Danny Alexander interview: I heard a senior Tory tell a Lib Dem colleague 'You take care of the workers and we'll take care of the bosses'

Exclusive: The controversial remark was revealed by Danny Alexander, the Chief Secretary to the Treasury, in an interview with The Independent

Danny Alexander (Getty)

A senior Conservative minister told a Liberal Democrat cabinet colleague: “You take care of the workers and we’ll take care of the bosses” in a private Whitehall meeting to discuss the Coalition Government’s priorities.

The controversial remark was revealed by Danny Alexander, the Chief Secretary to the Treasury, in an interview with The Independent that exposes some of the behind the scenes tensions in the Coalition Government.

Mr Alexander said it showed David Cameron and George Osborne were guilty of “breath-taking hypocrisy” for trying to claim responsibility for raising the threshold at which people pay tax – while privately arguing for tax cuts for the better off.

“In March 2012 when the economy was still in the very early stages of recovery we wanted to do a very big increase in the personal allowance to put a lot of money back into folk’s pockets,” he said. “The Tories priority at the time was the top rate of tax.

“I remember one meeting with a group of senior Conservatives and one of them said ‘listen you take care of the workers and we’ll take care of the bosses’.

Mr Alexander’s remarks come as Mr Osborne yesterday four times refused to rule out cutting the top rate of tax paid by people earning over £150,000 a year from the current rate of 45p to 40p in a pound if the Conservatives win the next election. (Getty Images)

“That was said across the table in one of the meetings where we were discussing the forward policy of the Government. That really spelt out where their priorities lay.”

Mr Alexander did not reveal the identity of the Conservative who made the comments but The Independent understands that they were a senior Cabinet Minister involved in negotiating Government policy with the Lib Dems.

Today marks the start of the new financial year when the personal tax free allowance will rise to £10,600 – over £4,000 more than it was in 2010. The Lib Dems cite the rise as one of the party’s biggest achievements in power and have become increasingly angry at Conservative attempts to take credit for it.

In the interview Mr Alexander revealed that in private senior Tories had used the Lib Dems insistence on increasing the personal allowance as a bargaining chip to reduce taxes in other areas.

“We put increases in the personal allowance on the front page of our manifesto in 2010. The Conservatives didn’t even mention it their manifesto,” he said.

“Nick Clegg pushed it in the TV debates at the last election while David Cameron said that it couldn’t be afforded. At each and every Budget and each and every Autumn Statement we have fought for the personal allowance and consistently made that our priority.

“The Conservatives have swithered around from one thing to the other: (cutting) Corporation tax, (introducing) the marriage tax allowance, the shares for rights scheme, cutting the 50p rate.

Mr Alexander’s comments come as the Labour Shadow Chancellor Ed Balls prepares to make a speech attacking the government’s choices on tax, saying that under the Tories “millions pay more while millionaires pay less.” (PA)

“It is interesting that the things that they pushed in Government are not the things that you hear them mention anymore. You don’t hear the Tories campaign on shares for rights or tax cuts for the wealthy yet those were the things that they pushed as part of this process.”

Mr Alexander added: “The Tories are now trying - in a way which is breathtakingly hypocritical – to take the credit for raising the tax free allowance, something that actually only happened because the Liberal Democrats put it on the political agenda.

“It is only happening because in each and every one of these meetings we said we can’t spend money on this tax break for the wealthy. At every stage we’ve got to make sure that the biggest thing that we’re doing is cutting taxes for working people. We have looked after working people – they have tried to look after the bosses.”

Mr Alexander also claimed that the Tories blocked plans to introduce an extra charge on high value properties – a so called mansion tax - out of concern for alienating the party’s donor base.

“We pushed the idea that there should be an additional tax on the highest value properties at two or three budgets at least,” he said. “At every stage the Tories rejected that. They have been pretty clear that it is something that their donors don’t like. They have been using it ruthlessly to get more money from these donors. It’s been pretty transparent that what’s been going on is that their backers don’t like it.”

Mr Alexander’s comments come as the Labour Shadow Chancellor Ed Balls prepares to make a speech attacking the government’s choices on tax, saying that under the Tories “millions pay more while millionaires pay less.”

“David Cameron and George Osborne (have) ditched the idea that we are ‘all in this together’ and looked after their friends first,” he will say.

“Cutting the top rate of tax for the very highest earners, while raising VAT on families. It’s the Tory way: millions pay more, millionaires pay less.”

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