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DERMOT MURNAGHAN: Now the Liberal Democrats used to be the party themselves of protest, they were an electoral home for people with all sorts of views pursuing all sorts of policies.  Not any more, they are in government.  In last week’s Rochester by-election they came in fifth place behind the Greens, it was the worst ever performance in a by-election by a governing party and I am joined now by the Liberal Democrat MP and Secretary of State for Scotland, Alistair Carmichael, a very good morning to you Mr Carmichael.  So the Lib Dems must be viewing the prospect of the next general election as something akin to turkeys and Christmas except turkeys don’t know Christmas is coming.

ALISTAIR CARMICHAEL:  Look, no party knows better than the Liberal Democrats that you get good, bad and indifferent results in by-elections and it doesn’t actually make any difference come the general election because we’ve had the good results in the past and then come polling day when it was actually a question of choosing a government, we didn’t get that continued level of support.  Now to be quite clear …

DM: But it wasn’t exactly a blip in Rochester, aren’t you wistful for the situation five years ago almost in that that’s the seat the Lib Dem might have won?

ALISTAIR CARMICHAEL:  If it’s a choice between having mid-term success in a by-election or actually being in government, I will take being in government any day. I don’t actually accept your thesis that we would have won Rochester in the past, that was always going to be a classic two party, two horse race between the Conservatives and UKIP and we were always going to be …  

DM: Hold on, I am just thinking about five years ago, what the Liberal Democrats represented.  You spoke to people who felt like that, who felt that the establishment don’t speak for us, they don’t understand us and you would have done a lot better, you must admit that?

ALISTAIR CARMICHAEL:  We may well have done, who knows?  You are asking me to speculate but I take your point seriously.  I don’t want to see my party turning in bad results like that, we need to look at the result and we need to look at the lessons from it.  I think one of the things that is emerging is that now we seem to be into four party politics, frankly there is no such thing as national politics anymore.  Different parties have different areas of strength in different parts of the country and the strength of our vote will be seen in those areas where we have MPs, where we have a large well organised political machine which will turn out the results because the position in by-elections has not been uniformly bad over this parliament.  We won Eastleigh, we came very close to winning Oldham East and Saddleworth.  

DM: One of the key weapons you deployed at the last general election was your leader, Nick Clegg. Things have changed, boy how they’ve changed for Nick Clegg.  Would you regard him still as an electoral asset?  

ALISTAIR CARMICHAEL:  Absolutely.  We don’t have the support in the media, we don’t have uncritical friends like the Labour party and the Conservatives have so yes, there are always going to be people putting out negative messages but when you go out on the street, when you go out in the constituencies with Nick, you get a very warm reception.  

DM: What about the candidates who didn’t want to put his picture on their pamphlets, it is like Barack Obama in the mid-term elections for the Democrats, they don’t want to touch him with a bargepole, Lib Dem candidates.

ALISTAIR CARMICHAEL: People are much more reasonable than politicians and journalists often give them credit for and I think that most people out there realise that Nick Clegg was between a rock and a hard place in 2010, he has taken tough decisions but that actually as a result of it, by the end of this parliament we will have an economy that is growing again, which is stronger than the one we inherited in 2010 and because we have been able to do things like linking the level of the state pension to earnings or inflation, because we are giving people who are working on low incomes more of their money by raising the threshold at which you start to pay tax, you will see that what we’ve got is a stronger economy.  There is still a lot to do but it is a fairer society which does allow people to get on in life.

DM: Talk to me about Scotland.  Obviously as Secretary of State for Scotland, much is being made of the SNP threat to Labour there with its large number of seats but of course the Lib Dems have got eleven seats there and some of them are under threat from the SNP including by, if he stands, the former leader Alex Salmond.  

ALISTAIR CARMICHAEL:  Well again you are asking me to speculate on poll results and the one thing we learned, if we didn’t know it before, during the referendum is that …

DM: Well we’ve just had a poll haven’t we?

