Tory Andrew Tyrie calls for 'coherent' economic plan

Andrew Tyrie said there should now be a relentless focus on improving living standards

The government is not doing enough to promote economic growth, a prominent Conservative party figure has said.

Commons Treasury Committee chairman Andrew Tyrie called for tax cuts for business and questioned government initiatives, such as the Big Society.

He said some initiatives "have seemed at best irrelevant to the task in hand, if not downright contradictory to it".

Chancellor George Osborne has suggested there might not be tax cuts before the next general election.

Some of Mr Tyrie's views would be shared by other Tory backbenchers, former Conservative cabinet minister John Redwood told the BBC.

According to Mr Tyrie - who chairs the cross-party treasury group of MPs - the government is pursuing policies more suited to an age of abundance rather than austerity.

He does support the coalition's strategy to reduce the public deficit, saying it is both necessary and correct.

Living standards

But in the pamphlet for the pro-free market think tank, Centre For Policy Studies, he said the government had to review its positions on the reform of public services, the increase in overseas aid and some aspects of its environmental agenda.

The pamphlet, called It's the Economy, says: "Without the lynchpin of a clear strategy for growth in place, other attempts to provide a more appealing theme than austerity are unlikely to succeed.

"The Big Society; localism; the Green strategy - whether right or wrong - these and other initiatives have seemed at best irrelevant to the task in hand, if not downright contradictory to it; likewise the huge spending hike on overseas aid and the cost of the Libyan expedition."

He said instead there should now be a relentless focus on improving living standards.

Mr Tyrie called for the tax system to be simplified and business taxation to be reduced, and said he wanted to see fewer regulations and changes to labour laws.

"There is much to do, and it is not just a question of gaps in policy; in places it is inconsistent, even incoherent," he wrote.

"A much more coherent and credible plan for supply-side reform to improve the long-term economic growth rate of the UK economy is now needed."

The issue is likely to dominate at the Conservative Party conference which begins in Manchester on Sunday. Economic policy is being debated on Monday.

John Redwood said: "I think Andrew Tyrie speaks for a lot of Conservatives when he says that he thinks that some of the spending priorities are not appropriate for current austerity Britain and that we need to make stronger strides to get the deficit down by controlling spending.

"I think the 30 billion [pound] increase in current public spending last year was rather a large increase in the circumstances."

He added that Mr Tyrie's views on tax would also be shared by party members.

"If we're going to tax the rich more and get more money in from a growing economy we need to set competitive rates."

'Enterprising economy'

Mr Osborne said the possibility of tax cuts depended on "how things develop" between now and the next general election.

In an interview with the Daily Telegraph, the chancellor said tax cuts "should be for life not just for Christmas".

"We'll see how things develop in the rest of this parliament," he said.

"I'm a Conservative who believes in lower taxes. They lead to a more enterprising economy.

"But I'm not somebody who believes you can fund lower taxes by borrowing more money because that is a deceit and the public are smart enough to see straight through it."

Shadow treasury minister Chris Leslie said Labour had better policies for growth than the government, and he called on the chancellor to listen to Mr Tyrie, particularly as external agencies - such as the International Monetary Fund and the business grouping CBI - had also said more growth was needed.

"[The Conservatives have] really got to get off the fence and make sure George Osborne really realises that jobs and growth are in real trouble in this country and he needs a coherent plan."