Wasteful VAT cut only benefiting the rich

9.52.00pm BST (GMT +0100) Sun 12th Apr 2009

The Government's VAT cut is benefiting the richest households the most, figures highlighted by the Liberal Democrats have revealed. The richest households will save around £1.2bn from the Government's VAT cut, while the poorest 10% will only save an estimated £360m. Said Chelmsford Lib Dem Candidate Stephen Robinson, "This just confirms that the tiny VAT cut was a waste of our money."

"Most of the money is not helping the poorer households that are struggling in the recession. The money should be spent on transport and environmental projects which would boost the economy, create new jobs and leave a lasting green legacy for Britain."

The savings work out at an average of over £9 a week for the richest households, while poorer households are saving less than £3, despite recent claims from Gordon Brown that families would save at least £5 a week.

Pensioners are among the worst hit by the cut, with the poorest households saving only £2 a week while the richest save almost £7.