ that runs the British government. He is the only non-millionaire among them, and yet ended up being blamed by left-wing Lib Dems for passing what Labour calls the ‘tax cut for millionaires’: the reduction in the top rate of income tax from 50p to 45p.

The figures show that the richest 1 per cent now pay 27 per cent of all income tax, a higher share than ever. and all thanks to a tax cut. Tories are keen to make this point, but is he? ‘The wealthiest in our society are making the biggest contribution as a share of their income. I think that’s morally right,’ he says. Is this fairness something he is proud of? ‘Yes, absolutely.’ You don’t hear many Lib Dems being proud about cutting taxes for the rich — doesn’t he hear grumbles from activists? ‘Yes, but I think the explanation I’ve just given is absolutely copper-bottomed.’

He’s quite right, which makes it harder to understand why he felt the need to say that a 40p top rate would happen over his ‘dead body’. Except, of course, this is something Tories want — and every Lib Dem needs to draw some dividing lines. ‘There would be a proper Exchequer cost to that,’ he says — in other words, he thinks 45p is the optimum rate. He also wants to invent new council tax bands, for pricier properties. ‘If you are in a £700,000 house or a £70 million house you pay the same council tax,’ he says. But reassuringly, his wealth tax ideas do seem to end there. ‘I am not attracted to the idea that we should somehow measure the total wealth of people, and tax it.’

I’ve known Alexander for a while. On election night in 1997, we were drinking revolting concoctions of whisky and Irn Bru together with a group of Scots — toasting what we then believed would be a devolution settlement that would kill off separatism. That did not work out quite as well as we’d hoped. But I ask: would he have believed, then, that a chap in his thirties with no experience of running anything and no previously demonstrated interest (let alone expertise) in economics would be parachuted into the Treasury — and become his boss?

He sternly corrects me. ‘I’d say “colleague”,’ he says of the Chancellor — a surprising distinction, and not one any of his predecessors would have been bold enough to make. He works well with George Osborne, he says. ‘But that doesn’t mean we don’t have differences. We have big arguments.’ Environmental policy, he says, is the area ‘where we have the most friction’, but adds that they’ve learned to settle these disputes behind the scenes.

Osborne’s policy of sending underlings out into the firing line whenever bad news appears means that Alexander has had plenty of experience of hostile media. I put to him that his survival has raised the question of his one day being leader of the party. ‘It hasn’t led me to ask that question, it has led lots of people to ask me the question,’ he says. So when asked if he wants to succeed Nick Clegg, what’s his formula for avoiding giving a straight answer?

‘I’m not avoiding it, I’m telling you the truth. I’ve got a big job to do,’ he says. But would he like a bigger one, when the time is right? Will he say yes or no? ‘Look, I want Nick Clegg to carry on as leader for many years to come. We are old friends, I think he has done a superb job for the party and the country and there’s no vacancy. So the question just doesn’t arise.’

One of the stranger consequences of this coalition was to see their friendship forged into a power axis that has made this boyish 42-year-old into one of the most powerful men in the government. The role did not destroy him, as some predicted: he seems to be enjoying one of the most difficult jobs in politics. I ask if it’s true that he’s a deceptively fast bowler. ‘I used to be!’ he says. ‘I’m not as quick as I once was, but my left-arm inswing is quite dangerous.’ His style of cricket, he says, is like his politics. ‘No spin, it’s all swing.’

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  • misomiso

    If Scotland stays, I hope Danny and the Scottish Lib Dems form a Joint ticket with the Tories in Scotland.
    If the Unionists are united they could take a whole load of seats off the Nationalists and Labour.

    Maybe even merge into an Independent Unionist party?

    And that way the Lib Dems would keep their seats!

    • Jambo25

      Wishful thinking of a very high order.

    • rammyorstramash

      “I hope Danny and the Scottish Lib Dems form a Joint ticket with the Tories in Scotland.”

      Be assured, the rest of Scotland does not.

    • dougthedug


      Not aux fait with Scottish politics then?

      Labour are the bulk of the Unionists in Scotland.

  • dado_trunking

    When we are long past your love for Ikea and their kitchens (been there done that) but Westminster soon runs out of its most popular Scottish fat/oil burner, will we all embark on yet another round of wavemaking on stock trading platforms to maintain our standards of living?

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  • Danny Quisling Alexander

    Danny Alexander is the tony Blair of Scottish politics.

  • Danny Quisling Alexander

    Danny Alexander is the tony Blair of Scottish politics.