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Say sorry on pensions, Brown told Win for Brown in confidence vote
(about 5 hours later)
Chancellor Gordon Brown has been urged to "say sorry" for his 1997 decision to scrap tax relief on pensions, during a stormy debate in the Commons. Chancellor Gordon Brown has beaten off a Conservative call for a vote of no confidence over his 1997 decision to scrap tax relief on pensions.
Shadow chancellor George Osborne has tabled a no-confidence vote in Mr Brown over the issue. Shadow chancellor George Osborne, who tabled the motion, accused Mr Brown of "acting with stealth" and hitting the pensions of 125,000 people.
Mr Osborne told MPs Mr Brown had "acted with stealth", hitting 125,000 people's pensions, and urged him to apologise. But MPs voted by a majority of 65 against the Tory proposal.
Amid loud shouting, the chancellor refused to do so and said he had taken the correct "long-term decisions". Mr Brown said the changes to pensions had made "the right decision for the country" and helped the economy.
It is highly unusual for opposition parties to call for motions of no confidence on individual ministers.It is highly unusual for opposition parties to call for motions of no confidence on individual ministers.
'Destruction' 'Blames everyone'
Even if, as expected, they lose the vote, the Tories will hope the debate embarrasses Mr Brown, the firm favourite to succeed Tony Blair as prime minister. Despite losing the vote by 298 to 233, the Tories will hope the debate will embarrass Mr Brown, the firm favourite to succeed Tony Blair as prime minister.
The government's current Commons majority is 67.
A recent release of Treasury documents under the Freedom of Information Act led to claims that the chancellor had ignored the advice of officials when he abolished tax relief on pensions. The Treasury denies the claim.A recent release of Treasury documents under the Freedom of Information Act led to claims that the chancellor had ignored the advice of officials when he abolished tax relief on pensions. The Treasury denies the claim.
The arguments have been well rehearsed over the past few weeks, even years, but shadow chancellor George Osborne was not going to let that stop him BBC's Nick Assinder Analysis of debateThe arguments have been well rehearsed over the past few weeks, even years, but shadow chancellor George Osborne was not going to let that stop him BBC's Nick Assinder Analysis of debate
The Conservative motion reads: "This House has no confidence in this chancellor's handling of pension benefits." The Conservative motion read: "This House has no confidence in this chancellor's handling of pension benefits."
In a lively Commons, Mr Osborne said: "This chancellor has from the start acted with stealth, blocked all attempts to get at the truth and now blames everyone but himself for the destruction he has brought to Britain's pensions. Amid a lively Commons atmosphere, Mr Osborne said: "This chancellor has from the start acted with stealth, blocked all attempts to get at the truth and now blames everyone but himself for the destruction he has brought to Britain's pensions.
"In short, the abolition of dividend tax credits was in the words of the prime minister's own economic adviser at the time, a mad thing to do, quite crackers.""In short, the abolition of dividend tax credits was in the words of the prime minister's own economic adviser at the time, a mad thing to do, quite crackers."
He added that Mr Brown had never shown "any expression of sympathy" for those whose funds had been "raided".He added that Mr Brown had never shown "any expression of sympathy" for those whose funds had been "raided".
The government help given so far had been "inadequate" for the "big hole" it had created, Mr Osborne said.The government help given so far had been "inadequate" for the "big hole" it had created, Mr Osborne said.
CompetitivenessCompetitiveness
Mr Brown said the Tories had "no alternative to the policy we put forward" and accused Mr Osborne of "short-termism" and "opportunism".Mr Brown said the Tories had "no alternative to the policy we put forward" and accused Mr Osborne of "short-termism" and "opportunism".
He added: "We take the long-term decisions for the economy. He has a short-term approach."He added: "We take the long-term decisions for the economy. He has a short-term approach."
Mr Brown also said the Labour government had introduced safeguards for holders of occupational pensions whose companies go bust.Mr Brown also said the Labour government had introduced safeguards for holders of occupational pensions whose companies go bust.
He added: "The strength of our argument is ... upon the rock of theeconomy and making the long term decisions that are the right decision for the country. He added: "The strength of our argument is ... upon the rock of the economy and making the long term decisions that are the right decision for the country.
"It is upon the rock of the economy that occupational pensions and any other services depend in our country."It is upon the rock of the economy that occupational pensions and any other services depend in our country.
Liberal Democrat Treasury spokesman Vincent Cable said: "We think the government made a mistake and we think they should acknowledge it."Liberal Democrat Treasury spokesman Vincent Cable said: "We think the government made a mistake and we think they should acknowledge it."
He added: "The government clearly judged that the should raise taxes in '97...He added: "The government clearly judged that the should raise taxes in '97...
"If the government needed to raise taxes, they should have done it openly.""If the government needed to raise taxes, they should have done it openly."
Mr Cable said his party would support the no-confidence motion. His party supported the no-confidence motion.
Economic Secretary to the Treasury Ed Balls, who was the chancellor's closest adviser in 1997, has defended the decision to abolish the relief for pension funds as part of the package of business tax reforms designed to improve competitiveness.
The Conservatives earlier said they would be tabling an amendment to the government's Pensions Bill when it returns to the Commons on Wednesday to help those who have lost occupational pensions since 1997.The Conservatives earlier said they would be tabling an amendment to the government's Pensions Bill when it returns to the Commons on Wednesday to help those who have lost occupational pensions since 1997.
Mr Brown has previously said his pensions decisions had raised £5bn a year from pension funds and had been a key reason the UK economy had been strong for the past decade. Mr Brown says said his pensions decisions have raised £5bn a year and had been a key reason the UK economy had been strong for the past decade.
It is the first time Mr Osborne and Mr Brown have gone head-to-head in the Commons on the subject of pensions since the row over advice given to the chancellor erupted earlier this month.It is the first time Mr Osborne and Mr Brown have gone head-to-head in the Commons on the subject of pensions since the row over advice given to the chancellor erupted earlier this month.