Blair faces MPs' rebellion over welfare cuts

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TONY BLAIR faces a growing rebellion from Labour MPs against the Government's proposals to cut and tax benefits in order to drive down the cost of the welfare state.

Around 30 backbenchers have been meeting privately to plot their opposition to key elements of the Welfare Reform Bill, published this week. Anger over plans to slash benefits for widows and disabled people is likely to prompt the biggest rebellion on the Government benches since 47 Labour MPs voted against proposals to reduce lone parent support.

Frank Field, the former social security minister, is among those planning to speak against aspects of the Bill. Gordon Brown is set to further infuriate left-wingers when he presses ahead with plans to tax child benefit for the biggest earners.

The Chancellor is determined to implement the controversial policy in the next Budget on 9 March. The Treasury has decided that all households in which at least one partner earns more than pounds 31,295 should be liable for the levy. Mr Brown has ruled out taxing only families in which the woman is the top rate tax earner as this would raise only pounds 70m for government coffers.

The preferred model would mean more than a million families losing almost pounds 8 a week, raising around pounds 450m, enough to increase child benefit by 70p per week across the board.

However, many Labour backbenchers believe the tax will effectively end the universality of child benefit and undermine the principle that it is a ring-fenced sum paid directly to women.

Alice Mahon, Labour MP for Halifax, warned that it would be a "huge mistake". Alan Simpson, MP for Nottingham South, said it would be "stupid and incompetent". He added: "There is a lot of discomfort within the Parliamentary Labour Party about the way things are going on welfare."

The rebel MPs will meet this week, after the publication of the Welfare Reform Bill, to draw up an opposition strategy. They are likely to join with the Liberal Democrats in compiling amendments. They are also concerned about cuts in widows' pension entitlements. The proposals, announced by Alistair Darling, the Secretary of State for Social Security, last year, would save about pounds 500m.