National Insurance row escalates

A row over National Insurance rises intensified after business leaders said Labour claims they had been "deceived" into backing Conservative plans were "patronising".

Chancellor Alistair Darling accused David Cameron of "peddling a deception" after 23 top bosses backed proposals to reverse the Government's National Insurance increases in an open letter published in The Daily Telegraph.

Business Secretary Lord Mandelson said the Conservative plans were a "cynical deception" that could not be achieved without increasing VAT.

But two of the letter's signatories hit back immediately, accusing the Government of a "tax on jobs". Next boss Simon Wolfson added: "The principle is a very simple one. It is a question of, do we pay for government profligacy through increased taxes or do we urge them to save money in a way that businesses have?"

The row continued to escalate when it was reported that seven of the business leaders either represented companies who had donated funds to the Conservatives or had given money to the party as individuals.

Other business groups then responded, issuing another open letter supporting the call for the NI rise to be ditched. The letter stated: "We applaud the decision by a number of Britain's most senior business leaders to take a public stand against the planned rise in National Insurance - which is a clear and unequivocal tax on jobs."