VAT increase will hit hard

The planned rise in VAT is the “wrong tax, at the wrong time”, Labour leader Ed Miliband is to warn. Speaking ahead of Tuesday’s VAT increase from 17.5% to 20%, Mr Miliband will claim it will cost the average family £7.50 a week. He will say the rise, considered but rejected by Labour, will hit “living standards, small businesses and jobs”. But the Conservatives say Labour’s plans for the economy would cost businesses billions of pounds. The government hopes the VAT increase will raise £13bn and insists it is necessary to help reduce the UK’s deficit. The Labour leader is set to issue his warning on Monday during a visit to the constituency of Oldham East and Saddleworth, where a by-election is to take place on 13 January. He will say the VAT rise on most goods and services will hinder economic growth, cost thousands of jobs and make it even harder for families to make ends meet when they are already feeling squeezed. “Today we start to see the Tory-led agenda move from Downing Street to your street,” Mr Miliband will warn. – BBC

The shameless Chancellor jetted off on a luxury skiing holiday – leaving Britain to suffer the backlash of his vicious policies. He went on the piste as struggling families faced huge rises in fuel duties, rail fares and VAT. That’s not to mention benefit reductions, pay cuts, job losses and the rise in university tuition fees. Last night furious union chiefs said the top Tory’s latest jaunt made a mockery of his claim that “we’re all in this together”. Millionaire Mr Osborne is staying with wife Frances and their two children at a trendy boutique hotel in the Swiss resort of Klosters. They have enjoyed almost a week of fun on the slopes – just before the Coalition’s stinging 2.5% VAT hike hits the high street. – The Mirror

Hundreds of poor families and young people may miss out on emergency welfare assistance for essential items such as beds for children, cookers and fridges because of this week’s VAT increase, charities warn. People in urgent need of specific household items – for instance those who have had to move swiftly to escape domestic violence, or who have lost their belongings in a house fire – can apply to charitable organisations for small, quickly delivered sums to meet their most pressing needs when they have exhausted state help. But charities warned of a “perfect storm” as the rise in the VAT rate from 17.5% to 20% on Tuesday increases prices and cuts the number of grants awarding bodies can make – at a time when applications are rising and funds dwindling because the interest earned on charities’ investments has plummeted. – Guardian

Campaign kicks on in Oldham East

Campaigning will get under way in earnest this week in the Oldham East and Saddleworth by-election, the first big test of public opinion since the creation of the coalition government. Both Nick Clegg and Ed Miliband will pay their second visits to the constituency, which Labour won last year with a majority of just 103 over the Liberal Democrats. David Cameron, who has faced accusations he secretly wants his coalition partners to win the contest on 13 January, is also due to visit this week. In a sign of Liberal Democrat anxiety about their prospects, their former leader, Charles Kennedy, deputy leader, Simon Hughes, president, Tim Farron, and several ministers will also bang the drum for the party. Mr Miliband will say during a visit today: “The battle in Oldham and across the country is about Labour and this Conservative-led government. “It may be a three-way fight for Oldham East and Saddleworth between Labour, the Liberal Democrats and the Tories. But it’s only a two-way fight about the direction for the country.” – Independent

Teachers warning over free schools

Teachers’ leaders say a survey shows that new free schools being opened in England are not wanted or needed. Three quarters of the 1,000 parents questioned for the National Union of Teachers (NUT) were unaware that a free school was planned for their area. The schools – being set up by groups of parents, charities and faith bodies – will be funded directly by Westminster. The government says the NUT is “blindly opposed” to the schools, which it argues will drive up standards. The NUT is campaigning against free schools – and the conversion of existing schools to academy status. Both types of school will be what the government calls independent state schools and will stand outside local authority control, with more freedom over the curriculum and teachers’ pay and conditions. Teachers employed by them will also not need to have formal teaching qualifications. – BBC

Oh Maggie

Which politician will dominate 2011? The obvious and easy answer is David Cameron. Sorry, Dave, but this may not be the whole truth. There is a less comfortable contender. If you extend the idea of “dominate” to ask which politician really inspires and divides, haunts and challenges, then there is surely another contender. It isn’t Nick. It isn’t Ed. And it isn’t even Barack Obama. She began the year by making headlines. The rule that allows the public release of Downing Street files 30 years after they were written has just reminded us of the vintage Thatcher style – pungent, vivid, angry and decisive. Read the decades-old documents: there she is, scrawling “No!” in her felt-tip pen across ministerial proposals, or “too woolly”, or simply “Never!”. She’s thumping Europeans and handbagging civil servants, including the governor of the Bank of England. Her first chancellor, Geoffrey Howe, has gone down in economic history as one of the fiercest, even most reckless, ever: but she told him he was not nearly tough enough. Old now, and ill, her memory flickering, Thatcher still dominates the Conservative party’s imagination. Cameron, who began in politics in her shadow, initially tried to shrug her off, proclaiming his belief that there was such a thing as society, and struggling to decontaminate “the nasty party”. But after Gordon Brown invited her to No 10, Cameron gave in and now makes regular obeisance to her cult. Tory rebels, who still regard Cameron as a fake and a betrayer, see Thatcher as their spiritual leader. – Guardian

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