Speaking at the Commonwealth Club ahead of the Chancellor’s pre-budget report, Charles Kennedy, Leader of the Liberal Democrats, set out the party’s approach to issues of taxation and government spending. Mr. Kennedy made specific proposals to strengthen the role of the National Audit Office so that it could formally report on the economic performance of the Government.
On the Liberal Democrat approach to the economy, Mr. Kennedy said:
“The Liberal Democrats have been consistently open with the British people about tax and in the coming General Election we are making it clear our commitment is to fairer and simpler tax – not higher levels of general taxation.
“We are a party of economic liberalism. We want people to keep as much of the money they earn as possible. But we are also a party of social justice, opportunity and fairness. Without wealth creation, there is no wealth to spread. That is why our liberal tradition emphasises free trade and the opening up of both private and state monopolies to competition; allowing markets to work and freeing enterprise from the shackles of unnecessary regulation.
“But we cannot escape the fact that sustained, and sustainable, investment in our public services is central to providing quality local public services – accessible to all on the basis of need – not on the basis of how much people can afford. The British people instinctively understand this.
“Taxation has often been described as a necessary evil. I would argue differently. Moderate taxation in a liberal and democratic society can be a force for good – providing it is well spent. In a liberal society, the battle against poverty can be taken forward by ensuring that through the law and through proper sustainable investment in services for all, no one is disadvantaged by accident of birth in making the best of their talents.
“But that contract with the people – that the Government will only tax fairly and will spend their money wisely – can only be sustained if the political parties are straightforward about their plans. With the stealth tax strategy of Gordon Brown, the obvious unfairness of our current tax system – especially the Council Tax, and the empty promises of the Conservative party on this issue - it is no wonder that trust in taxation is breaking down.
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