Miliband fears 'cost of living crisis'
Monday, 28 February 2011 12:00 AM
Ordinary people will continue to struggle even after the economy recovers, according to the leader of the opposition.
Ed Miliband warned that the government's "fixated" approach to spending cuts and tax rises would hit ordinary families in Britain for many years to come, in a speech to the Resolution Foundation.
He cited cuts to the childcare element of the working tax credit, the rise in VAT and the scrapping of child benefit as examples of the coalition's negative impact on what he has previously called the 'squeezed middle'.
That phrase did not appear in today's speech, but he did not abandon the rhetoric altogether as he lamented the "squeezed wages, squeezed prospects [and] squeezed aspirations" of ordinary Brits.
"While those at the top have continued to do well, middle earners are no longer guaranteed to share in our nation's success," he said.
"The result is a quiet crisis that is unfolding day-by-day in kitchens and living rooms in every town, village and city up and down this country."
Mr Miliband dismissed the coalition's arguments that the raised threshold for the personal tax allowance would help many.
"Let me be clear. If they can offer some relief for hard-working middle and low earners in this way then Labour will support it," he said.
"But I'm not going to fall - and the country isn't either - for a big tax con. Funding rises in the personal allowance through tax rises elsewhere like VAT and cuts to family tax credits and child benefit isn't making the tax system fairer, it's giving with one hand and taking away with the other."
The Conservatives responded by pointing out that the coalition's deficit reduction plan had been backed by the Obama administration, the IMF, the OECD, the IFS, the CBI, 35 leaders of major British businesses, the European Commission, the World Bank, all three major credit rating agencies and the world's biggest bond trader.
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