ALISTAIR CARMICHAEL: Exactly, we have just had a referendum were in fact 55.3% of my fellow Scots chose to remain part of the United Kingdom.  I think that’s something that we now need to build on.  The truth of the matter though is there is still a lot of emotion swilling about in Scottish politics, it will take time for that to drain from the system and the polls that you are seeing today are not necessarily going to be reflected in the outcome of the general election.  

DM: Okay, just on that referendum, do the SNP need to be reminded that they actually lost that vote because we saw those rallies with Nicola Sturgeon, the new leader, the new First Minister, going around, it’s like a rock star.  

ALISTAIR CARMICHAEL:  I’m afraid they do need to be reminded and it’s not about Nicola and it’s not about Alex but the nationalists as a whole need to be reminded that they entered into an agreement in the first place that said we will have a referendum to settle this, that referendum will be fair, legal and decisive.  It has been all three, they now need to accept the result, they need to move on and the SNP in government in Scotland now need to start doing the best that they’ve got with the powers that they have rather than playing the blame game, making all the excuses and pushing the blame onto …  

DM: Well I was going to move on to that because of course they are going to get more powers, still unspecified, we are going to hear a little bit more about that later this week.  Do you think that will put it to bed for the time being, put the independence issue to bed?

ALISTAIR CARMICHAEL:  Look, I think that having made a vow during the course of the referendum campaign, the three parties that wanted to remain in the UK, my own party the Liberal Democrats, the Conservatives and the Labour party now have to demonstrate that they are delivering on that vow.  They are, the nationalists are determined to build this narrative that says that somehow or another we are backsliding and there is betrayal.  That’s nonsense, come Thursday I think the people of Scotland will see that to be the nonsense that it is.  

DM: But do you think those powers can be handed over in isolation?  Is there not, as the Conservatives argue, a cause and effect here, a reaction to the action in that some English voters need more powers?  

ALISTAIR CARMICHAEL:  If you are telling me that we need constitutional reform across the United Kingdom as a whole, then yes, I’m a Liberal Democrat and …

DM: But English votes on English laws?  

ALISTAIR CARMICHAEL:  That’s one very small piece of constitutional reform that would create just as many problems as it would solve so if you are going to undertake constitutional reform then you do it properly and you bring forward the whole package.  The one important point though is that we made a vow in Scotland which had a timetable attached to it, we will go and we will deliver to that timetable and we won’t be held up while the people of England, Wales and Northern Ireland decide what it is they want to have.  

DM: But if these powers do not satisfy SNP supporters, and you know it is already happening, discussion about independence continuing, it is almost that as was predicted before, a neverendum.  Do you say to the SNP, to others, you lost it and we cannot revisit this issue through a referendum for a political generation.  

ALISTAIR CARMICHAEL:  The SNP have got to say that and it is not a point about politics, it is about economics.  You look across to the other side of the Atlantic, see what happened in Quebec when the separatists there would not accept that they had lost the referendum.  In fact they lost it twice.  What happened was that the financial services sector which had been traditionally headquartered in Montreal moved lock and barrel to Toronto.  If that were to happen to Edinburgh, if the financial services sector which is predominantly headquartered in Edinburgh were suddenly to decide they couldn’t live with the uncertainty of constant constitutional change, then if they decided they were off to Newcastle or Manchester that would be really bad news.  200,000 jobs in Scotland, well paid, highly skilled jobs.   

DM: Last question Mr Carmichael about Theresa May and the reaction to what she’s been saying this morning about the security of the state, the Data Communications Bill that the Lib Dems have been blocking, it’s very important that it gets through to keep this nation secure.

ALISTAIR CARMICHAEL: I think what we’ve got now is a sensible compromise.  It is far removed from the Snooper’s Charter that the Home Office originally wanted which produced such a very strong reaction from people across the country, that sort of intrusive practice is not going to be part of it.  We have now got one narrow, very clearly defined power which allows the security services to link names to numbers and nothing else. I think that’s good for security and strikes a balance between the security of the nation and the liberty of the individual.

DM: Secretary of State, thank you very much indeed. Alistair Carmichael there, Secretary of State for Scotland.