Brown survives no confidence vote

MPs have confidence in Brown’s pension handling

MPs have confidence in Brown’s pension handling

Gordon Brown has survived a Commons vote of no confidence, described as “opportunistic” by the chancellor.

Tabled by the Conservatives, the motion “this house has no confidence in the chancellor’s handling of pension benefits” was comfortably defeated by a majority of 65.

With a Labour majority of 67 there was little serious risk that Mr Brown would lose the vote, but the highly atypical move, and the first such vote of no confidence tabled against the chancellor, is seen to have embarrassed him at an already difficult time.

The shadow chancellor George Osborne accused Mr Brown of “acting with stealth” and disregard to his civil servants’ advice, with the result that he depleted the pension funds of 125,000 people.

Mr Brown maintained he had made the “right decision for the country” and had helped the economy prosper, and went on to carry the house by 298 MPs to 233.

In abolishing tax relief on occupational pensions in 1997, Mr Osborne said Mr Brown had introduced a stealth tax on pensions, which had “blown a big hole” in pension funds leading to “large-scale desolation” of the pension system.

This has caused shortfalls for “millions” and left 125,000 people with little or no funds, he argued.

Mr Osborne continued: “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 that he has brought to Britain’s pensions.”

Furthermore, Mr Brown has never shown “any expression of sympathy” for those whose funds he “raided”.

But Mr Brown countered that the Conservatives lacked policies and were now acting with “short-termism” and “opportunism”.

Rebutting Mr Osborne’s arguments, the chancellor said: “We take the long-term decisions for the economy. He has a short-term approach.”

“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.”

Occupational pension holders are now protected by safeguards introduced by the Labour government, he continued.

The Liberal Democrats backed the no confidence motion. Lib Dem economic spokesman Vince Cable maintained that the government had made a mistake in 1997 and should now acknowledge it.

The Conservatives plan to table an amendment to the pensions bill, which returns to the Commons today and is designed to compensate those who lost pensions in 1997.

Calling for cross-party action on pensions, the Lib Dems said they would back the amendments.

Work and pensions spokesman David Laws said: “The government has consistently been found to be guilty of maladministration, yet it has had to be dragged kicking and screaming towards a proper package of compensation.

“This week MPs have their best opportunity to date to end this long-running farce. Those who have lost their pensions will not forgive MPs who do not back a fair compensation package.”