Tories cut spending plans as poll lead slumps to 3 points

Pledge to match Labour commitments abandoned to fund 'permanent' tax cuts

David Cameron ditched the Conservative Party's pledge to match Labour's public spending totals yesterday in a significant U-turn that will allow him to offer "permanent" tax cuts at the next general election.

The Tories changed tack after being outflanked by Gordon Brown, who is seeking big tax cuts in Monday's pre-Budget report (PBR) to soften the impact of the looming recession.

Mr Brown's revival was underlined by an Ipsos MORI poll showing the Conservatives' lead has slumped to just three points. It puts the Conservatives on 40 per cent (down five points on last month), Labour on 37 per cent (up seven points) and the Liberal Democrats on 12 per cent (down two points).

Admitting that parts of his economic strategy were "obsolete" because of the downturn, Mr Cameron promised to spend less than the £680bn pencilled in by the Government for the 2010-11 financial year. Previously, the Tory leader had matched Labour's plans for the next three years to insulate his party against the allegations of "Tory cuts" which have damaged it at the last two elections.

At the next election, the Tories will contrast their desire for permanent tax cuts with the tax rises they say would inevitably follow a Labour victory. A Tory government would allow state spending to grow by less than the 2.3 per cent real terms increase planned by Labour through savings in government programmes and cutting waste.

However, the Cabinet is already moving to curb the Conservatives' room for manoeuvre. Yesterday ministers identified Whitehall efficiency savings of a few billion pounds on top of the £30bn already in the pipeline over the next three years. The Chancellor, Alistair Darling, is expected to announce on Monday that the savings will be used to limit the increase in borrowing.

Mr Cameron's refusal to offer upfront tax cuts since becoming Tory leader angered many in his party and left him dangerously isolated both at home and abroad as countries backed a "fiscal stimulus" to boost their flagging economies.

Labour claimed the Tories would give the British economy "a slap in the face" rather than "a shot in the arm". Gordon Brown said: "The only group that is setting their face against necessary help for families and businesses now is the Conservative Party."

In a setback to the Tories, the Confederation of British Industry said: "There is a case for a well-targeted, controlled and time-limited fiscal stimulus in the immediate future."

The Tories denied a U-turn but admitted they had made an "adjustment" to their policy, saying there were now "clear blue lines" between the two main parties. Tory sources suggested that Labour's health and overseas aid budgets would not be cut but declined to make the same pledge on education or defence. Final decisions will be made after the PBR.

Mr Cameron said Labour would tell "lies" about "Tory cuts" but insisted that spending would merely rise more slowly under a Tory government than a Labour one. He said that Labour's "unsustainable" rise in borrowing meant the Tories could no longer justify matching its spending plans. "Gordon Brown is trying to find an international cover for what he wants to do for electoral and political reasons in the UK," he said.

The Tory leader said other ministers, but not Mr Brown, had admitted taxes would have to rise in the medium term. He cited Mr Darling's interview in The Independent last week in which he said that "at some stage you have to pay" for the extra borrowing.

In a speech in London, Mr Cameron promised to be honest about the economy even if that meant saying things that were not immediately popular. "That we can't afford a massive tax giveaway paid for by a borrowing binge; that we can't afford a spending splurge," he said. "It means arguing for things that are difficult. For prudence, not giveaways.

"I don't believe we can afford it. I don't believe it will work. And I believe it means running risks that we should try to avoid."

Nick Clegg, the Liberal Democrat leader, said the Conservatives' announcement was "economic madness". He added: "David Cameron has learnt nothing. It's exactly what the Conservatives did in the 1980s. To simply slash public spending when we are heading into a recession – there's no case for it whatsoever."

Clear blue lines: Tax policies


* Would no longer match Labour's spending totals from 2010-11 financial year onwards

* Would make "permanent" the "temporary" tax cuts Labour will make to limit downturn, through savings and lower spending than planned

* Claim they are now the party of "prudence" and "fiscal responsibility"

* Reject Labour's "borrowing binge"; would still protect health and overseas aid spending


* Would spend £680bn in 2010-11 (up 2.3 per cent in real terms); rising to £710bn and £744bn in the following two years

* Immediate tax cuts to keep economy moving, funded by higher borrowing

* Possible tax rises in medium term

* Would use new Whitehall efficiency savings to limit rise in borrowing

*Warns that the Tories would cut vital public services

Andrew Grice

The reaction: What the bloggers say

* Fraser Nelson, Coffee House, Spectator – The Shadow Cabinet members I've spoken to are hugely encouraged, seeming as if an artificial constraint has now been lifted from them. There is a feeling of "game on".

* Iain Dale – I'm delighted by David Cameron's announcement this morning that the pledge to match Labour's spending plans for 2010-11 has been abandoned. In his speech he annunciated very clearly that the Conservative approach to the financial crisis will be based on sound money, with no unaffordable spending or borrowing.

* Guido Fawkes – He has set reasonable objectives. Not a lot of excitement, but a reasonable attempt to take control of the news agenda.

* Andrew Lilico, ConservativeHome – Good! It was a long time coming, but no less welcome for that. It's also good that today's commitment was free-standing – not a consequence of some tax commitment.

* Tory Bear – Cameron has finally hit the nail on the head this morning and offered a clear narrative of Labour's failings on the economy and what the Conservatives would do about it. No more ridiculous ideas of matching Labour spending plans.

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
ebooksA celebration of British elections
  • Get to the point
2015 General Election

Poll of Polls

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

Guru Careers: Software Engineer / Software Developer

£40-50K: Guru Careers: We are seeking an experienced Software Engineer / Softw...

Ashdown Group: Trainee Consultant - Surrey/ South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Ashdown Group: Trainee Consultant - Surrey / South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Ashdown Group: Recruitment Consultant / Account Manager - Surrey / SW London

£40000 per annum + realistic targets: Ashdown Group: A thriving recruitment co...

Day In a Page

Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before