Brown dogged by domestic concerns

Controversial tax changes have threatened to overshadow the Prime Minister's visit to the United States.

Gordon Brown's three day official visit has been eclipsed in the US by the presence of the Pope, while at home the focus has been on the row over his plans to scrap the 10p tax rate.

He had to break off during his visit to meet President George Bush at the White House to take a telephone call from Labour MP Angela Smith to persuade her not to resign as a ministerial aide over the issue.

The Government has moved to head off a growing rebellion.

A senior Treasury source insisted that Chancellor Alistair Darling was aware of MPs' concerns about the change, which could leave five million low-paid families worse off, but added that there was no short-term solution.

The source said Treasury officials were looking at what could be done, but the Chancellor would not be able to "pull a rabbit out of a hat" and added "it will have to be a long-term solution".

On Friday evening, three more ministerial aides voiced concerns over the abolition of the lower tax rate.

Jeff Ennis, aide to Cabinet Office Minister Ed Miliband - one of Mr Brown's closest allies - said "everybody has concerns" over the decision, which experts claim will leave up to five million households worse off.

Mr Ennis ruled out voting against the Government over the issue or resigning from his Parliamentary Private Secretary (PPS) post, but called for targeted support to help those affected by the decision.

Celia Barlow, aide to Science Minister Ian Pearson, has written to Mr Brown about the issue and Dave Anderson, PPS to Higher Education Minister Bill Rammell said "we are doing the wrong thing here".

There is growing unease within Labour ranks about the tax change, which was announced in Mr Brown's final Budget last year and came into force earlier this month.

More than 70 Labour MPs have signed one of three Commons motions calling for action on the abolition of the 10p rate.

The Finance Bill enacting changes in this year's Budget is still before Parliament, providing a focus for a rebellion.

Former welfare reform minister Frank Field has warned Mr Brown faces a "mutiny" in a vote due when the Commons returns from recess next week and urged ministers to "make concessions".

In an interview this morning, Mr Brown said the tax change was part of a "wider package" of reforms.

"We've raised child benefits for seven million mothers and families in this country.

"We're raising the child tax-credit, we're raising the pensioners' winter allowance, we're raising the pensioners' tax-credit.

"It's all part of a wider package where we're taking the 10p rate to put the basic rate down from 22p to 20p.

"And I think, as people understand that we're taking more people out of poverty, we're helping low-income families more.

"Middle income Britain does well out of this. I think they'll understand that these are the right decisions for the British people."

Meanwhile, speaking on the final day of his US visit, Mr Brown has urged Europe and the US to work together to overhaul the post-Second World War structures of the United Nations, the International Monetary Fund and the World Bank.

During his visit, Mr Brown met the three leading contenders to succeed him - John McCain, Barack Obama and Hillary Clinton - and his speech was pitched as a direct appeal to them to take up the cause.

"American leadership is and will be indispensable," he said.

"And now is an opportunity for an historic effort in co-operation; a new dawn in collaborative action between America and Europe - a new commitment from Europe that I believe all European leaders can work with America to forge stronger transatlantic links.

"For I sense common ground between our two great continents in the urgent need for renewal and reform."

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