Darling Promises Recession Help
The chancellor has pledged to provide support to help people through the economic downturn amid expectations that he will use the pre-Budget report to cut VAT by 2.5 per cent.Alistair Darling is expected to announce a temporary reduction from 17.5 per cent to 15 per cent in value added tax levied on goods and services.
The plan, designed to encourage consumer spending and kick-start the economy, would cost £12.5bn.
It comes as part of a package of measures which could see a "fiscal stimulus" of £15bn to £20bn pumped into the economy.
Writing in the Sunday Mirror, Darling said: "Every household will get support now - to help them through the difficult period ahead.
"Worried mortgage holders will get help and I shall do what I can to help those who lose their jobs. And I will state exactly how we intend to pay for the help we are providing now."
He acknowledged that Britain was "moving into a recession" but insisted the difficulties could be overcome.
"I will not play down the economic difficulties but equally I am confident that with sensible and responsible measures they can be overcome," he said.
Writing in the News of the World, Gordon Brown stressed the need for urgent action, saying: "If we do not act now, the downturn will be longer and more severe."
He told BBC1's The Politics Show that action was "necessary and responsible".
Brown said the measures would need to be "substantial" to help tackle the downturn, criticising the Conservative approach of the 1980s and 1990s.
"Those people who say do nothing now would leave people, as in the '80s and the 90s, without hope that their mortgage problems could be sorted out, or their jobs problems could be sorted out," he said.
"It would be lacking in compassion as well as irresponsible, in my view."
Insisting the government "have a long-term plan", he added: "What you will see tomorrow is a concerted and co-ordinated programme of action, a plan of action right across the board, not just one item, not just one initiative."
The prime minister also said that world leaders agreed the need for an injection of cash into the economy.
"Everybody generally agrees that the fiscal stimulus - and what we mean by fiscal stimulus is real help for businesses and families now - has got to be substantial to have an impact," he said.
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