This conference season represents the halfway point for the Coalition Government. It’s a milestone not everyone believed we would make. Two and a half years ago a hung parliament was presented, by some, as an electoral equivalent to the sky falling in. Plural politics – unknown in this country for so long – was met in certain quarters with deep scepticism. Coalition would inevitably prove divided and weak – or so the prediction went.
Yet the pessimists have been confounded. Certainly coalition can, at times, be a rocky business – we are different parties with different priorities; of course we will sometimes clash. But, generally, those moments are met with a more professional attitude than has been found in factionalised governments of the past. Coalitions tend to function more like business partnerships and less like dysfunctional families. And this Coalition has provided the UK with the strong and decisive government needed to steer the economy out of extremely difficult times.
At my party’s conference, I will be encouraging Liberal Democrats to be proud of the role we are playing. We are proving ourselves to be a mature and capable party of government: able to take difficult decisions and clear on the values we hold.
And nowhere are those values clearer than in our approach to tax – the central theme this year in Brighton, where our slogan is “fairer tax in tough times.” Liberals believe in a tax system that rewards work rather than wealth. And, when times are tough, it is even more important that people pay their fair share and that those with the broadest shoulders bear the biggest burden.
That was not the case when we came into government. People on low paid jobs paid too much. Those at the top paid too little. So we have delivered one of the most radical, redistributive changes to the tax system of modern times.
Every year we have raised the rate at which you start paying tax, lifting the lowest paid out of paying Income Tax altogether and delivering a tax cut for over 20 million working people. That change has travelled straight from the front page of our manifesto to the pages of the Coalition Agreement and every subsequent Budget and into people’s pockets. The biggest increase comes into effect next April, by which point we will have lifted two million of the lowest paid workers out of tax and cut people’s taxes by £550 a year.
And we’re not finished yet – the Coalition Agreement commits to no one paying tax on the first £10,000 they earn. In the longer term, it is our party policy that no one should pay tax until they are earning above the minimum wage.
At the same time, we’ve clamped down on those who pay too little. We’re targeting an extra £7bn a year from tax avoiders; increasing Capital Gains Tax to bring it more into line with income tax; and we are taxing the banks an extra £2.5bn every year.
It’s not just tax where we are making a real difference to people’s lives. We are investing more than ever before in early years education and giving schools more money, through the Pupil Premium, to help the most disadvantaged catch up in class. We are leading an apprenticeship revolution and helping young people get work or training through the £1 billion Youth Contract. And we are making Britain greener with tough environmental targets, radical energy efficiency plans and investing in green jobs.
Liberal Democrats have proved the doubters wrong throughout our history and we will continue to do so. And as we do we will continue to deliver radical liberal reforms, all the way through to 2015 and beyond.
Nick Clegg is leader of the Liberal Democrats