Clegg seeks backing over £20bn cuts

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Facing a potential revolt, Mr Clegg said the party was already committed to a "tax switch" from the wealthy and by taxing polluting activities to deliver a 4p cut in income tax.

The party was now seeking to identify a further £20 billion of Government expenditure which could be "spent better elsewhere" and handed back in further tax breaks to "those who really need it".

Denying he was "Cameron-lite" - as critics have dubbed him in a barbed reference to the Tory leader - Mr Clegg urged the party's conference to go "one step further" over tax policy.

Labour was wasting billions of pounds on projects his party did not agree with, such as ID cards and a massive NHS IT programme, he said.

The Liberal Democrats could identify 3% of the £600 billion bill and re-allocate some to priorities like mental health and housing and give the rest back to "those who need it most".

In a question and answer session, Mr Clegg said he wanted to help those who had been "really struggling, who have been paying more out of their income in tax than the wealthy for the last 10 or 11 years under new Labour" and now faced escalating fuel and food bills.

"It's so obvious to me that we should be on the side of those people - not simply on the side of the system in Whitehall.

"We are re-directing £20 billion of current Government spending to our spending priorities and then to tax breaks for the most vulnerable families."