Staking Out Middle Ground, Cameron Promises Tax Relief

In his election conference speech, David Cameron promises tax relief under the next government.

Prime Minister David Cameron speaks at a Conservative Party Conference in Cardiff, March 6, 2011
Prime Minister David Cameron speaks at a Conservative Party Conference in Cardiff, March 6, 2011 (Andrew Parsons)

In a markedly patriotic speech, Prime Minister David Cameron on Wednesday told his Conservative Party Conference in Birmingham he would use a next five years in government to build “a Britain everyone is proud to call home.”

Drawing a contrast between his and the opposition Labour Party, which is only slightly ahead in the polls for May’s general election, Cameron argued, “You never pull one person up by pulling another down. This party doesn’t do the politics of envy and class war,” he said. “We leave that to others. We believe in aspiration and helping people get on in life.”

To that end, Cameron promised to raise the income tax threshold from £10,500 to £12,500 under a next Conservative government, benefiting around thirty million working Britons.

Cameron also pledged to raise the threshold at which the 40 percent income tax rate kicks in. Currently, yearly incomes over £31,900 are taxed at 40 percent. Cameron said he would raise that to £50,000.

“With the Conservatives,” he said, “if you work hard and do the right thing, we say you should keep more of your own money to spend as you choose.”

But he conditioned tax cuts on further deficit reduction. “Tax cuts need to be paid for.” Conservatives say the cuts can only take effect toward 2018, three years into the next parliament, and will cost £7.2 billion per year by 2020. Independent analysts estimate the figure will be closer to £10 billion.

The bigger picture that emerged from the speech, wrote The Telegraph‘s Janet Daley, was one of “a social morality based on rewards for hard work, personal responsibility, pride in your achievements and true fairness.”

This was — above all — a vision speech. It was about what kind of people we want to be: a return to the idea that “doing the right thing” should never be penalized.

The Daily Mail, a conservative tabloid, was enthusiastic as well, reporting that Cameron had unveiled a “bold slate of policies” and describing his conference speech as “a straight talking pitch to low and middle earners.”

The Guardian, a left-wing newspaper, was more critical, describing Cameron’s tax promises as an “audacious bid to woo middle and lower income earners in next year’s general election.” Nicholas Watt, the paper’s chief political correspondent, argued that the speech was designed “to lay the basis of a center ground Tory pitch to the nation — and to respond to threats from Labour and UKIP.”

Former Labour Party and trade union official Dan Hodges recognized that Cameron’s promises to cut taxes amounted to a “good old-fashioned preelection bribe.” But it will work, he argued, “for the simple reason that over the past four years the Tories have earned the right to be trusted on the economy and Labour have not.”

With the deficit cut in half and close to two million more Britons in work, “all the hard work is finally paying off,” Cameron told his party members in Birmingham. And he warned voters: “go back now and we’ll lose all we’ve done.”

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