Let the good times roll, says Major

John Major will today offer former Tory voters the clearest indication yet that he is counting on a pre-election spending boom to win back their support.

The Prime Minister told last year's Conservative Party conference that he and his Chancellor, Kenneth Clarke, wanted nothing more to do with the "boom and bust" economics, associated with Margaret Thatcher.

But in a direct mailshot appeal to more than 2 million disaffected voters who need to be won back if the Tories are to hang on to their most marginal seats, Mr Major offers the prospect not only of rising living standards, but sweeping tax cuts - and rising house prices.

In a move that will confirm the worst fears of City analysts who have detected signs of a return to old, political habits, Mr Major says the good times are back again.

The letter, targeted at Tory doubtfuls, repeats the Prime Minister's "dislike" of putting up taxes after the last election. "But it was necessary to put our economy on an even keel," he says. "And it has worked."

As a result of the "tough decisions", Britain had had the fastest growth of any major European nation since 1992; the longest period of low inflation for 50 years; the lowest mortgage rates for more than 30 years; and unemployment falling for more than three years. "House prices are rising again," Mr Major says. "People's living standards are rising." He then adds that April's income tax cuts were "an important start" on the tax-cutting programme.

"Lower taxes do not just mean you can spend more of your own money," he says. "They are absolutely essential for a strong economy - because they stimulate enterprise and growth." Ignoring the fact that the tax burden has been increased by the Conservatives, Mr Major says: "Britain today has the lowest tax burden of any major European country ... But this is still not enough. The British economy will do better still when taxes can be cut further. As soon as we can prudently afford it, they will be.

"I think people would welcome even more help to pay the bills they face each week. And lower taxes will help them do that."

Gordon Brown, the shadow Chancellor, said last night: "No amount of letters, and no amount of lies, will erase people's memory that they were promised tax cuts year on year by the Conservatives at the last election - and were then forced to suffer the biggest peacetime tax rise in history. "They lied about tax then, and they are lying now."

Brian Wilson, head of Labour's campaign unit, said: "You would never guess from all this that the share of the average family's income going on tax is higher now than it was in 1979."

Mr Major told his party conference last year: "Neither Ken nor I, ever again, want to see us go through that boom and bust cycle that causes so much pain and so many lost hopes."