Cable rejects call from Lib Dems to rethink VAT plans

Vince Cable is set to brush off demands from restive Liberal Democrats for a rethink on the Government's plans to increase VAT to 20 per cent.

Backbenchers will challenge the tax-raising move in a Commons debate on the Budget today, but the Business Secretary insisted yesterday that there was no chance of its measures being altered.

Fresh evidence of tensions within Liberal Democrat ranks over the austerity package emerged as opinion polls suggested public support for the party was dropping.

The MPs, mirroring the concerns of party activists hostile to the alliance with the Tories, demand an assessment on the impact on the VAT increase on businesses, charities and households. Andrew George, the MP for St Ives, said: "I am not trying to trigger nuclear war and break up the coalition, it's perfectly normal for two parties to have different approaches and values. I just want to express my unhappiness with the move and have an open debate."

Simon Hughes, the Lib Dem deputy leader, has suggested that MPs could attempt to alter elements of the Budget when it faces scrutiny in the Commons.

But asked if parts could be amended, Mr Cable replied: "No, we've got a balanced package as it is, and we are not reopening it."