Promise of jam tomorrow is not enough

11.21.00pm BST (GMT +0100) Fri 25th Apr 2008

Liberal Democrats in Birmingham have attacked Government offers to compensate low income earners losing out under tax changes as "vague promises of jam tomorrow".

The doubling of the 10p income tax starter rate was announced last year but was put into operation at the start of April after Labour MPs voted for it in March. Since then, Labour MPs have suffered a backlash from low income people whose tax rates were doubled by Gordon Brown.

"Thousands of Birmingham residents have been hit hard by Labour's decision to double the 10p income tax starter rate," said Councillor Alistair Dow. "Labour MPs, having only just voted to put this tax rise into operation, suddenly started shouting about how terrible it was.

"It is disappointing that they have caved in and agreed to back the Government's last minute offer of vague promises of compensation. All that is on offer is jam tomorrow. There are no details of how the compensation scheme will work.

"Having previously been told there was no money in the kitty to reverse the tax rise, the Government has failed to explain how they will pay for the compensation scheme.

"And as is so often the case with this government, we should believe it when it happens. In the meantime, those on low incomes in Birmingham continue to lose out whilst Gordon Brown's tax rises bite into pay packets and pensions.

"It is staggering that in the same week as vague concessions for some of the lowest paid people in the country were dragged out of the Government, Gordon Brown's door to Downing Street was wide open for bankers to visit him and successfully argue for £50 billion bailout from the taxpayer to keep the banking system afloat.

"There is something seriously wrong when a Labour Government turns its back on ordinary people."