Ed Miliband and Nick Clegg's relationship is starting to thaw

There has been a notable political climate change behind the scenes, with the Lib Dem and Labour leaders spending more time together
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Maybe it's time for a change of partner... Nick Clegg with David Cameron. Photograph: Tim Ireland/PA

The personal is political. Ideas and events matter greatly, but relationships can be just as influential in the ebb and flow of power. So it is a significant development with considerable implications for the future that there has been a thaw over recent weeks in the relations between Ed Miliband and Nick Clegg. Put very simply, the two leaders are seeing more of each other. And generally speaking they have liked what they have seen. On the believable account of extremely well-informed observers on both sides, the two men are getting on better than they have done at any time before.

Though it has been happening behind the scenes, in a deliberately quiet way, this is an important change in the personal dynamics at Westminster. The Lib Dem leader's attitude towards his Labour opposite number used to be one of near complete disdain. Mr Clegg saw Mr Miliband as a betrayer of progressive causes for failing to mobilise Labour behind changing the voting system for the Commons and then helping Tory rebels to sabotage Lords reform. That contempt was reciprocated. In his first 18 months or so as leader, Mr Miliband licensed his party to make its most bilious attacks on Mr Clegg and declared that he would never be able to work with the other man.

That hostility is dissipating. There is still wariness in the relationship – one, after all, is deputy prime minister and the other is leader of the opposition. But there is also now more understanding and even respect. People close to the Lib Dem say that he now speaks of the Labour leader in warmer terms. Mr Clegg has been heard to express private admiration for Mr Miliband's pro-European speech to the CBI before Christmas and he has also been impressed that the Labour leader has resisted considerable pressure to match the referendum pledge that will be given by the Tories. Whereas he used to call him "Miliband", Mr Clegg is now more often to be heard referring to "Ed".

From the Labour side, I have had firm confirmation that the relationship has radically improved. Mr Miliband was genuinely impressed by the way in which the Lib Dem leader parted company with David Cameron and stood up to the press over the Leveson inquiry. The Labour leader thinks that this, in the words of one of his circle, "took some courage". The very beginning of this rapprochement can be traced back to the royal wedding when the two men had their first opportunity to have a proper chat. Ed Miliband came away from the conversation telling friends that he found the Lib Dem "a pretty decent human being".

As time has passed, there has been a decline in the levels of vituperation that were once spat from the opposition frontbench in the direction of the Lib Dem leader and his party. As one senior Labour figure puts it: "The language we are using about Nick Clegg is strikingly different from what it was even three months ago. We've gone from being very, very angry with the Lib Dems to focusing on the Tories." It is one of those piquant ironies of politics that Labour, having previously expended so much energy on trashing Nick Clegg, has a stake in him remaining in place to fight the next election. Were he to be replaced by a leader with a more social democratic flavour – Vince Cable or Chris Huhne – the Lib Dems could become more competitive for leftish voters. That would actually make Lab-Lib relations more difficult.

There is also some acknowledgement on both sides that each made mistakes in the way he dealt with the other in the first half of this parliament. Senior Labour people now accept that they were too blinded by rage with the Lib Dems to recognise that their main target should be the Tories. Then there are Lib Dems who concede that the aggression with which they rubbished Labour's record in office increased the poison between the two parties.

The personal defrosting between Messrs Miliband and Clegg is helped by the fact that they are meeting more often than they ever have before. The tempo has been increased by several private discussions about press reform after Leveson, a subject on which their positions are not identical, but are similar. Another area where the relationship is hot at the moment is over constituency boundary changes. The two leaders' offices have been closely co-ordinating, effectively working as a combined opposition, to ensure that the Tories don't secure a prize that the Conservatives once hoped would be worth a dozen or more extra parliamentary seats for them at the expense of the other two parties. Last Monday night, there was a first in the life of this parliament, one that deserved more media attention than it got. Lib Dem ministers and MPs marched into the same division lobby as Labour to vote against the Tories over boundary changes. "A Rubicon was crossed," says one senior figure.

The drawing closer is also driven by changing expectations about the outcome of the next election. At the inception of the coalition, and for some time afterwards, the working assumption among Lib Dem strategists was that the Tories would be the likeliest winners in 2015. This was also the presumption among most Conservatives and quite a lot of Labour people too. Prospects now look very different. The likelihood of the Conservatives winning the next election outright currently seems very slim. Lib Dems only have to talk to their Tory colleagues in government for five minutes to find out how gloomy they are. So the Lib Dems are thinking harder about what they would do if Labour is the largest party.

On the Labour side, there has been an increase in confidence that the next election could return them to power, but it is not accompanied by a robust conviction that they would win well enough to form a majority government on their own. Another hung parliament could beckon and the Lib Dems could again hold the balance. Their numbers in the next Commons may turn out to be rather larger than is suggested by their bleak ratings in the national polls because their MPs have been historically adept at holding what they already have and exploiting incumbency will be made easier for them by the killing of boundary changes.

When it comes to policy, in several key areas the two parties are much closer to each other than the Lib Dems are to the Tories. On Europe, they are united in repudiating David Cameron's notion of a renegotiation followed by a referendum some time around 2018. Mr Miliband and Mr Clegg have delivered virtually interchangeable speeches describing this as a recipe for five years of damaging instability and uncertainty. On tax, the two parties aren't that far apart. Both will go into the next election offering versions of the mansion tax, the Lib Dem idea that has virtually been adopted by Ed Balls. Neither was in favour of the Tory-driven cut in the top rate of income tax. On climate change, Labour spokespeople carp about coalition policy, but they know their quarrel is not really with Lib Dem ministers, but with those Conservatives who are trying to undermine the green agenda. On industrial policy, there should be plenty of common ground between the business secretary and former member of the SDP, Vince Cable and Andrew Adonis, another former member of the SDP who is leading Labour's policy formation in this area. On public services, it is harder to assess the degree of compatibility until Labour starts to offer some substance.

Even on deficit reduction, senior Lib Dems contend that they and Labour are not as far apart as it sometimes suits both sides to pretend. When the government publishes its number for planned total spending into the next parliament, Labour will be confronted with a major decision. If it rejects the government total, that would put the Tories and the Lib Dems on one side of a very fundamental divide and Labour on the other. But if Labour accepts, things would be very different. The argument between the parties would then not be about the total but about where they would spend. Lib Dem priorities would likely converge with Labour priorities more often than they did with Tory ones, with a potentially dramatic effect on the dynamics of the election campaign and the possibility of a Lab-Lib Dem government.

I wouldn't want to overstate this. Nick Clegg and Ed Miliband are not suddenly going to declare they've fallen in love. The Lib Dems remain committed to seeing out the full parliament in tandem with the Tories. Labour's ambition is to throw out both of the coalition parties and replace them with a majority Labour government. To do that, it will be aiming to take seats off the Lib Dems at the next election. They will continue to have harsh things – sometimes exceedingly rude ones – to say about each other.

But I wouldn't want to understate what is happening either. This is a change to the political climate that matters. At the same time as relations within the coalition are becoming more frosty, the deep freeze between Labour and the Lib Dems during the first half of this parliament is beginning to melt. The ice age is over.

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