Plaid MP: ‘10p tax rate controversy proves PM out of touch with party and electorate’

The Prime Minister could face further embarrassment over the decision to scrap the 10p bottom rate of income tax as announced in the 2007 Budget, following this afternoon’s vote in the Commons.

The abolition of the 10p rate came into force in April last year alongside a reduction in the basic rate of tax from 22% to 20%. If today’s amendment is passed, ministers would have to produce proposals to ensure that no person will be worse off from the change.

The motion has widespread support from Plaid Cymru, opposition parties and Labour rebels. Plaid Cymru has called for people on the lowest incomes to be taken out of the income tax bracket all together.

In advance of the vote, Plaid Cymru’s finance spokesperson Adam Price MP commented:

“The decision to abolish the 10p tax rate is one that never should have been taken either. It is irresponsible that those from the poorest sections of our society are being penalised in this way.

“There is no doubt that thousands of people on low incomes are now worse off since this was introduced. It’s a crazy situation that should never been allowed.

“The Government’s initial clumsy attempts to compensate for this blunder by introducing larger personal tax allowances do not go far enough either.

“What should be happening is that these people are taken out of the income tax tier all together. They cannot afford to shoulder the burden, especially in these sensitive economic times.

“The controversy surrounding this motion is embarrassment enough for the Government. If they are indeed voted against by the opposition and by rebels from their own benches – then Gordon Brown faces another U-turn.

“This is yet another example of the Prime Minister being forced to backtrack because he isn’t engaging with the House or his own backbenchers.”

“IT’S TIME TO GET FAIR” – MPs TO SIGN POVERTY PLEDGE

Over sixty charities and community organisations have come together to challenge MPs across the country to act now and protect the poorest in society who are hardest hit by the recession.

After weeks of the expenses scandal and having elected a new Speaker for the House of Commons to clean up their own act, MPs returning to their constituencies at the weekend face calls to sign a Poverty Pledge (26-27 June). Local groups will meet with over 100 MPs in their constituencies, raising local issues and pressing the case for change nationally. Many more MPs are being lobbied across the UK.

Vanessa Stanislas, chair of Get Fair and Chief Executive of Disability Alliance said: “With the economy in recession and rapidly rising unemployment, it’s time to get fair – that’s why we are calling on MPs to sign the Get Fair poverty pledge. Once people find themselves living below the breadline, it is virtually impossible for them to pull themselves out of poverty. Things will only get worse, not better unless action is taken. All politicians and political parties should commit to make the UK a fairer place and help bring an end to poverty.”

Get Fair is calling for immediate action to:

· Put planned changes to welfare benefits on hold: with a rapid rise in unemployment, current government plans will result in severe hardship for many families

· Increase the number of social rented homes by 45,000: house building has almost stopped and repossession rates are rising as people lose their jobs

· Protect local services: additional funding focused on quality public services that reach those most in need

Poverty Pledge for MPs: "I undertake to use, or support the use, of all policy powers available to parliament to meet poverty targets and include concrete measures in my party manifesto to achieve a lasting reduction in poverty in the UK."

Get Fair members include: Oxfam; Shelter; Age Concern/Help The Aged; Disability Alliance; Refugee Council; Church Action on Poverty; YWCA; Church Urban Fund.

Government is right to fund charity campaigning, ActionAid says

ActionAid's head of policy and campaigns, Belinda Calaguas, defended the right of charities to campaignthis week and welcomed the Government's £750,000 plan to support 'innovative political campaigning' by smaller charities.

She said: "Saying that charities should not campaign is like saying that fire brigades should stick to fighting fires and stop doing fire prevention work.

"Like most anti-poverty charities, ActionAid decided years ago that to fight poverty, we had to fight the causes of poverty. So we campaign for things like sustainable food production, which can help to end hunger. We campaign for tax transparency, which helps to prevent multinational companies spiriting money away out of poor countries. We campaign against things which perpetuate poverty, like the oppression of women."

Ms Calaguas rebutted the charge that charities are getting 'too political'.

"We don't think 'political' is a dirty word. When we run a campaign we ask our supporters to lobby their MPs, join non-violent events like last month's Put People First rally, and generally be active citizens. We particularly want young supporters, who may be disillusioned with politics, to realise that there are things they can do which will make a difference.

"Charity law allows us to campaign on our issue - poverty. And when you look at the causes of poverty in the world, you have to get involved in health, education, hunger and food production, and women's rights. But ActionAid has no interest in campaigning on issues unrelated to poverty. We do not support any political party."

Though ActionAid is unlikely to benefit from the newly announced grants, it supports their aim.

"These grants are to help vulnerable groups to get their voices heard. That is something ActionAid believes in. It is at the heart of our work in more than 40 countries," Ms Calaguas said.