ALISTAIR DARLING yesterday said Labour was still on the side of business, insisting there would “be no return to the 1970s” if his party wins an historic fourth term.

Responding to suggestions that Labour’s general election manifesto showed the party was lurching to the left, he replied: “Not a bit of it – this is as New Labour as it’s ever been.”

Speaking exclusively to City A.M. en route to a campaign stop in Milton Keynes, the chancellor defended plans to keep the 50p top rate of tax in force and to increase National Insurance contributions for all workers earning over £20,000.

He said: “The reason I’ve done this is because we’ve got to have a credible plan to reduce the deficit over a four year period. The Tories have said they’re going to cut further and faster, but they won’t say how.”

And he dismissed suggestions that proposals to make it harder for foreign companies to take over British firms were protectionist, arguing it was essential to revisit the takeover code in light of Kraft’s acquisition of Cadbury.

“There was a lot of concern over the Kraft takeover of Cadbury. A lot of people acquired shares after the [takeover] was announced, and you had to ask what their long term commitment to Cadbury was,” he said.

The chancellor’s comments come at a time of strained relations between Labour and business, with a long line of chief executives queuing up to support the Tory party’s economic programme.

Meanwhile, the chancellor hit out at Conservative plans to impose a unilateral £1bn levy on banks to fund their tax break for married couples, arguing it could convince firms to flee the UK.

“I don’t want to do anything that would make people think about going somewhere else. There is a substantial risk that if you do something unilaterally, they have that option,” he said.

The Tories say they would be willing to impose a £1bn levy on the banking industry even if they cannot secure a global consensus, although they are confident that such an agreement can be brokered.

In a wide-ranging interview, Darling admitted Labour was entering the election campaign as the “underdog”, but said voters would ultimately decide that voting for the Tories was too much of a gamble.

“I think their indecision, their history of making the wrong call, the wrong judgement – that’s the risk that voters take.”