Birmingham MPs warn Gordon Brown over 10p tax compensation

May 7 2008 By Jonathan Walker

BIRMINGHAM MPs today warned Gordon Brown he must spell out full details of the compensation package for people who had lost out as a result of the scrapping of the 10p rate.

Roger Godsiff (Lab, Sparkbrook & Small Heath) said: "If we revealed the details three weeks ago, Labour wouldn’t have fared so badly in last Thursday’s local elections."

Gisela Stuart (Lab, Edgbaston) said she was also backing calls for more information about the compensation plans.

They were speaking as Ministers tried to head off a fresh rebellion over the scrapping of the 10p starting tax rate yesterday.

Alistair Darling, the Chancellor, was meeting Frank Field, the backbencher who has led opposition to the changes.

Labour MPs called off their rebellion last month because they believed they had secured an agreement that everyone on a low income who became poorer as a result of the abolition of the 10p band would be compensated.

But since then, doubts have emerged over whether the package drawn up by Mr Darling will apply to everyone, and whether it will be backdated to ensure nobody is out of pocket.

Mr Godsiff said: "I have said right from day one that we need to give clear assurances about this. I know for a fact that the 10p issue was a big factor on the doorsteps last week."

The local elections saw Labour lose six seats in Birmingham. Gordon Brown’s party lost eight seats in Wolverhampton, losing overall control of the city, and lost control of Nuneaton and Bedworth to the Tories.

The Prime Minister is expected to dump a series of policies thought to be unpopular with the public, such as a planned "pay as you throw" bin tax which would charge people more according to the amount of rubbish they produce.