Tories' squeeze on living 'like 5p income tax jump'

LABOUR leader Ed Miliband today claimed people were suffering a squeeze on living standards equivalent to a 5p rise in income tax.

He called on the government to use next week's Budget to help ordinary families and tax bankers' bonuses.

He was expected to tell Labour's Scottish spring conference in Glasgow: "Ed Balls and I have set two tests for the Budget. Does it deal with the cost-of-living crisis facing families up and down this country?

"People across the country are suffering an unprecedented squeeze on their living standards equivalent to as much as 5p on the basic rate of income tax this April.

"We need action to ease the squeeze, starting with a reduction in VAT on petrol.

"But they also have to meet our second test. Will it put the recovery back on track? We need measures to boost skilled employment. We need to give hope and opportunity to school leavers, and we need measures to support enterprise.

"They should do the right thing in terms of justice and prosperity by imposing a 2 billion tax on bankers' bonuses. It's time to make the people who caused this crisis pay their fair share."

Labour's Scottish leader Iain Gray was set to tell the conference this afternoon that the Scottish Parliament can be the first line of defence against Tory policies from Westminster.

He was due to launch an attack on Alex Salmond over remarks he made about Scotland's attitude to Thatcherite policies.

He was expected to say: "I remember the last time, the last recession, the last cuts, the last Tory government.

"When I heard that Alex Salmond had said 'Scotland didn't mind Thatcher's economics, it was just her social policy we didn't like', I wondered where the hell he had been in the 80s.

"Then I remembered. He was in the oil investment department of the Royal Bank of Scotland. Maybe there they didn't mind Thatcher's economics.

"But where I was, we did. I was teaching in a secondary school in Edinburgh, where Thatcher's economics drained all the hope and the energy and the youth out of kids, where they were told that their unemployment was a price worth paying, where they were taught society had no place for them, that they would never work, that they had no future.

"If you think Scotland didn't mind Thatcher's economics, you don't understand the Tories, you don't understand economics and you don't understand Scotland."

He will say the current economic situation was different because this time there was a Scottish Parliament.

"We created our parliament for the hard times, not the good times. It means we can say: you see what the Tories are doing to the NHS in England? We won't have that here. You see what the Tories are doing to the universities in England? We won't have that here. You see what the Tories are doing to council services in England? We won't have that here."