Lib Dems would cut spending from 2011
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The Liberal Democrats say the economy will be ready for spending cuts from 2011, when they would introduce a banking levy forcing banks to pay for the financial support they have received.
The Lib Dems’ manifesto, published today, says if elected the party would split retail banking from investment banking and establish a cross-party Council on Financial Stability.
On pensions, the Lib Dems say they will immediately restore the link between basic state pension and earnings and increase the state pension annually by whichever is greatest - growth in earnings, growth in prices or 2.5 per cent.
They have also pledged to scrap compulsion to buy an annuity at age 75, give people early access to their pension funds in times of hardship and introduce a citizen’s pension, paid to all UK citizens who are long-term residents, when resources allow.
The Lib Dems have also matched Conservative party promises to compensate Equitable Life policy holders who suffered financial loss.
The Lib Dems have pledged to scrap income tax on the first £10,000 earned, which they say will give £700 back to millions on low to middle incomes and free 3.6m more people from paying any income tax at all.
The party says this will be paid for by giving tax relief on pensions only at the basic rate, taxing capital gains at the same rate as income and tackling tax avoidance by giving HMRC new powers to ensure properties can not avoid stamp duty if they are put into an offshore trust.
The Lib Dems will also introduce a mansion tax at 1 per cent on properties worth over £2m, to be paid on the value of the property above that level, to help fill the void.
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Readers' comments (1)
Julian Stevens | 14 Apr 2010 2:50 pm
It seems incredible (to simple fellow like me) that there should be any need even to consider the introduction of a special levy to ensure the banks repay the tax payers' money pumped into them to prevent them from going under.
Does this mean that the Treasury handed over these colossal sums of public money without imposing on the recipients any conditions for their repayment? At the very least, one would have thought there'd have been a clause saying NO MORE BONUSES until the debt is fully repaid.
It's unbelievable. And Crash Gordon wants us to vote him in for the coming five years? Not on your life, buster. I wouldn't trust Old Labour with anything to do with the economy.
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