Lib Dems urge voters to ‘take a chance’ on tax hikes to fund health and care

The Liberal Democrats set out a goal of taking the UK back into the European Union single market and hiking taxes by almost £27 billion to fund major investments in health, social care and public services.

Sir Ed Davey put a £9.4 billion-a-year package for the NHS and social care at the heart of his party’s General Election manifesto, funded by a tax raid on banks and the super-rich.

And the manifesto also committed to seek to reverse one of the major Brexit decisions by placing the “UK-EU relationship on a more formal and stable footing” by rejoining the single market – something that would result in the return of free movement.

Sir Ed Davey launching the Liberal Democrats' General Election manifesto in London
Sir Ed outlined the key points in London (Lucy North/PA)

The party plans to fund its promises with a series of tax rises which amount to £26.7 billion in 2028-29, including:

– “Reversing Tory tax cuts” for banks, restoring bank surcharge and bank levy revenues to 2016 levels in real terms.

– Increasing the Digital Services Tax on social media firms and other tech giants from 2% to 6%.

– Reforming capital gains tax – paid on profits from selling an asset – to “close loopholes exploited by the super-wealthy”.

– Introducing a 4% tax on the share buyback schemes of FTSE-100 listed companies, to incentivise investment, job creation and economic growth.

– A “proper” windfall tax on oil and gas giants.

– A “super tax” on private jet travel and the removal of VAT exemptions for private, first-class and business-class flight.

As an Abba classic played at the manifesto launch in London, Sir Ed urged voters to “Take A Chance” on him.

The manifesto features a “four-stage roadmap” for the UK’s relationship with its European neighbours.

“Once ties of trust and friendship have been renewed and the damage the Conservatives have caused to trade between the UK and EU has begun to be repaired, we would aim to place the UK-EU relationship on a more formal and stable footing by seeking to join the single market,” the manifesto reads.

This process would begin with “initial unilateral steps to rebuild the relationship, starting by declaring a fundamental change in the UK’s approach and improving channels for foreign policy co-operation”.

But at the core of the Lib Dems’ pitch to voters is the package of health and care pledges.

Sir Ed, himself a carer for his 16-year-old son John, launched his manifesto by telling audiences about his own experience.

He said: “The truth is, unless we properly value care, unless we properly support carers, we will never be able to fix the crisis in our NHS or get our economy back on track.

“And that’s why I’m so proud the Liberal Democrats have put health and care at the heart of our campaign in this General Election, and at the heart of our manifesto too.”

The party would recruit or retain 8,000 extra GPs to give a right to be seen by a doctor within seven days.

Sir Ed Davey plays adventure golf in Wokingham, Berkshire, with a big dinosaur to his left (right of picture)
Liberal Democrat leader Sir Ed Davey made headlines with his campaign trail stunts before he turned his focus to manifesto policies this week (Will Durrant/PA)

The Liberal Democrats also want to guarantee access to NHS dentistry for those in need of urgent care, and they promised to implement the recommendations of the UK Infected Blood Inquiry in full, including “full and fair compensation to all victims of the scandal in a timely and transparent manner”.

The Nuffield Trust health think tank questioned the costings of the health and care pledges, saying: “The real sting in the tail of this manifesto is that the sums to support these worthwhile aspirations simply don’t add up.”

Other pledges in the manifesto include ending the sewage crisis by turning water firms into public-benefit companies and banning bonuses for bosses until discharges and leaks have been eliminated.

Ofwat would be replaced with a tough new regulator with powers to prevent sewage dumps under the party’s plans.

The party promised to help with the cost-of-living through an £8.4 billion home energy upgrade programme, a national food strategy and “careful economic management” to get mortgage interest rates under control.

The Lib Dems promised to maintain the triple lock on the state pension, in a similar move to Labour and the Conservatives, and also pledged to ensure women born in the 1950s who have been affected by pension age changes are “treated fairly and properly compensated”.

To build 380,000 new homes a year across the UK, including 150,000 social homes a year, the Liberal Democrats would back 10 new garden cities. The Labour Party before the election outlined its pledge to build New Towns.

On political reform, Sir Ed told the launch his party would end the first-past-the-post voting system in favour of “fair votes with proportional representation”.

Liberal Democrats leader Sir Ed Davey sat on a teacup ride during a visit to Thorpe Park in Chertsey, Surrey, whilst on the General Election campaign trail
Liberal Democrats leader Sir Ed Davey during a visit to Thorpe Park in Chertsey, Surrey, whilst on the General Election campaign trail (Lucy North/PA)

He said this would also involve “getting big money out of politics with a cap on donations to political parties, shifting power out of the centre”.

The Institute for Fiscal Studies think tank said there were “clear risks” that the Liberal Democrats’ tax plans would not raise the £27 billion that they hope.

IFS director Paul Johnson said: “By focusing on taxing banks, energy companies and tech giants, many of these tax rises are intended to look ‘victimless’ – but of course they are not.

“We are already raising more from taxing companies than at any time in decades. Moreover, there are clear risks that their package of tax measures would not raise the £27 billion a year that they claim.

“And some of the tax raising measures are an economically bad idea. We should not, for example, be taxing share buybacks.”

The Lib Dems have focused their campaigning efforts in the so-called blue wall of Tory-held seats.

But Conservative Party chairman Richard Holden said: “A vote for the Liberal Democrats is a vote to put Sir Keir Starmer in Downing Street.”