Labour Leader Helen Clark said today that the Prime Minister's desperate claim that Christine Fletcher or any other MP had made 'unacceptable demands' in exchange for supporting the National Party's proposed tax cuts was a complete fabrication.

"The Prime Minister's attempt to seize the moral high ground on this issue, by claiming that she would not pursue tax cuts 'at any cost', has been spectacularly unsuccessful, as there is not a shred of evidence that Christine Fletcher or Tuariki Delamere or Mr Grover presented Mrs Shipley with the 'unacceptable demands' she refers to. Once again Mrs Shipley appears to have made up a story under pressure.

"Mrs Fletcher, for example, has been quite emphatic on the subject: 'I made no specific requests'. Her letter to Mr English, tabled in Parliament today, makes that clear.

"Despite Mrs Shipley's traditional eagerness to pay almost any price if it means clinging to office, supported by an improbable array of people, on this occasion she was unable to prevail. The fact that she then resorted to fabricating claims about 'unacceptable demands' only confirms her desperation.

"Speaking on Mrs Shipley's behalf in Parliament today, Mr Creech claimed feebly that 'the Government was under no pressure on this issue'.

"The opposite is true, as Mrs Shipley, Mr Creech and their colleagues must surely realise. In failing to secure support from Mrs Fletcher and Mr Delamere for further tax cuts, the National Party has been stripped of the only campaigning tool it had - the tatty promise of a few extra dollars in voters' pockets. This can only increase the pressure on Mrs Shipley, as her rag-tag coalition limps towards the election.

"Rather than the 'carefully considered decision' Mr Creech depicts, National's failure to secure a deal on further tax cuts is a humiliating defeat which highlights the limits of the naked expediency and bankrupt policies National traditionally relies on," Helen Clark said.

Contact: Mark Watts (press secretary), 04 471 9477 or 025 822 734

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