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Last Updated: Friday, 23 December 2005, 14:41 GMT
Tories back wealth redistribution
Oliver Letwin
Mr Letwin is overseeing a policy review
The Conservatives should try to narrow the gap between rich and poor, the party's new policy chief has said.

In an interview with the Daily Telegraph, Oliver Letwin said a future Conservative government should make wealth redistribution its goal.

New Tory leader David Cameron has put Mr Letwin in charge of an 18-month overhaul of party policy.

Labour said the Conservatives lacked credibility on poverty and had opposed moves to reduce it.

'Enlarging cake'

Mr Letwin is in charge of six policy review groups, including a social justice team chaired by Iain Duncan Smith.

We have gone as far as we possibly can with the redistribution of income
Margaret Thatcher in 1975

In his Telegraph interview, the Dorset West MP and former shadow chancellor said: "Of course it should be an aim to narrow the gap between rich and poor.

"We do redistribute money and we should redistribute money. But we have to find ways that empower people rather than reduce them to dependency."

The Tory policy director said it was clear that a section of British society was unable to participate in things that the rest take for granted, and one reason for this was lack of money.

Mr Letwin told BBC Radio 4's The World at One that tax increases for the wealthy were not the only way to address inequality and he wanted a way of "empowering people at the bottom of the heap to have a larger share of an enlarging cake".

He said talking about redistribution was also way to "get into people's minds that we are a party that's changing".

But he conceded the party would not be taken seriously on the issue until it came up with some policies, and he said these could not be "invented overnight".

Social justice

Mr Letwin's words will be seen as a break with traditional Conservative policy, which has focused on wealth generation rather than redistribution.

In a 1975 speech, shortly after she became Tory leader, Margaret Thatcher said: "We have gone as far as we possibly can with the redistribution of income. We really now must concentrate on creating more growth so that the size of the cake is bigger."

Although wealth redistribution was a founding principle of the Labour Party, Prime Minister Tony Blair has always shied away from talking about it, preferring to talk instead about equality of opportunity.

He last mentioned redistribution in a speech in 2002, when he said he wanted a "Britain in which we continue to redistribute wealth and opportunity to the many, not the few".

Earlier this year, Northern Ireland Secretary Peter Hain said Labour should focus more on social justice.

"We've got to be much clearer that we really are committed to social justice, we really are committed to redistribution of wealth and income, that we really are trying to narrow the gap between those at the top and those at the bottom," he told BBC Two's Newsnight.

But Mr Hain's suggestion that higher earners should pay more tax was slapped down by Mr Blair.


The Lib Dems have been more willing to talk about redistribution but have dropped their pledge to increase taxation.

Launching their own review of tax policy earlier this year, the Lib Dems said they wanted to strike a balance between "redistribution and preserving economic incentives".

Commenting on Mr Letwin's words, Cabinet Office Minister Jim Murphy said the Conservatives "lacked credibility" on poverty reduction.

"It is Labour that has so far taken a million children and a million pensioners out of poverty, and the Tories opposed all of the key measures and tough decisions that we took to do it," he said.

He claimed the Tories were committed to 12bn cuts from public spending, wanted to abolish the New Deal, cut tax credits and were "now proposing moves towards a flat tax that would see the millionaire pay the same tax rate as the nurse".

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