Only we can rescue Britain from turmoil, says Clegg

Only the Liberal Democrats can rescue Britain from its economic "mess", Nick Clegg declared today in a bid to snatch hard-pressed voters from Labour with promises of tax cuts.

He wrapped up his first conference as leader with a bid to exploit the turmoil surrounding Gordon Brown and present his party as the only one with firm policies to ease the effects of the credit crunch.

"We are the party with the ideas that can get Britain out of this mess," he told activists in Bournemouth who earlier this week backed his plans for tax reductions paid for by public spending cuts despite left-wing dissent.

"What Britain needs now is absolute honesty about the situation we're in and big, bold ideas to set us right. Quite simply we need a government that listens, understands, and acts.

"And you know what? The Liberal Democrats can be - will be - that government."

Mr Clegg set out an economic recovery plan, including the measures to lower tax bills for low and middle earners and action to avoid home repossessions and end the "free-wheeling, bonus-driven, short termism of the City".

Nine out of ten taxpayers would be better off under the party's programme, which would be the most progressive and redistributive ever proposed by a British political party, he claimed,

A 4p cut in income tax would be paid for by axing pension reliefs and tax loopholes for the super-rich and increased green taxes while further reductions would come out of £20 billion on Whitehall savings.

"The other parties say tax cuts aren't possible. But that's because they're too flaky to take the tough choices.

"Too weak to trim back on wasteful spending. Too in hock to wealthy non-doms to threaten higher taxes for the rich."

Ministers offered no solutions to the worsening situation because they were too busy fighting among themselves over the Labour leadership like a bunch of "zombies", he said, as more Labour dissenters broke cover.

"They're so desperate to protect their own jobs, they can't be bothered to protect other people's. They are the living dead - no heart, no mind, no soul - stumbling around with no idea what to do.

"All these backbenchers and ex-ministers you've never heard of, rising up from the grave of obscurity to impale their Gordon Brown."

But the Tories, whose revival threatens many Lib Dem seats in the south, were a "say everything, do nothing party" which in office would disappoint as New Labour had before, he told the conference.

"New Labour failed. But there is a new, New Labour on the block: Blue Labour - the Conservative party," he said. "Let our country not be fooled again."

In a direct appeal to disaffected Labour voters, he concluded: "If you were drawn to Labour in the 1990s because you believed in a better future, because you were filled with hope that things would get better, join us. We are the ones who can make it happen.

"Labour is finished. It's over. The Liberal Democrats are now the only party that can deliver social justice. The only choice for anyone who wants a fairer Britain.

"A party that will put money back in the pockets of ordinary families. A party that will build a stable, green economy for each and every one of us. A party that will change politics so that every person counts."

The party will attempt to press home the point after the speech is finished with a blitz of 250,000 automated phone calls to homes in 50 marginal seats.

In a polling technique copied from the US, recipients will hear a recorded message from Mr Clegg and be asked to give their verdict on his policies using their keypads.

"These are difficult times: our economy weakens by the day; we survive on oil and coal we cannot afford, from nations we cannot trust," Mr Clegg told the conference.

"A firestorm is raging through our financial system, ignited by reckless bankers and fuelled by complacent politicians.

"We can't predict the future. We can't know exactly what challenges our country will face. But we can be certain that Labour cannot help us. And we can be certain that the Conservatives won't bother."

Outlining his "Fairer Future economic recovery plan", he called for action to stop the "amoral culture that sees speculators betting on banks to fail, knowing the taxpayer will pay out in the end.

"And the madness of bonuses awarded no matter what."

He went on: "We will put in place the building blocks for future economic stability. Interest rates that take house price changes into account and independent monitoring of our fiscal rules.

"And finally - but most importantly - tax cuts for families who are struggling to help them make ends meet and keep the wheels of the economy turning.

"I know with this approach - streamlined spending and targeted tax cuts, we can get our economy going again."

Mr Clegg's clear victory over party traditionalists in committing the party to finding ways to reduce public spending to fund tax cuts set an important marker for his nine-month leadership.

Despite committing one serious gaffe by showing on television that he had no idea how much the state pension was worth, he has enjoyed a solid week.

But fears that he is failing to spread that appeal beyond the party to the public at large have also been expressed, not least by deputy leader Vince Cable.

In his speech Mr Clegg said he wanted "politics to connect with people again" - and the party hopes the quarter of a million phone calls being placed this evening will help.

Mr Clegg had taken to the stage after a video of parliamentary "greatest hits" from Commons question time.

There was a standing ovation to welcome him after stagehands worked frantically to remove a lectern only seconds before the leader emerged.

Wearing a microphone on each lapel of his suit, he wandered round the stage reading his speech - unusually short for a keynote address at just under 38 minutes - from an autocue.

His promise of a green economy and the assertion that Labour was "over" drew the biggest applause, before an enthusiastic four-minute standing ovation at the end.