Vincent Cable: The dance-crazy politician aiming to match Gordon Brown step for step

It's strictly ballroom for Vincent Cable, the Liberal Democrat Treasury spokesman. Mr Cable, a former chief economist at Shell, is busy practising his rumba moves for an exam in Latin dance.

"I do lots of dancing exams: waltz, foxtrot, tango and quickstep, rumba, samba, jive and rock'n'roll. I am working on my rumba and keeping my legs straight at the moment," he said. "It's one of the ways that I switch off."

At the Liberal Democrat annual ball, the 60-year-old MP for Twickenham stunned colleagues by gliding across the dance floor, Fred Astaire style. But, this week, he is preparing for another form of quickstep. On Wednesday, he faces a fast-paced tango with Gordon Brown during the pre-Budget report debate.

Unlike most other MPs who quake at the prospect of a budget clash with the Chancellor, Mr Cable is not intimidated. The Cambridge-educated man is familiar with the strengths and deficiencies of his adversary, whom he has known for 30 years. They first met in Scottish Labour politics in the 1970s and even co-wrote a book.

"I was a Glasgow councillor when he was rector of Edinburgh University. We did a book called the Red Papers for Scotland. It was a series of essays by people who were active at that time on the left of politics in Scotland. I was one of the authors, as was Robin Cook. I wrote about inner city deprivation and poverty, from my experience of being a councillor in an inner city ward in Glasgow. Gordon wrote the theoretical overview," he said. "He was obviously a very clever guy."

Mr Cable says this early insight into Mr Brown's motivations has helped expose lapses of logic in his argument today. "He was clearly quite intense and very idealistic and very preoccupied with issues of what we now call the social justice agenda," he says. "That's why I now tease him about how is it that a politician with such an obvious commitment to fairness and social justice is presiding over a tax system where the bottom 30 per cent are paying more in tax than the top 30 per cent?"

Mr Cable is a peer of a generation of Scottish politicians, including Robin Cook and Donald Dewar, who scaled the heights of Labour politics into government. At only 25, he became an economics lecturer at Glasgow University, and some say he could have risen up the Labour ranks with comparable ease. But the economist abandoned such prospects when he left Labour to join the SDP and later the Liberal Democrats. It took him 27 years to finally make it to the House of Commons.

"I first tried for Parliament in 1970. At the time, I felt very frustrated because I really wanted to get involved in politics, but waiting had two enormous advantages. One was that I was able to really spend proper time with my family and the second was that I was able to do lots of other interesting things," he said.

Since being elected to the Commons six years ago, the MP, who has the kindly and thoughtful manner of a serious academic, has brought a new rigour to the Liberal Democrat frontbench team.

Mr Cable is one of the party's best minds and most capable parliamentary practitioners. Yet he was little known outside the party until the last election, partly because, during his first term, he divided his time as an MP at Westminster with nursing his late beloved wife, Olympia, an erudite woman of Indian descent, until she died of cancer. "It left me with a life-long admiration for people who are carers," he said.

Mr Cable is soon to marry again, having recently proposed to a female farmer from the New Forest. But he kept his engagement secret from even his Westminster staff. "Her name's Rachel. She has a farm near Brockenhurst. We are getting married," he said shyly, trying to stifle a growing smile.

In a House of Commons characterised by rampant egos and showing off, Mr Cable is the most self deprecating of MPs. He flouts received parliamentary protocol by sitting with Lib-Dem backbenchers when he is not leading for his party in a debate, and by praising opponents if they do something right, including Gordon Brown.

"I don't have any time for the yah-boo stuff. I think it's silly. I always try to be fair and sensible and say Gordon Brown had some genuine achievements as chancellor," he said. "There has been more stability, macroeconomic stability and we have had steady growth and falling unemployment. These are the plusses. But we have a very seriously unbalanced economy. The manufacturing base and overall investment have seriously collapsed. There has also been a trend to heavy over-regulation, including an overly complex tax system."

