Davis launches leadership bid with pledge on low tax

Published on 08/09/2005 00:28

DAVID Davis returns today to the centre-stage of the Conservative leadership race, making an excoriating attack on Gordon Brown and staking his claim as the candidate of lower taxes.

After watching from the sidelines as Kenneth Clarke and David Cameron made their pitches, the shadow home secretary has broken his silence with an article in The Scotsman today on economic policy.

Liam Fox, his rival for the vote of the Tory right wing, is also planning a low-key launch today. Both men are expected to say the party should spend more time attacking Labour.

In his article, Mr Davis, the bookmakers' favourite in the forthcoming leadership race, lays out what he calls the "seven deadly sins" which Mr Brown has made as Chancellor.

He leaves no doubt that, unlike other leadership candidates, he is firmly committed to reducing taxes. "Only a low-tax, light-regulation economy can provide the resources for good healthcare and education, roads and police because those are the economies that generate sustainable wealth," he writes.

"Only a low-tax, light regulation economy can build the stronger society we all want to see because those are the economies that encourage enterprise, provide incentives and promote competition."

George Osborne, the shadow chancellor who is backing his friend David Cameron for the leadership, made the opposite argument yesterday. "We have offered tax cuts at the last three elections and lost each one of them," he told the Social Market Foundation. "More striking, our tax-cutting manifestos have not helped us gain a reputation for economic competence or even won us the trust of the public on tax issues."

The Tories, however, fought the May general election on a plan to raise the tax burden - something which riled Mr Fox and Mr Davis, who are both expected to say that tax-cutting is the fundamental mission of conservatism.

In his article, Mr Davis says raising taxes is the core mistake made by Mr Brown, and suggests the Chancellor's overspending has weighed down the British economy.

He makes clear he has none of the grudging admiration for the Chancellor exhibited by Oliver Letwin, who was shadow chancellor in the run-up to the general election.

Mr David blames Mr Brown for Britain's "worst period of economic growth since 1993" - referring to the most recent annual growth figures - and chides him for borrowing more this year than Scotland's entire economic output.

The Chancellor's talents, he says, lie in stealth taxes. "In the words of the Scottish economist Adam Smith, Gordon Brown has learnt the 'art' of 'draining money from the pockets of the people'."

He lists Mr Brown's seven sins: big spending, tax rises, big government, impeding public sector reform, high regulations, growing welfarism and - overall - taking Britain on the wrong economic course.

"His disastrous decision in his first Budget to grab 5 billion every year from Britain's pension funds, undermining our pension industry and stock market performance as a result, should have warned us of the direction of his travel," he says.

Mr Fox, meanwhile, has taken the bold step of choosing a mental health care centre as the backdrop for his campaign launch - risking obvious jibes from his rivals. However, better treatment of the mentally ill has been one of his main campaign themes.

Mr Fox will also name two more MP supporters, taking his public total to ten. His aides say they have at least 30 MPs who have not yet declared, while Mr Davis is understood to have the backing of 38 MPs, with a dozen supporting Mr Cameron, 11 backing Mr Clarke and five on the side of Sir Malcolm Rifkind.

But it looks increasingly likely that the 300,000 rank-and-file Tories will veto a proposed change to the leadership election rules. This would trigger a new campaign, with all members voting, not just the MPs . This could drag the leadership race on until next January.