First Minister Rhodri Morgan said he was opposed to scrapping the 10p tax band, warning it could fall hardest on Wales.

During question time in the Senedd, he said "probably twice as many people'' would find they are better off when their pay packets arrive this month.

But the large number of Welsh workers close to the minimum wage would feel the pinch, he warned.

Losing the 10p rate would be "outweighed'' by child tax credits for parents, but lower earners without children would be worse off, he said.

Mr Morgan told AMs: "The loss of that starting tax band was an essential part of a good welfare to work scheme and that's the reason why I am not keen on it, while accepting obviously in the end it's the Treasury, it's the UK Government, that have got to make the figures add up rather than ourselves.

"Nevertheless I do think there's a differential impact in Wales because there probably are quite numbers, probably more than in England say, of people who will be adversely affected because of the number of people working close to the minimum wage.''