His admirers say that he, along with Menzies Campbell, is one of the few MPs of cabinet calibre on the Liberal Democrat benches and has a "Rolls-Royce mind". But his insistence on flawless sums and logically reasoned arguments has irked some of his colleagues who, faced with a dressing-down for sloppy homework, have accused him of being right wing.

"I suspect why people use that language is because I am an economist who believes in open markets. That is not terribly right-wing. There is a fair degree of consensus and that's the only way one should function these days," Mr Cable argued.

He is generous with his praise of his predecessors as the Liberal Democrats' shadow Chancellor but, since taking over the post in October, he has introduced fresh discipline to proceedings.

"I am trying to emphasise being very strict about our approach to taxation and expenditure and being very precise and controlled in what we say," he said. "I am trying to insist that any spending commitments at the next election will be funded out of cuts of other things. Having a disciplined approach to finance is not necessarily right wing."

Last week, during Prime Minister's Questions, Tony Blair launched an attack on the Liberal Democrat's tax and spend plans, claiming the party's sums did not add up. That claim seriously annoys Mr Cable who has been poring over the party's books to make sure they are balanced. "A lot of our policies are wilfully misrepresented. It's very irritating. It's puerile because we go to great efforts to ensure the numbers do add up and to have the numbers tested. There's some serious economics behind this," he said.

Mr Cable is happy to debate his policies ­ including scrapping the council tax and replacing it with a local income tax which he admits could lead to higher bills for some households that are home to several high-earning adults.

"We needed a fairer system of taxes," he says. "The people at the bottom 30 per cent are paying considerably more of their income in tax than the people at the top 20 per cent which is a ludicrous state of affairs in this country."

Another of the economist's concerns is the increasing burden of debt on consumers and the willingness of unscrupulous lenders to make loans that people cannot afford to pay. He warns that the bubble in the housing market could "very suddenly" burst unless the Government takes action.

He favours "naming and shaming" banks that saddle customers with unmanageable loans. "There is a dangerously over-extended expansion of debt and the mirror image of that which is the bubble in the housing market," he said. "At the moment, that is holding up because we have historically very low interest rates and there is a fair degree of consumer confidence but one could see how it could very easily fall apart.

"A very sharp fall in house prices would trigger it. I am not predicting but I am saying the conditions are there. The whole history of capitalism is of asset bubbles which collapse ­ from the Dutch-tulip bubble to the dotcom boom and you can see all the conditions at present for something similar to happen."

Mr Cable is wary of predictions. But he says his background in industry has taught him the need for long-term planning. His eye is firmly on government and he believes the Liberal Democrats must behave like ministers in waiting if they are serious about power. But he is coy about when his party will enter government and claims he is "not really into the forecasting business" whether economic or electoral. As if to prove it, on his wall at Shell, Mr Cable hung a plaque that read in Arabic: "Those who claim to forecast the future are lying ­ even if by chance they are later proved right."

THE CV

AGE: 60

EDUCATION: Fitzwilliam College, Cambridge (MA, Natural Sciences; president of the Cambridge Union)

Glasgow University (PhD, Economics)

1966-68: Finance officer, Kenya Treasury

1968-74: Lecturer in economics, University of Glasgow

1974-76: First Secretary, Foreign and Commonwealth Office

1976-83: Deputy director, Overseas Development Institute

1983-90: Special adviser, Commonwealth Secretariat

1990-93: Group planning department, Shell. MP for Twickenham in 1992

1993 - 95: Head of economic programme, Chatham House

1995 - 97: Chief economist, Shell

1998: Liberal Democrat Treasury spokesman

FAMILY: Married Olympia Rebelo, now deceased, in 1968 - two sons, one daughter. Now engaged to Rachel, a farmer

LIKES: Ballroom dancing, walking, boatyards - he is campaigning to save Twickenham's Eel Pie Island boatyard from commercial development

DISLIKES: Graffiti, the District Line - he is campaigning for an extension, sloppy political debate