Conservative leader David Cameron wants to give the Bank of England sweeping new powers to rescue failing banks.

The Tory proposals would also give the Bank a new role of monitoring both consumer and company debt.

They aim to prevent a repeat of the collapse of Northern Rock and stave off the threat to the Bradford & Bingley.

It comes on the eve of the Conservative Party conference in Birmingham where the plans will be unveiled by shadow chancellor George Osborne on Monday.

Bradford & Bingley’s share has price plummeted to a record low and on Thursday the lender announced plans to cut 370 jobs.

Avert failures

The government is already proposing similar moves to avert bank failures through Banking Reform Bill which comes before parliament next month.

BBC political correspondent Robin Chrystal said the Conservatives were likely to present their proposals as more far-reaching and on a par with Gordon Brown’s decision to give the Bank independence in 1997.

He said the Conservatives will also pledge to restore weekly rubbish collection across England. They claim the £121m can be met by axing a series of local quangoes

Meanwhile, shadow home secretary Dominic Grieve has warned British multiculturalism has left a “terrible” legacy which has allowed extremists to flourish.

He told the Guardian a type of “cultural despair” has led “long-term inhabitants” and newer arrivals to feel alienated and unsure of UK values.

Poll

It comes as an ICM poll for the Guardian suggested Labour had narrowed the gap on the Tories.

The poll put the Conservatives on 41%, Labour on 32% and the Lib Dems on 18%.

A ComRes survey for the Independent on Sunday last weekend put the Tories on 39%, Labour on 27% and the Lib Dems on 21%.

The Tory conference will open on Sunday in Birmingham, with a discussion on the economy involving shadow chancellor George Osborne and shadow foreign secretary William Hague.

Leader David Cameron’s speech closes the conference on Wednesday.

News reported by The BBC

David Cameron has attacked the government for a “completely reckless” briefing that stamp duty could be axed temporarily to boost house sales.

“Far from freeing up the housing market, they have actually frozen it,” the Conservative leader told reporters.

He is holding talks later with the National Association of Estate Agents (NAEA) – a body he claims the government has refused to meet.

It comes after Alistair Darling refused to rule out changes to stamp duty.

Estate agents have already warned that uncertainty over the government’s policy on the tax could cause people to delay buying houses.

Leak inquiry?

Speculation was fuelled by a report in last Tuesday’s Sun newspaper that the government planned to offer a holiday from stamp duty payments to revive the flagging sector.

When tackled about the story on Wednesday’s Today programme, the chancellor said a “number of measures” were being considered – but the government had come to no conclusions.

The Treasury later issued a statement saying: “Recent news stories suggesting the government has put forward a proposal on stamp duty are simply wrong. These stories are based on speculation.”

“Their decision to brief out the possibility of a stamp duty holiday was completely reckless” David Cameron Conservative leader

According to some reports, the original briefing came from Downing Street and was aimed at undermining Mr Darling – something firmly denied by Number 10.

Mr Cameron, who has returned to the political frontline, following a holiday in Cornwall, said the debacle showed the government was more interested in “press handling and headlines than what is in the best interests of the country”.

He urged the government to adopt the Conservatives’ plan to abolish stamp duty for nine out of 10 first time buyers.

“When it comes to the crisis in our housing market they seem intent on making things worse rather than better,” he said.

North East tour

“Their decision to brief out the possibility of a stamp duty holiday was completely reckless – far from freeing-up the housing market they’ve actually frozen it.

“Have they even got a leak inquiry to find out how this was briefed out? I think not. I think they know exactly where it came from.”

Mr Cameron, who will tour marginal constituencies in the North West of England before resuming his summer break with a holiday in Turkey next week, is set to meet with housing trusts, city economists, academics and house builders to discuss the property market.

The group will look at the mortgage market, repossessions and the housing supply, he said.

“We won’t be announcing any conclusions today. We won’t be briefing out thoughts today. This is a seminar to look at the issues – it’s to engage with the experts to help us develop our policies.”

‘Unacceptable’ behaviour

He refused to repeat a claim by shadow foreign secretary William Hague that the Conservatives were the “likely winners” of the next general election, stressing that there was no “complacency” in his team.

“I never use those words because the election is up to the members of the public to vote and you can’t make any presumptions about the way they are going to,” he said.

He also condemned the “completely unacceptable” behaviour of Ian Oakley, a Tory general election candidate for Watford, who admitted a campaign of harassment against his Lib Dem rivals.

The Liberal Democrats have urged him to investigate the “vile campaign” by Oakley, who quit the party following his arrest.

