Philip Hammond delivered a stark warning today that Labour’s brand of ‘Marxism’ would take Britain back to the 1970s.
The Chancellor urged the Tories to fight for free markets as he said the last time a socialist government was in power tax rates rose to up to 98 per cent.
Describing Jeremy Corbyn as a ‘clear and present danger’ to the economy, Mr Hammond vowed: ‘We will take them on and we will defeat them.’
The rallying cry came as Mr Hammond delivered his keynote speech to the Conservative conference in Manchester.
The Chancellor urged the Tories to fight for free markets as he said the last time a socialist government was in power tax rates rose to up to 98 per cent
Mr Hammond delivered his keynote speech to the Conservative Party conference in Manchester today
Mrs May was in the audience at the Conservative conference in Manchester today to hear speeches by her team including Chancellor Philip Hammond
In a round of interviews ahead of his conference speech later, Mr Hammond (pictured in Manchester today with the PM) affirmed his ‘100% support’ for Theresa May
But so far the gathering has been overshadowed fresh leadership manoeuvring by the Foreign Secretary threatened to overshadow the party’s conference in Manchester.
MPs demanded Mr Johnson ‘grow up or go’ after he drew a series of red lines for Brexit negotiations and laid out demands on domestic policy.
In a sign of her weakness in the wake of the disastrous election campaign, Mrs May dodged questions yesterday about whether her Foreign Secretary was ‘unsackable’.
But Cabinet ministers have rallied round, and crucially, the powerful Tory 1922 committee is still thought to be behind her.
Despite his high-profile interventions, Mr Johnson tried to play down the spat today saying he was just repeating government policy and did not know what all the ‘fuss’ was about.
But Mr Hammond delivered a rebuke to his colleagues by warning that nobody is ‘unsackable’.
Laying out the economic case for a Tory government today, Mr Hammond said under Labour in the 1970s there were tax rates of 83 per cent on earnings and 98 per cent on interest and dividends.
He said the country effectively collapsed at the end of the decade with the ‘winter of discontent’ of strikes and unrest – before the Thatcher government came in and pushed through reforms.
Mr Hammond said it was no good ‘droning on’ about the way those arguments were won.
But he said lessons must be learned from history, and jibed that he would not trust shadow chancellor John McDonnell with a ‘Monopoly set’.
He said Mr McDonnell had gleefully welcomed the credit crunch and urged his hard-left allies to take advantage of it.
‘It’s a wicked and cynical business offering superficially simple solutions to complex challenges,’ Mr Hammond said.
‘But colleagues, we need to listen to those fears and concerns, we need to acknowledge the weariness at the long slog back from Labour’s recession, the pressure on living standards caused by slow wage growth and a spike in inflation.
‘The frustration among the young who fear that the combination of student debt and sky high rents and house prices will condemn them never to access the opportunities of property ownership their parents enjoyed.’
He said the arguments about free markets had been won so decisively in the past that ‘Corbyn and McDonnell were for years treated almost as museum pieces dinosaurs, worth preserving for the sake of historical curiosity’.
‘But last week at Brighton the dinosaurs had broken out of their glass cases, their political DNA apparently uncontaminated by any contact with the reality of thirty years of global economic development ready to wreak havoc fighting the battles of the past using the language of the past, all over again, a sort of political version of Jurassic Park,’ Mr Hammond said.
Mr Hammond said he was not claiming the market economy was ‘perfect’, but it was the best way of creating wealth for all society.
‘Our economy is not broken. It is fundamentally strong,’ he said.
In a round of interviews ahead of his conference speech, Mr Hammond affirmed his ‘100 per cent support’ for Mrs May if she wants to stand at the next election.
Mr Hammond repeatedly refused to give such a commitment when pressed by journalists last week.
Asked whether Mr Johnson should be sacked, the Chancellor told ITV’s Good Morning Britain: ‘We all serve at the Prime Minister’s pleasure and we all owe the Prime Minister our allegiance and our loyalty within the Cabinet.
‘I have always operated on the principle that it is probably best to believe that nobody is unsackable. Everybody has got to pull their weight within the Government.’
A series of Cabinet ministers delivered thinly-veiled rebukes in public. Damian Green, Mrs May’s effective deputy, said concerns about policy should be voiced ‘privately’ within government.
