Budget continues to haunt George Osborne as ministers face accusations of incompetence

 

Ministers faced accusations of incompetence and of “sneaking out” announcements of tax U-turns as the reverberations over the Budget continued to haunt George Osborne after nearly three months.

The Government was ordered to the Commons by Speaker John Bercow today to explain a series of policy reverses confirmed while MPs were away from Westminster.

They include rethinks of plans to cap tax relief on large charitable donations, to impose VAT on pasties and sausage rolls and to increase VAT on static caravans.

David Gauke, the Treasury minister, hinted that there would be no more U-turns to key Budget measures as he insisted the recent changes were tiny compared with the overall tax plans announced by Mr Osborne.

He said the retreats on charities, pasties and caravans represented just three of the 282 Budget measures and less than two per cent of the money raised by the Chancellor.

Mr Gauke said the moves – announced just before the Diamond Jubilee bank holiday weekend – were evidence that the Government was listening to its critics.

But Rachel Reeves, the shadow Chief Secretary to the Treasury, retorted: “Failing to do the necessary work on a policy before announcing it, then sneaking out a reversal when you hope no-one is looking is not consultation, it's total incompetence.”

Simon Hughes, the deputy Liberal Democrat leader, welcomed the concessions on the pasty and caravan taxes. But he also delivered a pointed criticism of ministers for failing to hammer home the Budget decision to raise the income tax threshold to more than £9,000.

“Will you make sure that all ministers will turn up the volume to get over the central message, which is that 20m people will pay less tax and some will pay no tax at all? Some people haven’t heard it,” Mr Hughes said.

The Liberal Democrat Stephen Gilbert, a Cornish MP, supported the change of heart on the “pasty tax”, adding: “It's great we finally have a Government that listens and doesn't plough on regardless.”

The Labour MP Helen Jones asked why ministers “chose to listen to representations on pasties and caravans and charities, but not on the granny tax”, adding: “Is it that pensioners don’t have loud enough voices?”

Mr Gauke replied: “We found the arguments used on the three items that we're discussing persuasive and, given that, we thought we would make the concessions that we’ve made.”

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