Europe is set to exacerbate the coalition’s internal tensions

As James suggested yesterday, the publication of the Beecroft proposals this week could be a significant moment. If the coalition can carve a constructive agenda from them, then we might have a set of growth policies worthy of the name. But if it degrades into yet another internal squabble, then that chance may be missed. So, what’s it to be?

It must be said, the tea leaves aren’t terribly encouraging this morning. Yesterday, we were told that David Cameron and George Osborne are minded to unravel the red tape that surrounds businesses when it comes to hiring and firing. But, today, one of their fellow ministers has spoken out against that sort of thinking. And guess which one it is. Yep, Vince Cable. He writes in the Sun that:

‘Some people think that if labour rights were stripped down, employers would start hiring and the economy would soar again. This is complete nonsense. British workers are an asset, not just a cost. I am opposed to the ideological zealots who want firms to fire at will.’

Of course some caveats need to be slapped across this. For starters, this is Vince Cable we’re talking about — so a public outburst is almost to be expected, and needn’t necessarily make much difference. And he’s also railing against generalities — which leaves room for discussion on the specifics, aka the actual policy. But, that said, you can’t get away from the ferocity of the Business Secretary’s rhetoric here. Signs are that the coalition is heading for an almighty scrap over the Beecroft report.

It must worry Cameron that this becomes the norm, rather than just a periodic flare-up. After all, the longer the eurozone’s woes continue, the more pressure there will be on him and the Chancellor to enact radical policies on tax, spending, regulation, Europe, whatever — and they will be exactly the sort of policies that Lib Dems don’t naturally like. There have been ideas swirling around Downing Street to do with, say, regionalising the minimum wage, or suspending it in certain cases. But if Beecroft can’t get through, then what chance that sort of thing?