Bankers must be breathing a sigh of relief. After making astronomical profits using our money, that is, the money the Labour Government gave them, the Chancellor proposes that they are faced with a one-off tax that they can easily avoid. In the meanwhile many other people will be facing permanent tax increases, and in some cases redundancy, and job losses.
In his Pre-Budget Report, Alistair Darling had the chance to clamp down on bankers and their big bonus culture, and set out how he intends to guide the country out of the recession, but has failed to make any real progress.
Never before has the British Government run up a deficit like this. We need a sensible plan for dealing with it. The Labour Chancellor has avoided making any hard choices on spending and cuts. Instead of making the tax system fairer, people on middle incomes will be paying more tax, while those at the top continue to enjoy their loopholes. The costs of his budget will be paid for by low paid workers who face a cut in real wages because of the 1% pay rise – which is lower than inflation.
In a time of big demands on government spending it is important we protect public services, and the people who work in them. This means there will have to be discipline over pay. This is why the Liberal Democrats have suggested that there should be a maximum pay rise of £400 a year throughout the public sector. That would mean that workers at the lower end of the payscale would see a real increase, but not those at the top.
The Tories would freeze the salaries of millions of teachers, police officers, nurses and firemen, while cutting taxes for millionaires. But Liberal Democrat proposals would ensure pay rises for key frontline services that are fair and realistic. Many public sector workers will also benefit from the Lib Dem £700 income tax cut for people on low and middle incomes.
Liberal Democrat proposals would limit the public sector pay bill while making sure it is fair for teachers, nurses, police officers and other public sector workers. These proposals will save taxpayers about £4 billion a year while reducing the loss of front line services and protecting jobs.
Liberal Democrats remain the only party that is placing fairness at the heart of all its proposals to repair the ‘broken’ economy.