Pre-Budget 2008: Cable unimpressed with “fig leaf” policies

Liberal Democrat Vince Cable adopted an alternative criticism of the Pre-Budget Report, accusing Alistair Darling of not going far enough.

The chancellor announced a £20 billion fiscal stimulus which will double the national debt, cut value-added tax for the first time since before 1997 and increased income tax to 45 per cent for those earning over £150,000.

Treasury spokesperson Vince Cable said the government had not provided the “boost” needed by the economy through the 13-month VAT reduction from 17.5 per cent to 15 per cent.

“What I fail to see is how the economy gets a major stimulus. from a £5 cut in a £220 multiplex screen television or a 50p cut in a £25 restaurant bill,” he said.

“Surely it would be much more sensible to put money directly in the pockets of. people by cutting their income tax.”

Mr Cable said the government had finally acknowledged a “problem of inequality” in the tax system but attacked the “fig leaf for redistributive policy” presented by Mr Darling today.

“The government has the rhetoric, but the rhetoric is not matched by the action,” he added.