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Lib Dem conference: Huhne hits out at Tory ‘slavering’ over tax cuts

Energy secretary says anti-European and tax cut policies would endanger coalition attempts to lead UK out of recession

The energy secretary, Chris Huhne, has warned that Tory “slavering” over tax cuts and Europe threatens the coalition’s efforts to lead Britain out of recession.

In a speech to the Liberal Democrat conference, he said: “This coalition government saved Britain’s credit standing by compromise. The danger if you don’t compromise is now clear from America. There, the markets looked over the brink when the madcap Republican right in Congress would not compromise with the president. Let that be a warning to the Conservative right here – we need no Tea Party tendency in Britain.

“If you fail to compromise, if you fail to seek the common ground that unites us, if you insist that only you have the answers, if you keep beating the anti-European drum, if you slaver over tax cuts for the rich, then you will put in peril the most crucial achievement of this government. You will wreck the nation’s economy and common purpose. We are all in this together and we can’t get out of it alone.”

Huhne, a strong pro-European, made a staunch defence of the need for international co-operation and launched a fierce attack on Conservative Eurosceptics.

He said: “The European Union is also key to our prosperity. Being part of Europe is not a political choice. It is a geographical reality. It always was and, until the tectonic plates break up, it always will be. We will not, as Liberal Democrats in government, weaken the ties that deliver our national interest through the EU.”

He again condemned the vilification of the Liberal Democrat leader and deputy prime minister, Nick Clegg, during the AV referendum campaign and said he did not regard compromise as a dirty word.

The bulk of Huhne’s speech was taken up by an argument that climate change policies are not a luxury that can be ditched at a time of austerity. He also claimed that energy consumers would be better off by 2020 as a result of his policies to decarbonise the economy. Pressure groups and Conservatives have been increasing calls to dilute the green programme, saying it is not feasible in a recession.

Huhne admitted his policies – including a carbon price and green investment bank – were under challenge, saying: “If you are facing a pay squeeze – or even worse a lost job – if your pay packet no longer buys what you need, people understandably put other priorities higher up the scale. As always during hard times, every other issue pales into insignificance besides the big issues of earning your living.”

But he added that “cutting carbon is not a luxury to be ditched when the going gets tough”, saying it was integral to taking Britain out of the deepest recession since 1929. Huhne claimed the green deal could create 250,000 jobs, and two-thirds of energy would come from renewable sources by 2030, describing the change as the “new green industrial revolution”.

He said: “In the 30s, we did not create new jobs by bringing back the textiles, coal and iron jobs that were lost. We created new jobs in new industries, and the same is happening today. Every month, more than 300,000 people leave the unemployment register to find new jobs. Thousands of those jobs are now in the low carbon economy. It is our route to recovery. Green business is good business.”

He added: “The real risk is not doing too much. It is doing too little and getting left behind. Other people argue that we cannot afford to boost the low carbon economy. It would be cheaper, they say, to rely only on oil and gas. To say it is to laugh at it. World gas, and hence electricity, prices have leapt by a third thanks to Libya and far eastern growth. In the storm-tossed seas we have to sail, low carbon energy gives us security.”

Huhne set out a package of reforms designed to help consumers and aimed at requiring the big six energy companies to be sensitive to the needs of their customers, including providing simpler tariffs and clearer advice on how consumers can shop around.

He set out a series of measures designed to give Ofgem, the energy regulator, stronger powers to stop predatory pricing.

“It’s not fair that big energy companies can push their prices up for the vast majority of their consumers, who do not switch, while introducing cut-throat offers for new customers that stop small firms entering the market,” he said.

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