Tory praises Lib Dems for staying in the coalition

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A senior Conservative MP has praised the Liberal Democrats for staying the course and not collapsing the coalition in the face of difficult decisions.

Andrew Tyrie said "many" thought the coalition would buckle under the "political strain" of spending cuts, but the deficit reduction plan had instead become "the cement of the coalition".

He told the Commons: "I think both sides of the coalition deserve credit for the fact they are still going and dealing with the deficit and I think particular credit goes to the Liberal Democrats for having done so. If I may say so... I never thought they had it in them, but they have."

Mr Tyrie, the chair of the Treasury Select Committee, was leading the first of four days' debate on the 2014 Budget, in which Chancellor George Osborne had earlier unveiled support for savers and pensioners.

Fiscal targets

It was announced cash and shares Isas will be merged into a single New Isa with annual tax-free savings limit of £15,000, which Mr Tyrie hailed as a "tremendous idea".

The Chichester MP also welcomed the decision to remove tax restrictions on pensioners' access to their pension pots, thereby ending the requirement to buy an annuity.

Mark Hoban, a former coalition Treasury minister, said the government could go even further, and give young people advice about retirement savings while they are still working.

Labour MP and former whip Nick Brown challenged the government's view that "we are all in it together" in the efforts to cut the budget deficit.

He said income equality had "increased substantially over the last 40 years". The Newcastle East MP also told the Commons that the north east was not feeling the benefits of the economic recovery.

Labour Co-operative MP Meg Hiller felt the budget lacked measures to build more affordable homes, while Luciana Berger, also Labour Co-operative, said she wanted to see more help for young people trying to find work.

Liberal Democrat Ian Swales told the Commons his party was "proud" that its manifesto commitment to raise to £10,000 the amount that people can earn before paying tax had been met, and extended by a further £500 from 2015.

The Redcar MP also welcomed cuts in duty on beer and fuel, while his party colleague Lorely Burt commented that the scrapping of the duty escalator for wine would help the "suffering" industry.

Stewart Hosie, the SNP's finance spokesman at Westminster, supported "one-off" budget measures, such as the halving of bingo duty and the increased personal tax allowance.

But he attacked the government's general "direction of travel" and accused ministers of trying to "balance the books on the back of the poor".

The Dundee East MP went on to criticise Mr Osborne for meeting "not one" of the fiscal measure he set for himself in his first budget in 2010, noting that UK debt will not begin to fall as a share of GDP until 2016-17, which he said was two years later than planned.

Watch the continuation of the budget debate.

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