Budget 2012: Labour attack package 'for millionaires'

Labour leader Ed Miliband has said the Budget "failed the fairness test" by not prioritising help for millions of hard-pressed families.

Cutting the top rate of tax to 45p showed it was a "millionaire's Budget which squeezes the middle", he said.

Low and middle earners faced cuts in tax credits and child benefit while pensioners faced a tax increase.

Chancellor George Osborne said the wealthiest would pay five times more than before as a result of new taxes.

But Mr Miliband said the cut in the top rate of tax from the current rate of 50p would benefit the richest 1% of the population who needed help the least.

While more than 300,000 people would benefit from this tax cut, the number affected by the rise in stamp duty on house sales of more than £2m would be far smaller.

He said this and other announcements "marked the end" of the coalition's repeated slogan that in attempts to cut the deficit and promote economic recovery "we are all in it together".

'Fairness test'

He attacked what he said was "an unfair Budget built on economic failure", adding that it showed the coalition's "true colours" and was the "death knell" of Prime Minister David Cameron's project of promoting compassionate Conservatism.

"The fairness test for this Budget was whether the chancellor used every penny he could to help middle income families that are squeezed. He has failed that test.

"Wrong choices, wrong priorities, wrong values," he told MPs. "Out of touch. Same old Tories."

He also attacked the Lib Dems' support for the package, saying their leader Nick Clegg had been fooled into thinking this was a "Robin Hood Budget".

There was nothing in the Budget to help families with rising fuel prices or to help young people out of work while the freeze on age related allowances for pensioners was a "hidden" tax increase, he told MPs.

The government's economic strategy was not working, he argued, with borrowing set to be £150bn higher than the chancellor indicated last year and growth continuing to be weak.

In advance of the Budget, the opposition called for a cut in VAT and a one-off tax on bankers' bonuses to fund youth job schemes and affordable house building.