Free shares for the workers: Major leaks his manifesto

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The Prime Minister yesterday sought to reclaim the initiative after an uncertain start to the Tory election campaign by leaking parts of his own manifesto to encourage firms to offer free shares to their workers, and personal pensions for employees of small businesses.

The first details of the Tory manifesto may have failed to fire voters' imagination, but John Major promised an "ambitious agenda" of "very eye- catching innovations" and a "stream of announcements". Hailing the plans as the core themes of the manifesto, he announced:

Sharematch, which involves changes in Inland Revenue rules to allow firms to offer free shares to employees who buy shares in their company;

Relaxation of the rules to allow companies to set up personal pension plans for groups of employees, making it cheaper for small businesses;

Reform of the Uniform Business Rate (UBR); and the right to draw early on top-up pensions invested on top of company schemes.

Tory strategists, who claimed that their "tracking polls" were showing a narrower gap than the 25 per cent Labour lead reported yesterday, have persuaded Mr Major to announce the details to portray a government with ideas, to overcome an impression that it has run out of steam. The Tory leadership feared it missed an opportunity to steal a march on Labour on Monday when it announced that the Cabinet had agreed the manifesto at Chequers without providing any details. In a hurriedly arranged press conference at Conservative Central Office, Mr Major sought to repair the damage.

The Tory strategy is directed at securing the "grey" vote with more self- provision through insurance schemes, even if it surrenders the youth vote.

The plans unveiled by Mr Major fall short of the "property-owning democracy" hailed by Baroness Thatcher in previous elections. But he said the Halifax share conversion offer for 16 million investors was an example of the share-owning expansion he was seeking. The manifesto, he promised, would be "radical in improving people's lives" but it would "offer stability to the nation".

Alistair Darling, shadow Chief Secretary to the Treasury, immediately attacked Mr Major for announcing uncosted schemes, which could lead to more tax increases by the Tories. Echoing the Tory tax attack on Labour, Mr Darling estimated the sharematch scheme could cost pounds 50m and reforms to the uniform business rate for small businesses could cost between pounds 600m and pounds 1.5bn.

The plan to expand personal pensions was also attacked by Harriet Harman, Labour's social security spokesperson, in the wake of allegations surrounding pension-selling after the Government's drive to encourage more to opt out of state earnings related pensions in the 1980s.

The Prime Minister's first excerpts from the Tory manifesto suggest that the Government is anxious to overcome scepticism about increased wealth through ownership after the shocks to confidence caused by the collapse in house prices and the pensions debacle.

"What we're seeking to do ... is to extend pension provision and the opportunity for pension provision or share ownerships," Mr Major said. "It is a Conservative levelling-up measure, not a levelling-down measure."