Scottish Secretary David Mundell mocked Mr Johnson’s chances of winning the top job, saying:’I do recall that Boris Johnson once stood as rector of Edinburgh university. You can look at the results of that.’
In 2006 Mr Johnson came a distant third when he stood for that role, having been greeted by students with chants of ‘Bog off Boris, you top-up Tory’.
Mrs May refused to answer a question about whether Mr Johnson, pictured running in Manchester today, was ‘unsackable’
Keeping up with Mr Johnson is not just a struggle for the Conservatives, with one of the minister’s close protection police officers taking a stumble following him this morning
Scottish Tory leader Ruth Davidson was in the conference hall to hear the speeches today
The PM and Mr Hammond left the Midland Hotel in Manchester, the centre of the conference, together this morning
Ruth Davidson, the party’s leader in Scotland, and often tipped as a future PM, also complained at the Tory ‘psychodrama’ being played out in the media.
Former education secretary Nicky Morgan said last night that Mr Johnson ‘had to go’ unless he could show his loyalty to the Government.
The British Chambers of Commerce has warned that public disagreements between Government ministers were damaging business confidence.
But Mr Johnson said: ‘I think actually if you studied what I said, it was basically government policy. I think it’s extraordinary that so much fuss has been made about repeating government policy, but there you go.’
Mr Hammond acknowledged that uncertainty over EU withdrawal negotiations were causing ‘a pause in business investment’ which was harming the UK economy, and said it was the duty of all Cabinet ministers to ‘pull their weight’ in support of the Prime Minister.
The Chancellor’s intervention came as he tried to keep attention on the domestic agenda, with the announcement of £400 million for transport links in the North of England.
Some £300 million will be used to ensure cities like Liverpool, Manchester, Sheffield, Leeds, York and Leicester can be linked up with the HS2 high-speed rail route between London and the North.
And a further £100 million will go into local road schemes to cut congestion and unlock new sites for homes and businesses in the North.
Mr Hammond has also unveiled a £10billion for the Help to Buy scheme, which guarantees deposits for would-be home owners who do not have enough capital.
On a visit to a new housing estate in Manchester this morning, the Prime Minster and Mr Hammond met a young couple who have just bought a starter home using the Government’s scheme.
But during the visit to Walkden, Salford, Mrs May revealed the other Philip in her life is no handyman.
Rebecca Coulton said she had turned to help from her ‘handy’ dad when jobs needing doing, although her partner Chris Leyland had helped to build a table.
Mrs May joked: ‘I didn’t choose a DIY specialist either, I can tell you.’
The Chancellor, meanwhile, urged the couple to ‘tell all your friends, £10 billion into the scheme’ as they chatted over a cup of tea.
Ms Coulton said: ‘I can’t recommend it enough.’
Senior figures are prepared to back Mrs May, pictured in Manchester with husband Philip today, should she decide Mr Johnson has to be sacked
MINISTER SAYS TORIES FACE CRISIS AS MEMBERS AGE AND DIE AS CABINET SPEAK IN EMPTY HALL
The Conservative Party is wasting away as its members age and die, a minister admitted today as senior MPs addressed a sparsely filled conference.
Philip Lee said ‘natural wastage’ was the biggest crisis facing the Conservatives and warned in a decade the party would be in a ‘losing position’.
The junior justice minister made his admission on the conference fringe as a string of Cabinet ministers addressed a near empty hall in Manchester.
Cabinet minsters addressed a near empty conference hall in Manchester today as only scores of activists turned out in the hall
Scotland Secretary David Mundell and Wales Secretary Alun Cairns addressed ranks of empty seats in the main speeches.
The sight was in stark contrast to last week’s Labour’s conference in Brighton which was packed out for virtually every minute of every day.
At the Social Market Foundation/Opinium fringe meeting this morning, Mr Lee said: ‘I do think it is hugely important, in fact I’d say this issue [appealing to younger voters], the challenge the Conservative party faces, is the challenge, actually.
‘Nick Clegg made some headlines recently for saying basically that Brexit wouldn’t have happened because of natural wastage now.
‘Rather unpalatable, but I wonder actually, in ten years’ time, because of natural wastage, whether we’re going to be in a similar losing position.’