New Labour leader Ed Miliband has given his strongest signal yet that he would put up taxes in order to protect public services from spending cuts.
Mr Miliband said he would raise taxes further than former chancellor Alistair Darling had been planning in the previous Labour government to help pay off Britain’s record deficit.
Deputy leader Harriet Harman will today bring down the curtain on a tumultuous party conference, when she delivers the closing address to the delegates gathered in Manchester.
In an interview tonight with Channel 4 News, Mr Miliband reiterated his determination to “improve” Mr Darling’s deficit reduction plan which would have seen two thirds come from spending cuts and one third from taxation.
“We should look to do more from taxation. For example, taking more from banks or tackling tax avoidance,” he said.
“If we can protect ordinary families with higher taxes on banks, of course we should.
“If I was in government at the moment, I would be looking – whether it is a tax on the banks or tackling tax avoidance – to lighten the load and the cuts and the impact that it is going to have on ordinary families.
“I would do more from taxation than Alistair proposed in his plan.”
Already Labour’s plans contrast with the coalition Government’s aim to cut 80% of the deficit through spending cuts and 20% through higher taxes.
The Conservatives claimed that Mr Miliband would have to raise taxes by a further £35bn (€40bn) – the equivalent of 7p on the basic rate of income tax – in order to meet the commitments he made during his leadership campaign.
Tory MP Matthew Hancock said that Mr Miliband needed to spell out how he would find the money.
“Ed Miliband said he would set out how he would deal with the deficit by the time of the spending review, but it’s increasingly clear he has no plan,” he said.
“When Ed Miliband says he wants to target the squeezed middle, it’s now clear he wants to target them with swingeing new taxes. It may woo the Labour faithful but not the hard pressed British public.”
Ms Harman’s speech – traditionally a light-hearted affair – will bring to a close a momentous conference at which Labour has crowned a new leader but lost one of its biggest talents from the shadow cabinet.
Former foreign secretary David Miliband announced last night that he was quitting the frontbench after being defeated by his younger brother in the battle for the Labour leadership.
He said he was returning to the backbenches to avoid becoming a “distraction”, adding that it would also allow him to “recharge my political and intellectual batteries” and spend more time with his family.
He would remain MP for South Shields and devote himself to developing the network of community organisers he set up as part of his leadership campaign. He stressed that he was not ruling out a return to the front bench and Ed promised to keep the door open for him.
In a letter to the chairman of his constituency party, he said he was confident that stepping back from the frontline was “the right decision for Ed, for the party and for me and the family”.
Ed described him as “a massive talent”, admitting: “We would have been a stronger team with him in it, but I think he is right to have made the decision he did.”
Allies of David Miliband, who left Labour’s Manchester conference early to return to his London home, praised his decision to quit the frontbenches.
But Conservative Party chairman Baroness Warsi claimed that it spoke of political differences with his brother and “the direction in which the new leader is taking Labour”.
“After being elected by the unions, this is further evidence that Ed Miliband is vacating the centre ground of British politics,” she said.
David’s departure from Labour’s top team came as the deadline passed for nominations to the shadow cabinet. Ballots will be distributed among MPs from today.
Some 49 Labour MPs – ranging from former cabinet ministers like Alan Johnson, Ed Balls and Peter Hain to relatively unknown backbenchers – are standing for 19 elected positions in a ballot of MPs which concludes next Thursday.
As the new leader began to take control of his party, Rosie Winterton was elected unopposed as opposition chief whip after Ed Miliband asked incumbent Nick Brown – a close ally of former prime minister Gordon Brown – not to stand.