Nigel Farage used his party conference speech to say child abuse in Rotherham took place on a huge scale as a “direct result” of Labour’s political correctness.

The Ukip leader hit back at critics who accuse the party of using the scandal for political purposes, saying: “If this isn’t political, what is?”

He was speaking a day after the father of the main prosecution witness in Britain’s biggest child sex grooming scandal has criticised Farage for exploiting the issue in a Manchester byelection.

Despite this, Farage made the issue a key part of his speech, telling the audience of 2,000 delegates: “What we have seen in Rotherham in particular – but there have been other examples of it too – what we have seen within the one-party state as a direct result of [Labour’s] national policies and as a direct result of their own political correctness at a local level is child abuse that has taken place on a scale that I think is actually difficult for decent people to even comprehend.

“I think it is just about one of the most shocking things that I have seen in my lifetime in this country.”

At Ukip’s biggest ever conference, held in Ed Miliband’s constituency town of Doncaster, the party unveiled a mishmash of policies designed to appeal to former Labour and former Conservative voters.

Farage said Ukip was not about “right and left, but right and wrong”. Some of its more rightwing policies included tax cuts of £12bn paid for by leaving the EU and slashing foreign aid, paying for the abolition of inheritance tax, and a new 35p income tax band for some higher earners.

The party also pledged to bring down immigration by almost 80%, allow employers to discriminate in favour of British workers, check that foreigners are not ill and have medical insurance before they are allowed to enter the country, and make sure immigrants without ID are turned away at the border by withdrawing from the Dublin treaty. UK people would also get priority over all other foreigners in queues at passport controls, Ukip said.

Some other ideas were designed to attract the left, including a luxury goods tax, which could see VAT of 25% on shoes costing more than £200, handbags more than £1,000 and cars more than £50,000, a move the party believes could raise money from the wealthy.

The party also said it would take the lowest paid out of tax and work with unions to fight a US-Europe trade deal that critics fear could let American private health providers into the NHS.

The conference, which is taking place at the racecourse in Doncaster, is pitching strongly for the blue-collar vote. Farage tried to paint Ukip as the party of the working man and criticise Labour for abandoning its traditional heartlands.

However, Labour is for the first time fighting back against Ukip’s challenge, portraying Farage as “more Tory than the Tories” and a man leading the party of extreme tax cuts for millionaires and plans to make people pay to see their GP.

The conference has so far passed with less drama than last year, when Farage sacked the then MEP Godfrey Bloom, who had overshadowed the event with a sexist joke. However, a lunch about women in Ukip descended into a row as angry female MEPs tried to stop men at the back making too much noise.

Some of the colourful fringe events at the conference include meetings about “how to tear chunks out of Labour”, an address by two Christian B&B owners sued for banning a gay couple from staying overnight, and a session on the case for independence in southern Yemen.

The party is growing in strength after topping the European elections and winning a swath of council seats. It is particularly strong in southern coastal areas such as South Thanet, where Farage is standing next year, and Clacton-on-Sea, where the Tory defector Douglas Carswell is expected to win a byelection this month.

Labour insiders are increasingly worried about Ukip’s threat in some northern areas, particularly Heywood and Middleton, where the party has been out in force in recent weeks while Westminster MPs have been concentrating on winning the Scottish referendum.