Vince Cable says Conservatives 'lying' over tax pledges

Business Secretary Vince Cable has accused the Conservatives of "lying" by claiming they can eliminate the budget deficit without the need for tax rises.

He told the Lib Dem conference the Conservative Party was "obsessed" with spending cuts, with many public services already "cut to the bone".

And he said the Lib Dems could "not go along with" Conservative proposals for £25bn of further spending cuts.

The Conservatives said voters would decide on their tax plans next May.

They have pledged to eliminate the deficit without increasing taxes.

In a speech which saw his most outspoken attack yet on his party's coalition partners, Mr Cable said: "The Tories are ideologically obsessed by cuts. They see it as a way of destroying public services and the welfare state, which they detest.

"Any politician who tells you that the next government can balance the budget and avoid tax increases is lying to you."

In other developments at the conference:

• Deputy PM Nick Clegg said David Cameron's plans to renegotiate Britain's relationship with Europe would turn out to be "largely synthetic"

• Mr Clegg unveiled proposals to build 50,000 new homes at towns along the route of a re-opened railway line between Oxford and Cambridge

• Health minister Norman Lamb warned the Lib Dems to think twice before going into coalition with Labour while Ed Miliband was its leader

• Mr Cable said airport expansion at Gatwick was "a preferable alternative" and "less problematic" than expansion at Heathrow, which is near his Twickenham constituency

• Lib Dem delegates backed calls for a review of Universal Credit; reform of the Hardship Fund; changes to the Work Programme; an easing of benefit sanctions and more support for claimants

After his speech Mr Cable told BBC Radio 4's The World at One "any government" would have to include tax rises in its strategy.

Services like the British Army or the police were "already operating very close to the edge", he said, adding: "It simply isn't possible without doing enormous harm to achieve the deficit reduction simply by spending cuts alone, and that is why I made the strong statement I did."

The business secretary said the Conservatives had set out some tax cuts, but said he was "pretty confident" they would have to increase "other taxes" if they took office.

David Cameron promised a balanced budget and tax cuts at the Conservative conference

Asked whether the Conservative plans for £25bn of spending cuts would be a "red line" in any future coalition negotiations, he said it was "a fundamental area of difference" but added that he was not discussing the scenario of future coalitions.

BBC political editor Nick Robinson said people would "raise an eyebrow" at Mr Cable's comments about his coalition partners.

The language used would be "hard to simply paper over", he added.

A Conservative Party source said: "We respectfully disagree with Mr Cable - if the Lib Dems want to argue for tax increases on working people, then we will make our case for tax cuts to the electorate."

In his speech, Mr Cable said more taxes would be needed, but added that public borrowing for investment was a "no brainer".

The business secretary also said banks were "still taking more money out of small and medium sized companies than they are putting in".

Mr Cable told the conference the Lib Dems had joined the coalition "because there was a national economic emergency".

Nick Clegg and Vince Cable had a chat in the audience before the speech

"We worked with the Tories because voters chose them as the largest party - not because we liked them, or because we are like them."

The party has "abandoned the politics of perpetual protest", he said, crediting leader Nick Clegg with this "massive transformation".

One of the other areas of policy which Mr Cable highlighted as being different between the parties was immigration, saying the "uncomfortable truth" was that the "vast majority" of migrants benefited the economy.

"Our party has a massive responsibility - to be the voice of sanity, seriousness and sense. Standing up to the purveyors of panic, prejudice and pessimism."

Minimum wage

He also proposed a pay rise for apprentices, to come into effect next October, if cleared by regulators.

Mr Cable said he was writing to the Low Pay Commission recommending that the apprentice rate of the minimum wage and the 16/17-year-old rate be combined.

Most apprentices already earn more than the minimum wage but about 31,000 people are expected to benefit from the move, with their hourly rate going up from £2.73 to £3.79.

The £1.06 hourly increase is backed by the Conservatives.

Nick Clegg and his wife Miriam visited a Glasgow school on Monday morning

Labour's shadow business secretary Chuka Umunna said: "You can't trust Vince Cable and the Liberal Democrats. They broke their promises and have been too weak to stand up to the Tories."

He pointed to the increase in tuition fees and said working people were £1,600 a year worse off since 2010.

The Conservatives have accused the Lib Dems of "trying to wriggle out of" making £25bn in cuts and asked how the Lib Dems would find the savings the Conservatives plan to make with a benefit freeze.

On the proposal to raise apprentices' pay, Katja Hall, deputy director general of business group the CBI, said it was "unwise" to increase the cost to firms of taking on young people, saying it would "put off many smaller firms from getting involved".

The Lib Dem conference has been dominated by attacks on the Conservatives, with former leader Sir Menzies Campbell even stepping in to urge his colleagues to rein-in their "extravagant" language.

What has upset senior party figures the most are Conservative plans - announced last week - to freeze working-age benefits and raise the threshold of the 40p income tax rate.

BBC assistant political editor Norman Smith said Mr Cable's comments were the latest move by a senior Lib Dem to distance themselves from their coalition partners.

Lib Dem president Tim Farron accused the Conservatives of being "borderline immoral" for trying to "balance the books on the back of the poor".

At the Conservative conference last week Chancellor George Osborne said "the option of taxing your way out of a deficit no longer exists, if it ever did".

He said the UK was the fastest-growing economy of any developed nation and said the Conservatives "here resolve that we will finish the job that we have started", in getting the economy on track and eradicating the deficit.