Lib Dem grassroots plot yet another Bedroom Tax revolt

90 Lib Dem general election candidates and activists call for controversial tax to end for existing social housing tenants

Nick Clegg is interviewed by children’s newspaper ‘First News’ as part of the Sky News Stand Up Be Counted campaign, on Wednesday (PA)

Nick Clegg is facing a revolt from grassroots Liberal Democrats who will demand a firm pledge to scrap the bedroom tax at the party’s spring conference starting on Friday.

In a letter to The Independent, 90 Lib Dem general election candidates and activists call for the bedroom tax to be ended for existing social housing tenants, who have seen their housing benefit cut if they have a spare room. They want the party manifesto to go further than Mr Clegg’s promise to exempt claimants when there is no smaller property available in their area.

The activists welcome the reforms pledged by the Deputy Prime Minister, but say: “We are also pleased to support revoking the under occupancy charge, so it will only apply to new tenancies going forward.”

Kelly-Marie Blundell, Lib Dem candidate in Guildford, who organised the letter, said the manifesto should also protect benefits for disabled people by excluding them from the 1 per cent cap on working age benefit rises proposed by the Conservatives.

In another challenge to the Lib Dem leadership, some activists want to see the party to commit to more tax rises and fewer spending cuts in the 2015-20 parliament. They want to see 50 per cent of the deficit cleared by tax increases and 50 per cent through spending reductions. The leadership wants 60 per cent to come from cuts and 40 per cent from higher taxes.

Nick Clegg is interviewed by children’s newspaper ‘First News’ as part of the Sky News Stand Up Be Counted campaign, on Wednesday (PA)

Ms Blundell said: “By ensuring that there is a balance between tax rises and cuts, we can make sure the recovery stays on track, but is fairer and doesn't affect the working age poor.” She hoped the manifesto would include “a clear reference to cuts and tax rises being balanced, and if at all possible 50:50, to protect the most vulnerable."

Mr Clegg has already given some ground by moving from the ratio in this parliament, which saw 80 per cent of deficit-reduction coming from cuts and 20 per cent from higher taxes. This was seen as a victory for Vince Cable, the Business Secretary, over Danny Alexander, the hawkish Chief Treasury Secretary.

The leadership hopes to head off a defeat at the Liverpool conference by reaching a compromise with party members. Mark Pack, an activist who initially proposed a 50:50 split, said that he supported an alternative policy that could unite most of the party - to rule out benefit cuts after the first two years of the next parliament. “This should both achieve most of what those wanting 50:50 are after, but also be accepted by those in the party more hawkish on cutting spending,” he said. He believed the party would end up with a policy somewhere between a 60:40 and 50:50 split.

The Lib Dems’ stance on cuts and tax rises could be important in negotiations with the Tories or Labour if there is another hung parliament after the May election. The Tories have ruled out any tax rises, but Labour would clear part of the deficit from higher taxes.

A Lib Dem spokesman said: “We have already taken important steps to reform the spare room subsidy [bedroom tax] to ensure we protect the most vulnerable, and our manifesto will further reinforce our position. We believe the rules should be changed so tenants aren’t penalised when they cannot move into smaller accommodation because it is not available, or where there is a serious medical reason to have an additional room.”

On the deficit, the spokesman said: “Nick Clegg and Danny Alexander have outlined how the Lib Dems will finish the job of balancing the books by 2017-18 through a mix of tax rises and spending cuts, ensuring that we finish the job fairly. Finishing the job of balancing the books while protecting vital public services will require increasing taxes on the very wealthiest and ensuring big business pay their fair share. We are confident this position is one the party will united around at conference.”