Chancellor Gordon Brown today defended his controversial decision to scrap a tax break for pension funds in 1997 as the issue threatened to overshadow Labour’s Scottish Parliament election campaign.
The Chancellor was today backed by Prime Minister Tony Blair as he told a press conference in Glasgow the decision to axe dividend tax credits had been right for the country and the economy.
"I believe it was the right decision to make," said the Chancellor. "It was the right decision for investment, the right decision for the future of our pension system, and the right decision for the future of the economy."
And Tony Blair insisted: "It was the right decision then - and it is the right decision now."
The two men were speaking at a joint press conference in Glasgow in a bid to halt an SNP advance which could put the Nationalists in power in the May Scottish Parliament elections.
But their joint appearance was overshadowed by a controversy which began at the weekend when newly released documents showed Mr Brown was warned before his July 1997 Budget that the move to abolish the dividend tax credit could wipe billions from pension fund assets.
Mr Brown and Mr Blair, along with First Minister Jack McConnell were in Glasgow to launch a major economic assault on the SNP’s policies.
They claimed the SNP’s plans even on "generous" estimates of North Sea oil had at their heart a #12.9 billion deficit equivalent to more than #5,000 for every Scottish household.