Clegg should demand real investment for renewing those vows

With Francois Hollande elected in France and Labour's modest triumph in the council polls, it is hardly surprising that David Cameron and Nick Clegg feel the need to renew the vows they exchanged in the shotgun wedding of 2010. But whether they should stick to the letter of the pre-nup that they signed on that fateful day is another matter. The economy desperately needs investment, and the government badly needs a sense of purpose. There are few signs that either are planned. And that reflects a failure of imagination by Nick Clegg and his improbably sidekick Danny Alexander.

The Budget was not just a disaster for the Tories, countering George Osborne's smugness with its extraordinary collection of crowd-displeasers. It was also a failure for Nick Clegg, because he failed to persuade his coalition partners that cutting the 50p tax rate at a time when the country (and Europe) has entered into a populist anti-rich rage might not be the best idea, just at the moment.

But then despite the hype there is little sign that the Liberal Democrats have gained much beyond becoming a punching bag for liberal initiatives already favoured by Cameroon reforms, such as gay marriage or even Lords reform. The Lib Dems have failed utterly to promote the sort of infrastructural investment that might move the economy from Osborne's recession into lasting growth. School building has been slashed. House building is a combination of anti-Labour spin and coalition inaction. The high speed rail will take years to materialise and Heathrow is chaotic not just because of Teresa May's passport panic, but because there is nowhere for the planes to land half the time. High speed broadband seems a distant dream, especially with BT involved.

We have seen that infrastructure can be delivered on budget and on time with the Olympic stadium. And I have no quibble with efforts to get better value for money than Labour in public building projects. But there is simply not enough action on providing the major infrastructural investment that could give the economy the kickstart it needs, boosting demand and jobs, and ensuring more people pay taxes rather than draw benefits. Rather than fighting plans for an extra £10bn cut in welfare budgets, Clegg should be seeking to cut the budget by getting people into real jobs. At present, all that's on offer is the dubious rebadging exercise known as the Youth Contract.

Within months, Europe including Germany will recognise - in part because of what's happening in France and Greece - that it needs a better balance between austerity and growth, and that investment projects are needed for the latter. The US under Barack Obama has recognised that, as has the IMF and OECD in its advice to member nations. This is not about cutting day-to-day spending, which will have to continue, though Osborne always underestimated its knock-on impact on private sector services, but about medium to long-term investments that will have a return.

So, rather than whining about Lords Reform, Clegg and his colleagues should force the investment issue with a real determination: new rail, schools, housing, airports. If he focused on that rather than the dubious achievements that he cites for his role in Government to date, the voters might even notice. By the same token, Labour should switch its arguments from the speed of the spending cuts to a ceaseless demand for more capital investment, with a strong critque of the government's enduring incompetence and inability to deliver. It too might find that a successful formula to consolidate and advance on Thursday's success.