New Labour 'pledge' on economy

THE extent to which the economy will figure centre-stage in the General Election campaign was highlighted today as Labour kicked off the next stage in their pre-election campaign with a series of key economic pledges for a third term in office.

Prime Minister, Tony Blair and Chancellor of the Exchequer Gordon Brown are appearing in south London for the first of a series of presentations which Blair will take part in across the country. At each there will be a separate promise to voters on what the party will do if re-elected.

Top of the Labour economic agenda will be packages to help first-time homebuyers, raising the minimum wage and putting more people on benefits into work.

Blair said that the economy would be a key part of the General Election campaign. He added: 'We will make sure that the British people get the economy that we need and also that we equip them for that economy in the 21st century.'

Brown declared that the years since the party's 1997 election victory had seen Britain's economy blossom. 'I believe that a Labour Government is the only Government that can be trusted with the British economy,' he said.

Critics claim that the decision to leak papers relating to the Conservative Government's handling of the economy and particularly over Black Wednesday when Britain pulled out of the European exchange rate mechanism (ERM) reflects Labour nervousness on the economy.

The party fears that taxpayers may not share its rosy view of the economy and could even punish it for the host of tax rises implemented since it came to power.

Blair was put on the back foot at Prime Minister's Questions on Tuesday when he was pressed by Opposition leader Michael Howard over plans to put up rates of National Insurance Contributions and did not categorically rule out further increases.

Today Blair was also asked today whether the Chancellor would be staying in his job after the election and failed to provide a categoric assurance, fuelling talk that the two men have still not settled the rift between them.

Blair did, however, praise Brown's stewardship of the economy. He said: 'He's done an absolutely superb job and I am sure he will carry on doing so.' The pair appeared in front of a poster proclaiming Labour's slogan: 'Britain forward not back'.

At the end of their presentation a pledge card carrying the new slogan 'Your family better off' was unveiled.

Shadow chancellor Oliver Letwin dismissed the Prie Minister's claims today, insisting that tax would be the main focus of the electorate's thinking on the economy.

He said: 'It is striking that Labour's 'economic pledge' doesn't say a single word about tax. Almost every serious economic commentator says Labour's plans mean big tax rises after the election if Labour are re-elected. It is not a question of whether Mr Blair will put up taxes if he was re-elected - but which taxes he would put up?

Letwin added: 'If the respected independent Institute for Fiscal Studies is right, Labour's policies will mean £11bn of tax rises straight away - a 3p rise in National Insurance that is equivalent to £1,000 a year extra to pay for a typical working couple. Instead of woolly and meaningless talk about the economy, what the British public need from Labour is an honest answer to the question: which tax are you going to raise?'