Cable and Fallon already at loggerheads over no-fault firing

Cable's new Tory deputy uses Today programme to show who's in the driving seat at Business

Column LAST UPDATED AT 10:54 ON Mon 10 Sep 2012

LIB DEM Business Secretary Vince Cable is heading for a showdown this week with the right wing of the Tory party – and specifically with his new Tory deputy Michael Fallon - over reforms to give bosses greater powers to fire their workers.

Cable, increasingly seen by the Tory right as a leftie bogeyman and obstacle to change, has stamped his feet to show he's the boss in his department, despite David Cameron's reshuffle which parachuted Fallon into his department to chivvy Cable into accepting more radical measures to boost the economy.

It has taken only days to develop into a 'who's in charge?' dispute at the Department for Business that makes the coalition rows in the new BBC series of The Thick of It look like scenes from a happy marriage.

The normally mild-mannered Cable bared his teeth on the BBC's Andrew Marr Show yesterday. "I am responsible for policy," said Cable. "Michael is not actually responsible for employment law."

As slapdowns go, it was not as effective as Cable's famous 2007 putdown of Gordon Brown - "from Stalin to Mr Bean".

Fallon clearly felt that Vince's bite was – to borrow from Denis Healey on Geoffrey Howe - like being savaged by a dead sheep, and duly popped up on the Today programme this morning to show the Tories are in the driving seat in Cable's department, underlining the point that the Tories have five ministers there compared to the Lib Dems' two.

The flashpoint is the report by venture capitalist Adrian Beecroft which includes a proposal for "no fault" dismissal making it easier for bosses to take new staff on and fire them if they turn out to be under-performers.

Cable has dismissed the report as "nonsense" and said on Sunday there was "no support" for no fault dismissal. But today Fallon insisted: "We are going to change the law further.

"We are going to reduce the burden where both of you agree that a member of staff is not performing and has to be sadly let go, the relationship has to be terminated. There has to be a far better way of doing that with a negotiated settlement rather than going off to a tribunal."

And Fallon added: "We are going to deregulate further in that area..."

Sounds like Cable could be the first to go under the no fault rules, with Tory MPs pushing Cameron to get rid of him before the general election.

Cable, a wise old bird, has a big stick, however. He could lead a Lib Dem coalition with Labour to seize power from Cameron and the Tories at the next election.

Ed Balls love-bombed Cable on the same Andrew Marr Show and made it clear he and Ed Miliband, the Labour leader, would not do a deal with the Lib Dems while Nick Clegg remained their leader. That is certain to cause fireworks at the Lib Dems' conference, starting in Brighton on 22 September, and give Cameron pause for thought. ·