Only Lib Dems can rescue UK - Clegg

He wrapped up his first conference as leader with a bid to exploit the turmoil surrounding Gordon Brown and present his party as the only one with firm policies to ease the effects of the credit crunch.

"We are the party with the ideas that can get Britain out of this mess," he told activists in Bournemouth who earlier this week backed his plans for tax reductions paid for by public spending cuts despite left-wing dissent.

"What Britain needs now is absolute honesty about the situation we're in and big, bold ideas to set us right. Quite simply we need a government that listens, understands, and acts. And you know what? The Liberal Democrats can be - will be - that government."

Mr Clegg set out an economic recovery plan, including the measures to lower tax bills for low and middle earners and action to avoid home repossessions and end the "free-wheeling, bonus-driven, short termism of the City".

Nine out of ten taxpayers would be better off under the party's programme, which would be the most progressive and redistributive ever proposed by a British political party, he claimed.

A 4p cut in income tax would be paid for by axing pension reliefs and tax loopholes for the super-rich and increased green taxes while further reductions would come out of £20 billion on Whitehall savings.

"The other parties say tax cuts aren't possible. But that's because they're too flaky to take the tough choices. Too weak to trim back on wasteful spending. Too in hock to wealthy non-doms to threaten higher taxes for the rich."

Ministers offered no solutions to the worsening situation because they were too busy fighting among themselves over the Labour leadership like a bunch of "zombies", he said, as more Labour dissenters broke cover.

"They're so desperate to protect their own jobs, they can't be bothered to protect other people's. They are the living dead - no heart, no mind, no soul - stumbling around with no idea what to do. All these backbenchers and ex-ministers you've never heard of, rising up from the grave of obscurity to impale their Gordon Brown."