Tory modernisers warn Duncan Smith not to neglect public services in favour of tax cuts

Iain Duncan Smith was accused yesterday of a "panic" response to poor poll ratings after appearing to signal a change in strategy by restoring tax cuts to the top of the Conservative Party's agenda.

The party leader risked angering Tory modernisers when he argued that tax cuts and reducing red tape would be the top priority for future elections.

John Bercow, a Tory MP who resigned from Mr Duncan Smith's Shadow Cabinet on 4 November in protest at its opposition to adoption by gay couples, said yesterday that more policy U-turns could spell disaster for the party.

He warned against repeating William Hague's failed attempts to win more votes by abandoning his reforming agenda. "I am very sceptical about this. It is important that we are not diverted from the straightforward message that Conservatives are committed to public services and that it is our top priority to find ways of improving them," he said. "In the last parliament one of our big mistakes was to panic and opt for a simple pitch to the core vote. It didn't work then and it would not work now. I sincerely hope Iain will avoid that trap."

Ministers and the Liberal Democrats accused the Tories of desperation tactics to attract more support as a poll showed more than half the electorate believed the Liberal Democrats would overtake the Toriesin five years' time. The poll also showed more voters would back the Tories if Kenneth Clarke replaced Mr Duncan Smith as leader.

Yesterday, Mr Duncan Smith saidhis party was not yet a "credible alternative" to Labour. He appeared to make a fresh pitch for votes by re-positioning the Tories as a tax-cutting party. "I know this much: as an abiding principle an incoming Conservative government will be a lower-tax, lower-regulation government than this Government is," he said in an interview with The Sunday Times.

His comments were made as leaked Tory documents showed their own advisers believed Mr Duncan Smith was "unelectable, not normal, has no character, and is patronising to the less well off".

The reports, written by pollsters Live Strategy and ICM, said voters believed he enjoyed the company of "cronies, white men, army officers, definitely not anyone normal".

Yesterday Michael Howard, the shadow Chancellor, who has argued for the Tories' public-service reform agenda to be the focus for voters, denied Mr Duncan Smith had dumped the commitment to improve health and education provision. In an interview with The World This Weekend on BBC Radio 4, he played down the prospect of early tax cuts if the Tories won the next election. "A Conservative government will always be a lower tax government than a Labour government, but we have to sort out the public services and that means I can't, as shadow Chancellor, say today in my first Budget we will definitely cut taxes," he said.

Mark Oaten, the chairman of the Liberal Democrats' Parliamentary Party, accused Mr Duncan Smith of hypocrisy for trying to win votes with a tax-cutting pledge. "It's a sign of panic measures and a last-ditch attempt by IDS to save his leadership,' he said

Labour accused the Tory leader of overturning pledges to invest in public services.

Paul Boateng, Chief Secretary to the Treasury, said: "Iain Duncan Smith has clearly overruled Michael Howard, Oliver Letwin and Liam Fox and he has ditched any notion of matching Labour's investment on education or the NHS."