Everyone we interviewed in Whitehall says how much more harmonious the coalition is compared with the rivalries and infighting of the Blair/Brown years. After widespread fears that coalition government would be weak, quarrelsome and divided, in the first year the coalition has proved remarkably stable and united. Cabinet government has been revived; but coalition issues are mainly resolved in informal forums, with weekly meetings between Clegg and Cameron, and regular get togethers between Danny Alexander and Oliver Letwin. The mutual trust and close working relations developed not just between Clegg and Cameron, but amongst all their top advisers, should help the government as it faces tougher times ahead.

And how could the Lib Dems do better? Our report recognises the formidable difficulties they face, in particular because their resources are so stretched. With the loss of Short and Cranborne money, there is no longer state funding to support the party in Parliament. The staff in Cowley Street is severely depleted, with only four press officers where there used to be 13. Lib Dem junior ministers struggle to maintain a watching brief across the whole of their departments, with only a small Private Office. In the absence of any more Special Advisers, they should be given additional policy advisers by the civil service - additional support which has been provided in a couple of departments.

The key challenge for the Lib Dems is to demonstrate greater distinctiveness, without undermining the underlying unity of the government. That will never be easy for the coalition's junior partner. But they do need to rethink their original strategy of going for breadth rather than depth. The ambition was to influence the whole of government policy. Lib Dem ministers may indeed have achieved hundreds of policy wins, but these are invisible to the public. So instead of spreading themselves thinly across the whole of government, they need to prioritise their effort on areas where they can more clearly have an impact. The lead needs to come from the top, with Nick Clegg himself setting clearer strategic priorities.

Read the full report - Inside Story: How Coalition Government Works.

Professor Robert Hazell is Director of the Constitution Unit at University College London.