How much is £2.7 billion?

Dramatic stuff. We've had a crisis mini-budget urgent financial statement from Alistair Darling to address the 10p tax fiasco. He has borrowed an additional £2.7 billion to put up personal tax allowances by £600 - meaning anyone earning up to £40,835 will gain £120 this year. Those in the higher tax bracket - much of the middle classes - get nothing. And it will have to be paid for at some point.

Labour MPs like John McFall, the Treasury select committee chair who was leading the revolt for the mainstream, have said they are now happy after this unfunded tax cut major spending decision ... even though there are still 1.1 million people earning between just over £6,635 and £13,355 who will (only) see their losses halved.

This is panic politics. Darling is throwing money to get the man next door out of his political nightmare. Is £2.7 billion the cost of the Crewe & Nantwich by-election? (go suck on those spending limits, Electoral Commission). Is it enough to get him through the Autumn?

Interestingly, when pressed about the size of additional borrowing, Labour MPs are trying to claim that this sum is nothing compared to £600 billion annual spend by government.

But before they dismiss it as a trivial amount of money, remember Gordon's 2000 budget. After years of sticking to Tory spending plans, Brown made much of his decision to put £2 billion into the NHS and £1 billion into education. Much was made of his generosity spending £3 billion then, as they rightly recognised it's a significant sum.

And that was during the years of plenty.

Comments

[Percy]

Well done Sam Coates, - you've hit the nail right on the head with your piece.
As one of the group with a sub-10K income who are worst affected, I thank you for highlighting the fact that borrowed money is not just being used to under-compensate the poorest who lost the most, but further benefit better-off people who have already gained from the original proposal.

[tone]

sadly, as one who gets under £13,355 i only get back half the money Brown stole from me. he also says that i owe him £15k in tax credits! but can i get anywhere with hmrc? no sir! i guess £15k is nothing to likes of blair and brown, but it is to me. a labour voter all my life, but never again. of, and the other lot are no better.

[barbara]

I too will only get back half of what I have lost. By giving those who have already gained even more, and not compensating me they are bribing the voters at my expense.

[Damien]

Right, so, we'll give the money back....for one year only, because we know next year, the middle classes will have to pay for this almighty cock-up. They are an utter disgrace.

Can anybody possibly forgive this useless excuse for an executive ever again?

Gordon Brown? The two-bob arsehole of British politics.

[RICHARD]

What a sorry mess! What a bunch of fools! Does this pass for Government these days?

[Silent Hunter]

Yet another Nulabour confidence trick.

I'm amazed that Frank Field has turned belly up over this..................so the 'Rebel for the Poor' has effectively hung them out to dry.

What was he offered?

A peerage?

[Silent Hunter]

Yet another Nulabour confidence trick.

I'm amazed that Frank Field has turned belly up over this..................so the 'Rebel for the Poor' has effectively hung them out to dry.

What was he offered?

A peerage?

[RODDY]

The very low paid are still losers, and Brown and Darling are well aware of it. But in acting this way it gave them an opportunity to bribe before the bye-election. This from the man who boasted of his moral compass.

[Mike Houston]

2.7 billion more borrowed every year. Just so Gordon can get his ass out of a tight spot. And we all get to pay it back with interest. This man is a joke, the cynisism is beyond belief.

[Mr amazing]

THEY ARE BOTH ASSHOLES. OUT WITH THEM NOW

[Arundel]

Too late Alistair, the die is cast and the damage done.
Neither you nor Gordon gave a tinker's cuss for the lower paid. You thought that giving a little extra to the middle class would buy a few of their votes, whereas the lower paid - well, they probably wouldn't vote anyway.
What a nasty, grubby little way to do politics.

[Roy]

Crash Gordon - not Flash just Moron. Please stay another two years, then the whole lot will be unelectable for 25.

[Bernard Parke]

And Noddy said to big ears !!!

[Bernard Parke]

And Noddy said to big ears !!!

[Tony]

If there are any Labour MPs of principle they would resign and end the misery and despair of the British people by forcing a general election.

[Chris Johnston]

People earning £13335 will only get half the loss back, but under this amount will be a reducing scale running from £120 at £13335 to £0 at around £6000. While it does not address the whole problem it does start to make up for the poor increases in personal allowances made while Brown was chancellor. No doubt however personal allowances will now be frozen until we get rid of this incompetent bunch.

[Damien]

So, from the beginning... The people the two-bob-arsehole meant to bribe when taking over un-eleceted before the election that never was are gonna stump up now to repay the 2.7billion for the bribe to win THE ELECTION THAT NEVER WAS?

Meanwhile, 1.1m poor punters are still gonna cop for it, but they are not your traditional swing voters like those sensitive to the 20/22p threshold.....

Why don't they just go the whole hog and launch a special Crewe and Nantwich tax relief scheme, for voters in that constituency, which shall be treated as a tax free zone Friday, after which they will do them up the ricker, just like the rest of us....

[Bexleyite]

Since when has someone on £40,000 been poor?

[Brett Nash]

My faith in Labour has been restored. I admire this fantastic labour government for having the courage to address the disaster of the abolition of the 10p tax rate. Gordon Brown has done enormous amounts to redistibute income and for that I applaud him. Whilst the increase in the personal allowance will increase the income of those that are not in most need, it sends an amzing signal to the country that Labour listen to the public's concerns. I admire Labours ethics and I would ask you to consider what the tory toffs would do to adress this issue - abolish inheritance tax? . They ought to be ashamed of themselves.

[Phil]

In other words, we're f***ed!