Council Tax Causing Fall In Disposable Income - Cable

12.01.00am BST (GMT +0100) Mon 8th Oct 2007

Commenting on the U-Switch report published today [Monday] showing that UK disposable income is at its lowest level for 10 years, Liberal Democrat Shadow Chancellor and Deputy Leader, Vince Cable MP said: "This very powerful report confirms that despite the general increase in household incomes over the last decade, many people are struggling to make ends meet because of rapidly rising costs and government taxation.

"Council Tax in particular has made a big hole in family finances across the country. Because it is unrelated to people's ability to pay, it is making very deep inroads into family finances.

"This report also shows that the conventional index used to measure inflation and set interest rates is seriously flawed, in particular failing to capture housing costs.

"It is particularly worrying that some groups, such as nurses and the armed forces, have fallen behind in salary levels. The Government is now faced with the dilemma of how to redress this problem within a very tight public spending round."