THE Government wooed and won former Tory voters in so-called Middle England with its pledges not to raise income tax.

But now it risks a swift divorce from hundreds of thousands of them with a surprise tax raid on their savings.

For in launching its new Individual Savings Accounts to offer an easy, tax-free savings scheme for the millions on low incomes who do not put anything by for the future, it is set to punish the prudence of the middle classes who already do so.

That is because the ISAs will, in two years' time, replace the popular tax-exempt Tessa and Pep schemes introduced by the Conservatives.

Those with more than £50,000 in their accounts will be hit by a retrospective income and capital gains tax bill.

Up to a million stand to suffer.

The notion, of course, is that anyone with at least £50,000 saved is well-off and can afford to pay the tax charge.

But are they really that rich?

After all, many of the nest eggs being built up in Tessas and Peps - at state behest, remember - are laudable and sensible self-help provision for retirement and, as such, would exclude millions of hard-working people who have never been a burden on the state from becoming so in their later years.

It is harsh, then, for the provident middle classes to be hammered for having done what the government is now encouraging the lower income groups to do through the ISAs - namely, standing on their own two feet.

This is particularly so when self-reliance needs to be encouraged across the board as the demographic time-bomb of an increasing ageing population exerts ever-rising pressure on the welfare state and its affordability.

Encouraging more people to save for the future is fine, but hammering those who have already done so will lose the government more support than it gains - particularly in Middle England where this will be seen as a back-door tax rise and a broken pledge.

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.