Labour accuses George Osborne of being 'in hock' to tax-dodging big businesses

The party’s billboard posters attack the Tories’ deals with big business and pledge to 'stand up' to cuts, not 'stand by'

In one poster, George Osborne is mocked up driving a Google-branded dodgem car

Jeremy Corbyn will kick off Labour’s local election campaign with posters accusing George Osborne of being “in hock” to big businesses that dodge tax.

A series of billboard-style adverts attack the Chancellor for failing to raise more tax from Google. Last week the social networking site Facebook voluntarily agreed to pay more tax in the UK, piling pressure on other US tech giants to follow suit.

Mr Osborne sparked widespread criticism in January after hailing a deal in which Google agreed to pay £130m in back taxes dating to 2005. Critics attacked the settlement as “derisory”, claiming the company was in effect paying a corporation tax rate of just 2.7 per cent.

In one of the new Labour posters published online, Mr Osborne is mocked up sitting in a special Google-branded dodgem car under the slogan: “Roll up, roll up to the unfair.” The poster says the Tories “don’t seem to understand fair tax contributions” before adding: “Perhaps they should Google it.”

Labour claims the poster “highlights the unfairness of George’s Osborne’s approach to tax avoidance – secret deals with large corporations while millions pay more”. A source said it was “an example of how the Tories are in hock to vested interests and are letting working people down”.

The poster campaign features Labour’s new slogan “standing up, not standing by”, which has divided opinion in Westminster. Speaking on 5 March, Mr Corbyn said the local and devolved elections on 5 May were a chance to vote for a party that will “stand up for you” against government cuts.

The poster campaign features Labour’s new slogan “standing up, not standing by”, which has divided opinion in Westminster

The nationwide elections are Mr Corbyn’s first real election test – with critics waiting to pounce if the party performs badly. The election experts Rawlings and Thrasher have said Labour could lose 200 seats this May – a disastrous result which could spark Mr Corbyn’s first real leadership challenge. To stand any chance of winning power in 2020 Labour needs to pick up around 300 townhall seats, pollsters say.

Excluding general election years, over the past 40 years the main opposition party has always gained seats. In 1982, a divided Labour lost 225 seats – but the Conservatives lost 98 seats despite winning support for the Falklands War. In 1985 Labour lost 124 seats. However, the Tories did even worse – losing 202 seats.

As well as being at risk of losing hundreds of council seats, Labour also faces losing overall control in Wales and failing to win a single constituency seat in Scotland. However, the party’s candidate in London, Sadiq Khan, is seen as the favourite to succeed Boris Johnson as mayor.

Jeremy Corbyn has said Labour will stand up for working people (Getty) (Getty Images)

Sources close to Mr Corbyn insist it will be hard for Labour to limit council election losses because they will be defending seats won four years ago at the height of public anger over Tory cuts.

Mr Corbyn told The Independent on Sunday that the elections were a chance to reject the “damaging choices the Tories are making”.

“Deep Tory cuts are putting the public services we rely on at risk, with thousands of police officers axed and the NHS going backwards, with longer waits and financial crisis,” he said.

“Labour will … stand up for working people to build an economy which works for all – one where prosperity is shared, pay is fair and jobs are secure.

“We will stand up for families and individuals struggling to buy or rent a home, by delivering more and better housing. And we will stand up against the unfair Tory cuts to protect the vital public services we all rely on. We will protect the police from deep Tory cuts. And we will invest in the NHS to rescue it from Tory neglect.

“That’s the choice at this election: a Tory Government which is putting the living standards of millions of working families at risk, or a Labour Party that will stand up for you.”

Dan Jarvis sets out his stall

Labour backbencher Dan Jarvis will outline his economic ideas to the Demos think-tank this week in a move touted as the opening salvo of his bid to replace Jeremy Corbyn.

Many MPs think Mr Jarvis, a former soldier, has the best back story to help return Labour to power. He decided not to stand for the leadership last summer for family reasons: he has three young children and had recently remarried after his first wife died of cancer.

Senior Labour MPs said they have advised Mr Jarvis on the direction Labour could take under a more centrist leader. A source close to Mr Jarvis said: “Inevitably, the leadership is going to get talked about. He’ll be looking at the economic agenda Labour should be following.”

Mark Leftly