Osborne reveals Tory plans to reverse 1% rise in National Insurance
Osborne reveals Tory plans to reverse 1% rise in National Insurance
Monday 29th March 2010
Conservative shadow chancellor George Osborne has announced the Tories would block part of Labour's plans to increase national insurance contributions if they win the coming general election.The opposition claims their plans would mean seven out of ten workers would not be affected by the planned one per cent increase in contributions for those earning more than £20,000, set to come into force in April next year.
Employees on higher salaries will still face the one per cent increase however.
Announcing the plans at a press conference in central London on Monday morning, Mr Osborne said: "Labour's national insurance tax increase is a tax rise on working people.
"Quite frankly, it is the economics of the madhouse.
"We are not going to tax the recovery. We are not going to tax families on modest incomes."
The move would be funded by spending cuts, instead of tax cuts elsewhere, the Conservatives claim but their plans have already been criticised by the other main parties.
Responding to the news of the new Tory policy, chief secretary to the Treasury Liam Byrne said: "They [the Conservatives] have entirely lost sight of cutting the deficit.
"Rather than making more promises he can't afford, the test for George Osborne is to tell people how he'll pay for the ones he's got."
Chancellor Alistair Darling announced the rises in National Insurance during his pre-Budget reports in 2008 and 2009.
The argument over whether to implement the changes is expected to now feature heavily in the televised debate between Mr Darling, Mr Osborne and Liberal Democrat Treasury spokesman Vince Cable on Channel 4 tonight.
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