Lib Dems: Tax wealth to create £100bn ‘citizen’s fund’

A £100bn “citizens fund” should be created to spread the UK’s wealth more evenly, the Liberal Democrat leader Sir Vince Cable is proposing.

He will tell the party’s conference it could be built up through taxes on the richest and the sale of assets, such as the UK stake in Royal Bank of Scotland.

Sir Vince will say it is a “disgrace” taxpayers are yet to be repaid for the RBS bail-out in the financial crisis. 

A sovereign wealth fund would bolster public finances, he will add.

The Lib Dem leader – who famously predicted the 2008 financial crash – warned about “dangerously high” levels of debt in the UK economy.

A wealth fund would, he hopes, allow the UK to benefit from returns on investments typically only available to the wealthy and protect the UK from future economic crises. 

Explaining the policy on the BBC’s Andrew Marr Show, he said he wanted to scrap inheritance tax and replace it with “a tax on people’s gifts through their lifetime”.

Such a move was needed, he said, because “the inequalities of wealth are massive and growing and one of the major sources of underlying dissatisfaction”.

Asked about comments by former Lib Dem leader Lord Campbell, who said Sir Vince “can see the end of the road”, he said: “I’m not running out of road, there’s a lot of road ahead.”

Sir Vince has previously said he would stay on until Brexit was “resolved or stopped” but would be gone before the next general election in 2022.

Asked if he would still be party leader by the end of next year, Sir Vince said: “I think that’s uncertain. I have a series of tasks to do. I’m going to do them. 

“I’m not setting a time horizon. I think it would be foolish to do so with so much uncertainty flying around.”

Sir Vince said the Lib Dems were talking to disillusioned Labour and Tory MPs, who he claimed were ready to quit their parties over Brexit. But he said setting up a new centre party was “not a practical proposition” and “not going to happen”.