Oakley, 31, of Ryeland Close, West Drayton, north west London, appeared at St Albans Magistrates Court last week to admit five counts of criminal damage and two of harassment against Liberal Democrats.

He asked for 68 other offences to be taken into account. He is due to be sentenced in September.

Miliband praise

The monthly briefing comes as ex-local government minister Nick Raynsford accused Labour of being in a “deep hole” and warned that attempts to “buy” support would only invite contempt.

Writing on newstatesman.com, Mr Raynsford accused the government of a “frantic search” for vote-winning ideas.

He failed to mention Gordon Brown, but praised the call by Foreign Secretary David Miliband to “start winning the argument over our record”.

Mr Miliband fuelled speculation over the Labour leadership when he penned an article two weeks ago calling on colleagues to have the confidence to make their case afresh – but without making a reference to the prime minister once.

The prime minister, who is on holiday, is expected to launch a fightback in September.

News reported by The BBC

Conservative leader David Cameron has admitted taxes may have to rise if he becomes prime minister.

He pledged to match Labour’s spending plans if he wins power but acknowledged that a worsening economic climate could force him to raise taxes.

In a speech on economic policy earlier he also called for US-style protection laws for firms at risk of going bust.

Meanwhile, Lib Dem leader Nick Clegg says he favours a tax cutting programme for people on low and modest incomes.

‘Safeguard finances’

Asked on BBC Radio 4′s Today programme whether an incoming Tory government would have to raise taxes, Mr Cameron said: “I hope that won’t be the case because I do think we have more responsible spending plans now.

“Government always has to do what is right to safeguard the public finances.

“What we have said is we can’t over promise, we are very careful not to promise tax cuts because we knew the public finances would be difficult” George Osborne Shadow chancellor

“And as I say the tragic thing now is that, at this point in the economic cycle, what the government ought to be doing is actually cutting taxes. It should be giving a fiscal stimulus to the economy.”

The BBC’s political editor Nick Robinson said the party was privately preparing for a situation where tax rises would be hard to avoid.

But shadow chancellor George Osborne told the BBC later: “We are not at that stage yet and I hope we wouldn’t be at that stage.

“What we have said is we can’t over promise, we are very careful not to promise tax cuts because we knew the public finances would be difficult.

“We have put stability first and of course our long term ambition is to be able to reduce taxes once you get government living within its means.”

‘Lower tax burden’

Robert Chote, director of the Institute for Fiscal Studies, said the weakness of the economy, housing market and stock market meant “whoever wins the next election is likely to be under pressure to increase taxes, rather than have scope to cut them”.

But Lib Dem leader Nick Clegg said earlier he hoped to fight the next general election on a radical tax cutting programme.

He told the BBC: “The Liberal Democrats are pledged to lower the tax burden on people on low and middle incomes and we are in the middle of an exercise now to identify up to £20bn worth of government spending that we think could be better spent elsewhere – or could represent money which could be given back to people directly.”

“We have already made changes to UK law into the Enterprise Act 2003 to help companies through difficult times” John Hutton Business secretary

In a speech to the CBI, Mr Cameron also said the Conservatives would adopt a version of the US chapter 11 bankruptcy protection scheme to give businesses a “breathing space” to establish funds and save job.

Mr Cameron said the credit crunch meant more companies were finding it hard to get hold of the funds they need to survive – and are increasingly facing liquidation, leading to job losses.

“In America they have Chapter 11 which is a stay of execution,” he told BBC Radio 4′s Today programme.

“Instead of companies going straight into liquidation and having to lay off staff, they get a stay of execution and they can be restructured to try to save the business, to try to save the jobs.

“Now that doesn’t actually cost taxpayers money, but at a time when we’ve got economic difficulty and at a time when companies may get into these sorts of problems, we ought to be taking action now, showing leadership now to try to save those jobs.”

US companies filing for chapter 11 keep control of their assets and daily operations as negotiations continue in the bankruptcy court.

‘Incompetent executives’

The Conservative plans would allow courts to grant protection to a UK business that could not pay its debts, but had a good chance of restructuring successfully.

Business Secretary John Hutton said the Tory plans would cause banks to tighten their lending and put more companies into trouble.

“We have already made changes to UK law into the Enterprise Act 2003 to help companies through difficult times,” he said.

“Importing chapter 11 into the UK is a poorly thought through idea from the Tories. Chapter 11 in the US is a more expensive, court-based system of administration.”

Liberal Democrat Treasury spokesman Vince Cable said: “The Conservatives claim to support free fair and competitive markets, yet they now seem hell bent on introducing a measure which only helps incompetent executives.

“Chapter 11 allows people who have mismanaged their companies to continue to run them free from their debt and pensions obligations.”

News reported by BBC