ANY QUOTES USED MUST BE ATTRIBUTED TO SUNDAY WITH NIALL PATERSON, SKY NEWS
NIALL PATERSON: Now the former Business Secretary, a man with experience of budgets from the heart of government for five years, the Liberal Democrat leader, Sir Vince Cable, joins me in the studio. Sir Vince, lovely to see you this morning, shall we start with the budget? It seems an appropriate place for us to begin – your assessment of how Spreadsheet Phil performed this year?
VINCE CABLE: Well he was operating under very, very tight constraints. The key point that emerged in the few minutes at the beginning of the budget was that British growth prospects are not good, productivity is stagnated for quite a long period of time and is well below our competitor countries so against that background with the uncertainty over Brexit, with high levels of government debt, he was in a very, very tight corner.
NP: Still at the same time you have weighed in from the opposition benches on a number of budgets over the years and we have seen them unravel pretty quickly once the IFS get their hands on the red book, 10p tax, pasty tax and so on. In those terms, if he was hoping to avoid a cockup then he certainly did that.
VINCE CABLE: Well I think that’s a fair assessment. There hasn’t been any unravelling of any of the technical changes. I think the one big question, the long eared rabbit that he produced out of the hat which is the stamp duty cut, is an attractive measure for first time buyers but I think the small print in the Office of Budget Responsibility report suggests that it might actually be counterproductive. However attractive it is for young people racking up the money for deposits, it boosts demands, it puts up house prices and actually makes it more difficult to get on the housing ladder but that apart, he has avoided any major pitfalls.
NP: Productivity as you yourself just identified seems to be a huge issue for the country at the moment, why are we seeing historically low productivity growth?
VINCE CABLE: I don't think anybody totally understands it but I think there’s a mixture of things. One of them is lack of investment, that is a very long standing problem and we do have problems of chronic uncertainty and this is in a way why the whole Brexit process is, whether it’s good or bad, is so badly timed because at a time when Britain was beginning to recover from the banking crisis, we’ve had a mega shock affecting investment. I think the other big problem is skills, we were beginning to make serious traction in the coalition with boosting apprenticeships In quantity and quality but the government’s apprenticeship levy that they are bringing in at the moment, a good concept but it is having a very damaging effect because of clumsy implementation.
NP: As you say, this has been a problem for a number of years. You were Business Secretary for five of them, do you shoulder some of the responsibility?
VINCE CABLE: Well we did a lot of things in that period to try to … we recognised the problem. I think seen from inside the coalition, the first task was to prevent mass unemployment, that could very easily have followed from the banking crisis and the recession which followed it and we avoided that and actually large amounts of employment have been created but it is relatively low productivity employment. I think the kind of things that I was doing with the support of my colleagues was launching the Industrial Strategy.
NP: Which is launched tomorrow in fact.
VINCE CABLE: Yes, if the government sticks with it that is a very important long term framework and I think it was a good thing we did. We set up institutions to make sure credit goes to small business, that’s one of the big bottlenecks, helping small companies to grow, so we did actually lay the foundations for a big improvement in productivity in the longer term.
NP: Turning our attention to Brexit for a second, are you still of the opinion that it might not happen?
VINCE CABLE: Yes, I wouldn’t say that it is probable that it will be stopped but there is a distinct possibility. I have been asked by business people in the past to put a probability estimate, I’d say there is probably about a 20% possibility that this may not happen.
NP: Is that because we decide not to exit the European Union or because issues, let’s take one for example, the Northern Irish border, are seemingly intractable?
VINCE CABLE: I think it could be a combination of those things. The government is of course pressing ahead with negotiations but the sheer complexity, the practical difficulties, the fact that government is internally divided – we may get to the middle of next year and find this is just a horrible mess and there will be a growing political mood in the country and in parliament to find a way out and that’s why we think at the end of the day the public should have a choice as to whether they want to go ahead with Brexit when we’ve discovered what it’s about or whether they want an exit from Brexit.
NP: But isn’t it the case that it certainly doesn’t appear, particularly given the Lib Dems fairly unique stance on Brexit, I mean the public don’t want to have that second decision. Given your position, given the millions of people who rather we didn’t leave the European Union, shouldn’t you be doing rather better in the polls?
VINCE CABLE: Well I think we will in the course of time. You are quite right to characterise public opinion, there is probably about 30% who absolutely believe Remain, we should be there and want to back out of where we are but there is a larger number who have voted for Brexit and want to stick with it and then there are some in between, maybe a quarter of the public who are giving the government the benefit of the doubt, who hope that something good will come out of the negotiations but we don’t know, we absolutely do not know what Brexit will look like. It could be that eventually we could get an amicable divorce, it looks increasingly unlikely but it is possible, in which case I think the public would settle for that. But if it is a terrible mess and very divisive and very costly, then I think people will want to reopen the question.
NP: Is part of the problem with the way the Liberal Democrats are polling at the moment, given the position on Brexit, is it fair to say, to suggest I should say, that part of the problem might well be you? 37% of voters in a November YouGov poll said that they don’t know how they feel about you, which I suppose is better than being hated but it’s not great for a professional politician.
VINCE CABLE: Well I’ve had the leadership role for a few months and I’m going round the country and building up recognition and when I last saw those surveys they were relatively favourable, relative to the other two leaders but time will tell. I have had a lot of practical experience of government as well as leading my party so I am confident that in time we will make an impact, initially probably in local government and then at national level at the next election.
NP: Isn’t it the associations that you have with for example Nick Clegg, with the coalition itself, it is difficult if not impossible for you to rid yourself of the shackles of what you did and what your colleagues in the coalition did.
VINCE CABLE: Well I think Nick Clegg played a very important historical role in, for the first time in personal history, in getting parties to work together in the national interest. Now some people are very frustrated with the economic conditions in the country, they partly blame us for that but actually I think looking back on those five years from the chaotic situation we have now, I think people do recognise that it was actually in many respects good government. We achieved a lot, my party did a lot of good and stopped a lot of bad and it provided five years of stability and given where we are now, for goodness sake, there is a fair degree of coalition nostalgia I think setting in in the country and I think that will reflect well on us.
NP: Coalition nostalgia, I’m going to remember that one for our next interview. Sir Vince Cable, many thanks for being with us.
VINCE CABLE: Thank you.