Nick Clegg isolated after party splits on health and tax Nick Clegg, the deputy prime minister, and Liberal Democrat peer Shirley Williams vote on the NHS reform bill at the Lib Dem conference in Gateshead. Nick Clegg's leadership came under its most severe challenge since the coalition was formed when the Liberal Democrat conference at the weekend refused to endorse the health bill, and he faced a damaging public split in his party over his plans to force the rich to pay a minimum proportion of their earnings in tax. After extraordinary manoeuvring, the Lib Dem spring conference in Gateshead voted by 314 to 270 to delete a call for the party's peers to vote for the health bill's third reading, the nearest the delegates could get to outright rejection of the legislation. Clegg and his frontbench were left voting in the minority after a passionate 45-minute debate. Clegg's aides said the reverse would not change the peers' fundamental approach to the health bill, but the deputy prime minister himself acknowledged the strength of feeling in his party grassroots by effectively disowning the bill as not a Liberal Democrat one, remarks that will anger the health secretary, Andrew Lansley. Earlier in the weekend Clegg had urged delegates to endorse the parliamentary party's approach, and told them to support Lady Williams, their senior peer, rather than Andy Burnham, Labour's shadow health secretary. However, senior party figures said they will now be privately telling Clegg he has to show he is listening to his party and that further substantial changes should be sought, even though the bill has nearly completed its tortuous parliamentary passage. The Lib Dem deputy leader, Simon Hughes revealed he will ask Clegg to demand that the Department of Health publish the health bill's risk register, assessing problems that could be caused by the reforms. The information tribunal ruled last week that the register should be published; the department has not yet responded to its ruling, but it clearly fears it would trigger another round of debate. Hughes argues that his party's credibility as supporters of freedom of information legislation is also at stake. An attempt may be made in the final stages of the bill's Lords passage to demand the publication of the register. Last month, Hughes said he thought there would have to be a change in the ministerial team at the Department of Health. Some would like to see Stephen Dorrell, the Tory chairman of the Commons health select committee, take the role. He would also like to see the government establish an independent body, possibly a parliamentary select committee, to monitor the impact of the legislation, and to send out early warnings if problems are developing. Clegg himself acknowledged a major operation has to be undertaken to win back the support of the health professions, who have been deserting the bill. But the Hughes proposals will exasperate the Conservatives, who want the legislation on the statute book as quickly as possible. Clegg in his conference speech did not give a direct response to the conference vote, but came close to disowning the legislation, saying: "It is not a Liberal Democrat health bill, but it is a better bill because of the Liberal Democrats. Competition will be the servant of healthcare, not the master, because this is a coalition government. This is a bill for patients, not profits. Former Lib Dem MP Dr Evan Harris said: "The Liberal Democrats have clearly and democratically told their leaders that they do not support the bill. This cannot be ignored. He said many would want to see the bill withdrawn, but others would like see further changes in line with the party's policy. Party activists acknowledged they could not tell peers how to vote, but felt at least their political honour had been salvaged by the expression of their opposition. Burnham said: "This discredited bill has lurched from one disaster to another and, with this vote, has reached crisis point. Liberal Democrat members have withdrawn permission from their MPs and peers to pass this bill. They have stood up for the NHS and I applaud them for it. The frustration for Clegg is that his immediate priority is to negotiate a deal on the budget that would see the threshold on personal income tax lifted to £9,000 in 2013 and £10,000 in the 2014 budget. Clegg and the Treasury chief secretary, Danny Alexander, are due to meet David Cameron and George Osborne to go through the final options on how to fund the tax cut for the poor. But Clegg's credibility was undermined when allies of the business secretary, Vince Cable, ridiculed Clegg's eye-catching plan for a tycoon tax, a minimum tax take rate for the rich. Clegg is not said to be pressing the idea for this budget, but wants to see it on the table for the next one. Lord Oakeshott, who is close to Cable, described the idea as superficially attractive, but unworkable. Oakeshott believes that the proposal takes the political momentum away from the idea of a mansion tax, a property tax designed to tackle wealth and hit rich non-residents. In a public rebuke to the wealthy Oakeshott, Clegg said the only person opposing the tycoon tax was "the party's own tycoon."