Unveiling Labour’s battle plan to fight the general election, Prime Minister Gordon Brown pledged not raise income tax in the next parliament, but refused to rule out a rise in VAT.
The manifesto contained reheated commitments to Crossrail, a third Heathrow runway and the phased construction of a high speed rail line linking the south and north.
The manifesto carries a sting in the tail for all utility firms, promising tenfold hikes in fines for utility work over-runs.
Labour also says it will take a decision early in the next parliament on proposals for a multi-billion pounds tidal energy scheme along the Severn River.
But Brown failed to quash fears that Labour will seek VAT rises in a fourth term
Labour says it will not to extend VAT to food, children’s clothes, books, newspapers and public transport fares – although it does not commit not to raise VAT elsewhere.
Asked for a firmer commitment to rule out a rise in VAT, Mr Brown said: “We have not raised VAT since 1997, the only party that has raised VAT in the last 25 years is the Conservative Party.”
Labour promised not to raise income tax in its 2005 manifesto, but went on to introduce a new 50p tax rate for incomes over £150,000.
The manifesto proposes new measures to tackle lasting effects of the banking crisis. These include a pledge to establish an independent Business Credit Adjudicator, granted powers to ensure small and medium businesses are not turned down unfairly when applying for bank credit.
Brown’s election campaign message: “plan for the future” underlined Labour’s drive to introduce a Green investment bank to deliver low carbon technologies.
But he failed to meet the construction industry’s call to cut carbon emissions from large-scale improvements to the existing housing stock.
“Our industrial strategy will ensure that the drive to green our economy will create jobs and businesses in Britain in the manufacture and installation of low-carbon and environmental technologies,” states the election manifesto.
Among a raft of housing pledges there are plans to extend home ownership to people on lower incomes.
Labour says it will reform the council house financing system to enable local authorities to maintain properties at the Decent Home standard and to build up to 10,000 council houses a year by the end of the next Parliament.
It says that it will ‘make savings in regeneration funding and focus on tackling worklessness, transforming the prospects of those areas most disconnected from the wider economy’.
It says it will expand design standards that it introduced for schools to ensure high quality building design ‘to all new government-funded building programmes’.