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Help hardship victims, TUC urges Pressure for windfall tax mounts
(1 day later)
The government must do more to help people hit by the economic downturn and rising fuel bills or pay the price at the next election, the TUC has warned. The government faces mounting pressure to help those hit by high energy bills, with TUC leader Brendan Barber the latest to call for a windfall tax.
General secretary Brendan Barber said millions of households were already in recession and repeated his call for a windfall tax on energy firms' profits. Mr Barber warned Gordon Brown that further inaction would mean Labour paying the price at the next election.
The government had "got things wrong" in limiting public sector pay, he said. Millions of households were already in recession, he said, renewing calls for a one-off tax on power firms' profits.
At next week's TUC congress, Mr Barber is set to demand an end to the "yawning chasm" between rich and poor. This week the government ruled out one-off fuel payments to help those hit hardest by rising energy prices.
A statement on energy prices is expected next week, but it is thought a windfall tax will not be among the measures announced.
Refusal
Ministers were hoping to unveil a package of help with fuel bills, including payments of between £50 and £100 per head.
But after energy firms refused to help provide the cash, the focus is now being put on improving energy efficiency, rather than securing immediate savings.
With three quarters of us saying that the gap between the rich and poor is too wide, now is the time for decisive action, not cringe-making praise for the wealthy Brendan BarberTUC Analysis: TUC challenges
The government has denied "caving in" to the energy companies over cash rebates.
Environment secretary Hilary Benn said on Friday that talks were continuing over what "further contribution" energy companies could make.
But pressure remains on the government to act decisively. At next week's TUC congress, Mr Barber is set to demand an end to the "yawning chasm" between rich and poor.
He joins a growing chorus of Labour supporters who have condemned the government for failing poorer families.
On Friday Tony Woodley of Unite branded the decision to ditch plans for help with fuel bills as a "downright disgrace".
And on Saturday the Green Party called for a windfall tax on energy company profits.
The main reason why we are low in the polls is because people are facing difficult circumstances Harriet Harman, Deputy Prime Minister Darling set to face union chill
However, despite additional pressure from more than 120 Labour MPs who are believed to have backed calls for a windfall tax, most observers believe that the Treasury will stand firm.
One reason is thought to be the fear that any windfall tax imposed by the government will merely be passed onto consumers by energy firms in the form of higher bills.
'Toothless tiger'
BBC political correspondent Norman Smith said that the growing pressure from MPs, combined with Gordon Brown's vulnerable position, made it difficult for the Prime Minister to dismiss the idea completely - resulting in mixed messages.
"If you want to get energy companies to cough up, somehow you've got to get some sort of leverage and the windfall tax is a way to do it," our correspondent said.
"Instinctively and intellectually the chancellor, the prime minister and the business secretary are deeply sceptical about a windfall tax, but how else do you get pressure on the energy companies?
"You can appeal to their better nature but these are commercial global companies.
"They don't have to invest in Britain, so if you want to get leverage a windfall tax could be a good way to do it."
One Labour MP who supports the windfall tax, Lindsay Hoyle, told the BBC it was "not right" that people had real concerns for putting the heating on because of worries about their power bills.
He said that the energy watchdog Ofgem was a "toothless tiger" in controlling prices and that energy firms were making "immoral earnings".
"We've got to put a windfall tax in, we've got to get those prices down. We've got to use a stick against these greedy energy companies," he said.
'Greed''Greed'
Speaking ahead of the annual get-together in Brighton, which starts on Monday, he asked for the tax system to be reformed to help "ordinary people". The row over windfall taxes illustrates the growing dissatisfaction within the labour movement over the government's priorities.
Mr Barber did not say whether he wanted Gordon Brown to stand down as prime minister, but he warned that there could be further industrial action before the end of the year over public sector pay rises - which were set at a below-inflation rate last year. Speaking ahead of the TUC conference in Brighton, Mr Barber also asked for the tax system to be reformed to help "ordinary people".
In his opening address to the congress on Monday, Mr Barber will blame "greedy" bankers and higher world demand for oil for the credit crunch and will accuse governments of listening too much to big business. He also warned that there could be further industrial action before the end of the year over public sector pay rises - which were set at a below-inflation rate last year.
In his opening address on Monday, Mr Barber will blame "greedy" bankers and higher world demand for oil for the credit crunch and will accuse governments of listening too much to big business.
He will say: "It's not fair that employees are facing a fall in their living standards while top bosses see their pay packets go up by 20% or even 30%.He will say: "It's not fair that employees are facing a fall in their living standards while top bosses see their pay packets go up by 20% or even 30%.
'Too wide' Action
"It's not fair that workers pay more tax on their earnings than people who earn 100 or even 1,000 times more, and it's not fair that pensioners and low-income families are living in fear of a cold winter while energy companies post huge profits and speculators rake it in."
Mr Barber will say the next election will be about the economy, adding: "With three quarters of us saying that the gap between the rich and poor is too wide, now is the time for decisive action, not cringe-making praise for the wealthy."
He will urge the government to curb "greed" at the top and address "desperate conditions" at the bottom, claiming that two million workers face exploitation.
Ministers will be urged to change the tax system to stop the rich "getting away" with not paying their share, help vulnerable workers, and take more steps to build more affordable houses.
Calls for co-ordinated action are expected during the conference, led by civil servants' and teachers' unions.Calls for co-ordinated action are expected during the conference, led by civil servants' and teachers' unions.
With Gordon Brown's leadership coming under increasing criticism ahead of Labour's annual conference later this month, his deputy, Harriet Harman, has admitted that the government is suffering badly from the changing economic times.
"When people feel that their lives are more of a struggle than they used to be, then that expresses itself in dissatisfaction with the Government," she told The Times.
"The main reason why we are low in the polls is because people are facing difficult circumstances."