Chancellor's pledge on compensation package details

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Indy Politics

Chancellor Alistair Darling said today that he hoped to come forward with details of the compensation package, rushed forward yesterday to avert a backbench revolt over the scrapping of the 10p tax band, in the "reasonably near future".

Mr Darling told the Commons at question time that he wanted to make sure that officials had "bottomed out" how the payments could be made to affected 60 to 64-year-olds.

He confirmed that the "mechanism" to be used to make the payments was "almost certainly" winter fuel payments.

Mr Darling's comments came after Labour former welfare minister Frank Field, who led the tax revolt, warned the Government that there must be no backtracking over the the backdating of the promised compensation package.

Shadow chancellor George Osborne claimed earlier that the deal was already "unravelling" less than 24 hours after it was announced by Mr Darling, in an effort to stave off a potentially catastrophic Commons defeat.

In the Commons today, just 24 hours after the Prime Minister had been accused by Conservative leader David Cameron of making a "humiliating" u-turn, the issue was raised by Tory Anne McIntosh (Vale of York).

She said the high price of energy was hitting those on fixed incomes particularly hard.

"When are you going to be in a position to give the House details of the announcement yesterday of the extra help that's being given to the 60 to 65-year-olds?" she demanded.

Mr Darling replied: "I hope I can do that in the reasonably near future but I want to make sure that we've bottomed out exactly how these payments can be made and the mechanism we will use - which is almost certainly going to be through the winter fuel payments because it is there and you don't need to legislate for anything different."

Under the plan set out by Mr Darling yesterday, the Government will seek to help the two main groups to be hit by the scrapping of the 10p rate - pensioners under 65 and younger workers on modest incomes with no children.

The pensioners look set to be given extra cash through the winter fuel mechanism, while the Treasury is looking to help the younger workers through changes to the tax credits and the minimum wage.