Major faces fresh revolt on fuel VAT

JOHN MAJOR'S fragile 14-seat majority may be at risk again next week, with up to a dozen Tory backbenchers threatening to join Labour in an attempt halt the doubling of VAT on fuel.

The second stage in the imposition of VAT, taking it to the full 17.5 per cent rate from April, was announced in last year's Budget. Government business managers had insisted that there could be no parliamentary vote this year. But Labour Party tacticians have found a way round the block, allowing Gordon Brown, the Shadow Chancellor, to table a procedural motion that could force a vote.

Two Tory MPs confirmed yesterday that they would not support the Government in any such vote. Phil Gallie, MP for Ayr, said: ``I shall not be supporting the Government in the lobbies on imposing the full 17.5 per cent.'' Sir Nicholas Fairbairn, MP for Perth and Kinross, last night promised to support ``any measure that stops this increase''. Other opponents of the VAT on fuel include William Powell (Corby), Nicholas Winterton (Macclesfield), Ann Winterton (Congleton), Richard Shepherd (Aldridge Brownhills), William Cash (Stafford), Teresa Gorman (Billericay), Paul Marland (Gloucestershire West) and Michael Lord (Suffolk Central).

``It is morally wrong that elderly people who have no opportunity of adjusting their income to take account of additional taxation should be treated in this way,'' Mr Winterton said. He was ``implacably opposed'' to the fuel tax rise and, if MPs were allowed to vote, he would restate his hostility.

Tory MPs campaigning for pensioners said they too may vote against the Government if the second stage of compensation for VAT on fuel is not generous enough.

Andrew Bowden, MP for Brighton Kemptown, said he is concerned that pensioners might be offered only an additional 25p a week next year, rather than the 50p he expected. He added: ``That is not acceptable and if that is the line down which the Government hopes to go, they cannot count on my support in the lobbies when this is discussed by Labour.'' In a motion on the same subject last year, Mr Bowden got backing from six Tories.

Conservative backbenchers believe that they failed to persuade the Chancellor, Kenneth Clarke, not to implement the rise in VAT on fuel. Some ministers have argued for the imposition of VAT on newspapers instead. But the Department of the Environment argues that the fuel VAT rise is needed to achieve international agreements to reduce pollution.

Labour's procedural move will come when the Chancellor proposes the Budget on 29 November. The Opposition will move an amendment to the resolution governing the conduct of debate on the Finance Bill. The Government usually insists that MPs vote on a Finance Bill as a whole, not on specific items. The amendment will try to overturn this ruling, so allowing a challenge specifically linked to the doubling of fuel VAT.

Andrew Smith, MP for Oxford East and a member of Labour's Treasury team, said: ``If the Government is determined to block the opportunity for the Commons even to consider this issue, there will be widespread public outrage and mounting discontent among Conservative backbenchers.''