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Iron Chancellor to leaden Prime Minister


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brownjune.jpgOne of Gordon Brown’s favourite speech writers is leaving Number 10 to return to the Treasury. That gives Brown the perfect opportunity to draft in someone who has the ability to coin the kind of phrases that chime with the electorate and stick in people’s minds.

To date, that is something Brown, whose dismal year in office was underlined on Friday with a humiliating fifth place by-election finish for Labour, has signally failed to do. Sure, Brown wanted to move away from the accusations of endless spin that soured the public mood towards his slick predecessor Tony Blair.

But the mantras Brown has chosen to repeat ad nauseum since he took up the mantle of Prime Minister have failed to stick. Stressing how many people Labour has taken out of poverty in the past decade, or the need to take “long-term decisions” just isn’t working.

People need reassurance over fuel and food prices, over crime and security, but perhaps more than anything they need to be convinced Brown understands — and cares.

Think pensions to get one up on Chancellor


darlingblog1.jpgTax: it’s all getting a bit of a drag. The number of people paying the highest level of income tax has almost doubled since Labour came to power, according to recent statistics.

“Fiscal drag” — a fancy name for failing to uprate tax thresholds and allowances in line with wage inflation — has meant that many hundreds of thousands of middle earners (such as higher-paid teachers, nurses, police officers and many civil servants) have been trapped into paying 40 pence to the Exchequer for every pound on some of their earnings.

Is free swimming worth the cost?


swimm.jpgThe over-60s will be able to take a dip at their local council pool for free across England from next year under government plans announced on Friday.

The scheme is costing 140 million pounds over two years, although part of the money will also be available for lifting admission costs for children under-16 and for maintainance work on ageing facilities. A similar scheme is already operating in Wales.

Oil prices – fuelling more problems for Labour?


fuel.jpgRoads into London and Cardiff are expected to be jammed with lorry convoys as part of a protest at the soaring cost of fuel.

Average prices have risen during the past month by their highest margin this century to 114.2 pence per litre of petrol and 126.7 pence per litre of diesel, the AA says.

Darling’s tax fix wins few plaudits


darling111.jpgThe Daily Mirror is alone among the papers in giving unqualified praise to Chancellor Alistair Darling’s 2.7 billion pound solution to the damaging 10p tax row.

Once critical Labour MPs hailed it as a masterstroke,” the paper said. “Hopefully it signals the start of a concerted fightback by a prime minister who has been on the ropes for months.”

Wednesday’s front pages


times-wed-may-14.jpgThe papers are nearly all agreed that Chancellor Alistair Darling’s 2.7 billion pound fix for the 10p tax row is the day’s main story.

Darling seeks end to 10p tax backlash” reports the Financial Times, noting that the move will still leave 1.1 million poorer households worse off following the abolition of the lowest tax band in last year’s budget.

Dear Chancellor… What would be in your letter to Darling?


darling.jpgLabour might appear to have calmed the storm over the scrapping of the 10 percent income tax rate for now. But new research shows the extent to which Britons are peeved about the level of income tax.

When asked what would be their key requests of Chancellor Alistair Darling, the largest proportion of more than 3,000 people polled for — 31 percent — said they’d like to see a cut in income tax. And, it seems, many Britons feel an obligation to help the less well-heeled: while 12 percent would like to see it reduced for everyone, 19 percent want a cut for less affluent sections of society.

Wednesday’s front pages


indycut2.jpgThe crucial poll win in Pennsylvania by US presidential hopeful Hillary Clinton came too late for many newspapers, who predominantly went instead with rising food prices and fears for a missing boy in Wednesday’s headlines.

THE INDEPENDENT: The Chilling Message From Zimbabwe’s Church Leaders

The paper runs a dramatic quote in red and black letters which says: “If nothing is done to help the people of Zimbabwe, we shall soon be witnessing genocide similar to that in Kenya and Rwanda.” Story here.

Should the 10p tax rate have been scrapped?


darling1.jpgA possible Commons rebellion by Labour MPs next Monday over the scrapping of the 10p starting tax rate has been averted but the episode has further damaged the standing of Gordon Brown.

In 2007, in his last budget as Chancellor, Brown abolished the 10p rate as he reduced the standard income tax rate to 20 from 22p and reformed National Insurance thresholds. Many backbench government MPs felt that hitting some of the poorest sections of the working population in such a way was an affront to their basic Labour principles.

Another “slap in face with wet kipper” Budget


francesca-lagerberg-2.jpgBy Francesca Lagerberg, head of the national tax office, Grant Thornton

Most Budgets have all the attraction of being slapped in the face with a wet kipper and sadly this one is unlikely to reverse the trend. As expected, from today up goes the cost of booze (4p on a pint) and fags (11p on a packet). Also for those who like driving larger less-green new cars there is a “showroom” tax coming in from 2009 that could cost them around 950 pounds.

However, for the entrepreneur there was a little cheer. After strong representations from business, Chancellor Alistair Darling has deferred the “income shifting” rules that were due to start from this April. These were a direct attack on family-owned businesses that include lower tax paying family members who take out dividends or profits but make a less significant contribution to the business. A case last year (Jones v Garnett) went against the government and it was looking to legislate to get the result it wanted. The proposals were wide-ranging and ill-targeted. A deferral will hopefully allow time to revisit this whole approach.