Lib Dem Response: Campbell attacks 'complacency' on green issues

Sir Menzies Campbell attacked Gordon Brown's Budget as a missed opportunity to deal with pensions, the environment, debt and tax as he accused the Chancellor of merely "tinkering" with the tax system.

He used his first budget outing as Liberal Democrat leader to attack the Chancellor for "complacency" on green taxes and condemn Mr Brown for failing to tackle inequality in Britain.

The Liberal Democrat benches were packed as their new leader delivered a measured speech in contrast to the noisy attack delivered by David Cameron.

Sir Menzies said: "This Budget was an opportunity. In a period of relative stability, with low inflation and stable employment, the Chancellor had an opportunity to show his worth. He could have tackled the unfair tax system. He could have made the environment a priority. He could have faced up to the pensions crisis. He could have addressed the problem of personal debt. He has declined to do any of these. This is a legacy from which it will be difficult for him to escape."

He attacked the Chancellor for failing to address the environmental impact of continued expansion of aviation and derided the proposed reform of road tax as amounting to "rather less than the cost of half filling the petrol tank".

"Under this Government green taxes have fallen as a share of overall taxation. The measures that are announced today will make little impact upon that. What is needed is simplicity in environmental taxation, a proper system of green economic incentives that encourage people to change the way they live and to change their habits and to express the implement the principle that the polluter should pay."

Sir Menzies attacked the council tax as "the most unfair, regressive tax of all" and criticised Mr Brown for failing to introduce reforms. He said: "Having read the Red book we can confirm there is no provision this year for the £200 rebate which was made available last year.

"If there is no council tax rebate then we know that some of the most vulnerable will suffer. But they will pause and ask themselves this: why was it they deserved help immediately before a general election but don't deserve any help a year later?"

Sir Menzies said: "Why does he tinker with the tax system when it is so fundamentally unfair and requires radical reform. And every time he tinkers, he adds layer upon layer of complexity, an incitement to fraud."

The Liberal Democrat leader warned that booming personal debt could be a "disaster" for many families, warning that it was "back to the level it was when the economy crashed under the Tories in the early 1990s". He lambasted the Treasury's targets for public services, warning that the government will be announcing real terms cuts in most government departments next year and insisting that increased spending had yet to reach the front line.

Sir Menzies said: "The British people wanted better public services and were willing to pay for them. What they simply don't understand is how so much has been spent with so little to show for it. With operations cancelled, with wards closed and local hospitals threatened with closure and even nurses being made redundant."

Alex Salmond, the leader of the Scottish Nationalists, said the budget showed that North Sea revenues would provide an estimated £74bn in revenues this year. He said: "The next stage of London's great oil and gas robbery is laid bare. £74bn is due to pump south into the Treasury coffers, equal to £14,000 for every man, woman and child in Scotland. That is money that will be lost to Scotland unless we take responsibility for our oil revenues and future economic success."

Adam Price, economic spokesman for Plaid Cymru, said: "Under Labour, the economy of Wales has been dismissed, as they are preoccupied with winning Tory votes in the South East of England. Year after year, the wealth of the people of Wales compared to the UK average has fallen dramatically."

* Treasury Budget site

* Chancellor's Statement in full