Comments from Paul Johnson of Institute of Fiscal Studies come as Downing Street hints at delay to work on second phase of rail link

Around 20,000 university workers are out on strike this week at more than 50 universities across the UK, despite a dramatic last-minute scaling back of industrial action.

Strikes had been set to go ahead at 142 UK universities this week as part of a long-running dispute over pay and working conditions, but it emerged last week that two thirds of branches of the University and College Union (UCU) had declined to take part.

Davey said the Lib Dem commitment – dating back to 1992 – to raise income tax by 1p to improve public services is unsustainable in the current economic climate. Originally the money raised was earmarked for education, but at the last election the party said it would use it to fund the NHS.

Speaking from Bournemouth to broadcast studios, Davey suggested the burden should instead fall on companies making “huge profits” while people struggle with the cost of living.