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Clegg defends spending cuts

Nick Clegg has used his conference speech to settle nerves over the coalition and the spending review.

Speaking to a packed conference hall at the Liberal Democrats party conference at the Echo Arena in Liverpool this afternoon, Clegg said he stands by the coalition agenda and that the spending review was about balance and responsibility, not slash and burn.

He said: “Our parties, despite so many cynical predictions, are not simply settling for the lowest common denominator between us. We have become more than the sum of our parts. Two heads are better than one.

“Some say we should not have gone into Government at a time when spending had to be cut, we should have let the Conservatives take the blame. Imagine if we had turned away, however could we have asked voters to take us seriously?

“You do not get to choose the moment when the opportunity to shape your country comes your way.”

Clegg denied the cuts were a backdoor attempt to dismantle the State and said the Government would be spending 41 per cent of the UK’s national interest this year, the same amount spent in 2006. He also assured delegates that the Government would, by the next election, make sure debt as a proportion of national income will be falling.

Clegg said: “It is not an ideological cut on the size of the State. There is one reason and one reason only for the cuts: as Liam Byrne said in that famous letter, there isn’t any money left.”

Seeking to counter some of the friction at the Liverpool gathering over cuts to the public sector in the wake of the banking crisis, the deputy Prime Minister outlined some of the moves taken by Government aimed at dealing with the causes and the effects of the crisis.

He said: “It’s why we imposed a banking levy in our first Budget, it is why we are working with our friends in Europe and beyond on an idea of a finance activities act on profit, pay and bonus. It is why we are going to be forcing the banks to own up about the ludicrous pay and bonuses they give out. It is why our banking commission is looking at whether to split up the banks completely to keep our economy safe.”

Clegg said the banking levy will have brought in £10bn and that banks will be lending responsibly again by the next election in 2015.

In a move that will please business interest who have lobbied for the protection of infrastructure spending, he said capital spending will not “be swept away”.

He said: “Britain is anxious and unsure about the future but Britain in 2015 will be a different country. Stick with us and together we will change Britain for good.”

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