Mr Cable says he wants to create a 'credible' alternative

Lib Dem treasury spokesman Vince Cable said a combination of "good luck" and Bank of England independence had created economic stability in the UK.

But he said the chancellor was ignoring growing problems such as personal debt and public sector incompetence.

And the fact the UK needed so many migrant workers was a "shocking condemnation" of its schools, he added.

He was speaking after Lib Dem leader Sir Menzies Campbell won the backing of his party for ditching its commitment to a 50p top tax rate in favour of "green" taxes.

Mr Cable told delegates at the party's annual conference in Brighton he would make "tough choices" about public spending and cut government red tape.

'Good luck'

But he also said he wanted to develop a "convincing critique of Gordon Brown's economic policy".

The Brown years had seen a "virtuous circle of non-inflationary growth" thank to "good luck" and "adopting the Lib Dem policy of making the Bank of England independent".

But with rapidly growing Asian economies and soaring oil prices "warning lights were starting to flash".

But other problems - such as failing schools and welfare dependency - were home grown.

"Large scale Eastern European immigration has undoubtedly helped our economy.

"But it has brutally exposed the failures in our education system, which produces far too many young people who just can't read and write or do simple sums, and failures in a health and welfare system which cannot rehabilitate hundreds of thousands of long term disabled, many with curable conditions, including clinical depression.

"We must never fall into the trap of making immigrant workers scapegoats for our domestic policy failures, but our need for so many workers from abroad is a shocking condemnation of our education, health and welfare systems." Another major problem was "unsustainable" levels of personal debt, said Mr Cable.

"This borrowing binge assumes that interest rates won't rise - but they are; that unemployment won't rise - but it is; and that house prices won't fall - well, they very well might."

He added: "While the chancellor continues to bask in the fading glory of decisions taken a decade ago to create a framework of economic stability, there is a mounting list of expensive failures and errors, many of them directly attributable to his centralising, instincts."

Speaking earlier at the party's morning press conference, campaigns chief Ed Davey said the party planned to "mount a hefty attack on Labour" on the third day of its annual conference.

He said debates would centre on how Labour had "failed to tackle poverty and inequality".