Bruce throws down tax gauntlet to Blair



Political Correspondent

The Liberal Democrats threw down the gauntlet to Tony Blair yesterday as Malcolm Bruce, the economic spokesman, challenged Labour to vote against "short-term" tax cuts in the November Budget. Pledging his own party to oppose "cynical short-term tax bribes", Mr Bruce said long-term investment must come first, and lower interest rates should come before higher borrowing. "That's my message to Ken Clarke [the Chancellor] today."

Addressing the conference the day after Mr Blair delivered a pledge of greater co-operation between the two parties both before and after the next election, Mr Bruce challenged the Labour leader: "Tony, if you really want to co-operate, join us in the lobbies and show you are prepared to vote with us for our children's future."

The Liberal Democrats are pledged to a 1p increase in income tax if that is needed to pay for pounds 2bn improvements in education, and to a 50 per cent top rate of tax for people earning more than pounds 100,000.

Mr Bruce, who is less enamoured than some with the idea of closer links with Labour, said afterwards that the Liberal Democrats were committed to voting against a deliberate government decision to reduce the net tax take, for example by cutting the standard rate.

The picture could, however, be complicated if the Chancellor combined a cut with raised tax thresholds or other measures to help the low paid, which the Liberal Democrats support.

Citing justifications for the stand on tax-cutting, Mr Bruce announced a petition to make the Budget an "education Budget test for the Tories", while attacking the proposed savaging of spending on overseas aid.

But the most rousing applause came when Mr Bruce reaffirmed his party's pledge to buy back a 51 per cent majority share in Railtrack if it is sold off before the election - a further area over which Labour has made no specific commitment and in which the Liberal Democrats are attempting to wrong-foot Mr Blair.

Dramatically revising a previous estimate of the cost of reversing the sell-off from pounds 5bn down to just over pounds 1bn, Paul Tyler, the transport spokesman, later told the conference that Mr Blair's "hot air" was proving dangerous. "By refusing to be specific, by failing to distinguish between Railtrack and individual support companies or service provision, the Labour leadership is risking the loss of the whole rail system. We know that his transport spokespersons take differing views,"he said.

The economic policy paper, Investment, Partnership, Sustainability, passed by the conference yesterday constitutes a definitive statement of Liberal Democrat economic policy for the next election and forms one of the three priority areas marked out in the party's Liberal Democrat Guarantee.

The economic pledges include ensuring that over the course of the economic cycle, borrowing is only used to finance capital expenditures, the establishment of an operationally independent but democratically accountable U K reserve bank charged with keeping inflation under 3 per cent, investment allowances to small and medium-sized businesses of up to pounds 200,000 a year, statutory regulation of financial services, and a massive switch of taxation towards pollution and away from jobs.

On the issue of long-term unemployment, the conference backed a proposal for a Benefit Transfer Programme to convert welfare benefits paid to the long-term unemployed to vouchers payable to employers who took them on.

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

SThree: Trainee Recruitment Consultant

£13676.46 - £16411.61 per annum + Uncapped OTE: SThree: Trainee Recruitment Co...

Recruitment Genius: Office Manager - Part Time

£16000 per annum: Recruitment Genius: This digital agency based in Ashford, Ke...

Recruitment Genius: Sales and Marketing Executive

£19000 - £25000 per annum: Recruitment Genius: This is an opportunity to join ...

Recruitment Genius: Technical Author / Multimedia Writer

Negotiable: Recruitment Genius: This recognized leader in providing software s...

Day In a Page

Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
Tourism in Iran: The country will soon be opening up again after years of isolation

Iran is opening up again to tourists

After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there
10 best PS4 games

10 best PS4 games

Can’t wait for the new round of blockbusters due out this autumn? We played through last year’s offering
Transfer window: Ten things we learnt

Ten things we learnt from the transfer window

Record-breaking spending shows FFP restraint no longer applies
Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

‘Can we really just turn away?’

Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

Nine of Syria and Iraq's 10 world heritage sites are in danger...

... and not just because of Isis vandalism
Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

Girl on a Plane

An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
Why Frederick Forsyth's spying days could spell disaster for today's journalists

Why Frederick Forsyth's spying days could spell disaster for today's journalists

The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent