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Saturday, March 10, 2012

Clegg needs to match words with actions

I am not at the Liberal Democrat Federal Conference in Gateshead. It is a long way to go for what is essentially an English policy event, especially when there is plenty to do at home in preparation for the local elections.

That does not mean that I am not watching events as they unfold and particularly the spin being put on Nick Clegg's speech. According to the Telegraph the Liberal Democrat leader will be using the occasion to call for the introduction of a “tycoon tax” which will mean that wealthy Britons have to pay a minimum rate of tax on their total annual earnings of between 20 and 30 per cent.

Putting aside the fact that when I first heard this on the radio this morning, I though he was referring to a tax on typhoons, this seems like a good idea. It will certainly help to delineate Liberal Democrat distinctiveness within the coalition. After all if there really is evidence that hundreds of millionaires are paying a tax rate of less than 20 per cent on their earnings by using an “army of lawyers and accountants” then we need to take corrective action.

When thousands more millionaires pay tax at a rate of less than 30 per cent, depriving the Exchequer of hundreds of millions of pounds a year, then it is right that a specific minimum rate of tax should be written into law to ensure people are “paying their fair share” and not “massaging” the system.

However, Nick Clegg should not fall into the trap of thinking that by stating this line, it enables him to claim the moral high ground. The days when Liberal Democrat leaders could get credit amongst voters for progressive policies just by reading out a speech at the podium of a conference are long gone.

We are in government and if we state that we want to do something from a position of power, then we will be expected to implement it. Presumably, the Liberal Democrat leader has thought of that and has a delivery plan sorted out with the Tories for this new policy.

It is fine to argue that we have had to compromise on our manifesto because we are in coalition and do not have a majority, but when Government Ministers start initiating policy ideas they have to be much more precise. Is this an aspiration for the next manifesto or can we really deliver on it over the next few years? That is the distinction that I want Nick Clegg to be clear on today.
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