A nice steady-as-she-goes budget with no real surprises. It fits the Tory narrative (and the Lib Dem one, I suppose) of a well-managed economy. The UK grew 2.6% in 2014, faster than any other advanced economy, there is record employment in the UK, with jobless rate to fall to 5.3% this year, trade deficit figures “the best for 15 years” and living standards “higher” than in May 2010, according to OBR data, with households better off by an average of £900 in last five years. Who would have thought, compared to ‘the mess’ the coalition inherited when they came to power, that the UK economy would look so rosy?
So, a few little tax giveaways, including the raising of income tax thresholds and, despite the fall in oil prices, a freeze on fuel duty. Richer pensioners, global multi-national companies and bankers are being squeezed but the Tories know that these groups fear a Labour government would do worse.
Osbourne must be very pleased with himself. Labour won’t be able to lay a glove on him for economic mismanagement. When the polls are close and a voter is in the booth about to place an ‘x’ in a box, the economy is often the first thing that springs to mind.
The polls are neck & neck. The prediction is for a hung parliament. However, people still have a reluctance to admit to an intention to vote Tory, so, with the economic trump card, my feeling is that the Tories will do better than the polls suggest at the moment.
Labour are going to have to come up with something special to swing things their way. I doubt they have the capability.
I’m expecting a hung parliament with Tories still with the largest number of seats and lots of noisy minority parties shouting into microphones on Parliament Square.
Lord help us.
How was The Budget for you?
Tell you what…
I moved back to Ireland in 2011 when the country was bankrupt, unemployment was rampant and austerity meant 30% public sector pay cuts and emergency tax levies. Still though, I never saw a food bank until I visited London last July. That blew my mind. The normalisation of it. You’re better than that.
Good post TL. I agree with you in thinking that the Tories will do better than the polls suggest. I remember the 1992 election clearly & the polls git it wrong & John Major was returned with a smallish majority.
I think Labour are devoid of inspiration (& I speak as a lifelong labour voter/ supporter), whereas the Tories have always been better at electioneering than Labour. The Tories were a basket case in 97 & were up against a young (ish) fresh faced, charismatic Tony Blair he carried that massive goodwill & approval through the 2001 election, winning another landslide.
By the time of the next election (2005) the shine had come of TB, we were fighting wars in far away lands & the Labour majority was still there, but greatly reduced. Gordon Brown took over & while I believe him to be a good man with a massive grasp of his subject, he was also a charisma free zone & I am convinced that it was him that lost the last election, seriously, if TB was still in office he would have wiped the floor with David Cameron.
And here we are. I have said this before, but I think that a lot of the population regard those on benefits as scroungers (NOT my view), & are not that bothered about the have nots.
I know I am being a bit simplistic here, but I genuinely think that as a nation/ population we are generally a more selfish society when the Tories are in power & I also know that OOAA.
So, the prediction from biscuit towers is a conservative win with a small overal majority of 10-20 seats – says the man who predicted a yes vote in Scotland. (in other words, WTF do i know?)
The Tories have clearly calculated that those on benefits, hit by the bedroom tax or repeatedly ‘sanctioned’ to such a degree they are dependent on food banks, can be electorally ignored. Worse than that, they believe the majority of voters perceive a ‘firmness’ on ‘scroungers’ as a good thing.
In the meantime, I struggle to think of a single bright Labour idea. I still don’t know what they are going to do for the NHS that is so much better. Still, the manifestos won’t be long in coming. I can hardly wait.
It was a good stab at an election budget. I think your election prediction is probably right (thanks to the resurgent nats). It’s worth noting though, that this would mean that it will have been nearly a quarter of a century since the Tories won a majority in a General Election. Or to put it another way, no-one under the age of 40 has voted in a Tory government. That strikes me as an interesting development.
That penny off a pint could save me up to 5p a week. I’d better invest it in an interest bearing account, now that I will no longer have to pay tax on the first grand earned.
Sadly, I agree with you. I think it’s the Tories to lose and with Scotland looking likely to go largely SNP the potential threat from Labour is diluted further. The right-wingers I know are reluctant to vote Tory (on social Conservative grounds and because they loose child benefit based one one large salary rather than keeping it on two, cumulatively higher, ones) and won’t go UKIP (no idea why, but I had no idea why they actually considered it in the first place, or why anyone would), the Lib Dems are toast as their former voters, including me on occasion, deride them as Cameron’s enablers, and few people have any enthusiasm for Ed Milliband, even though he was my preferred candidate for the Labour leadership.
That’s a horrible sentence I’ve just written, but it adds up to me saying damned if I know but I suspect whatever happens we’ll end up with more of the same.
That’s ‘Tories’ to lose’ not ‘Tories to lose’. Curse the absence of an edit function!
just to clarify a minor point – the £1000 allowance re tax free interest only applies to those earning below £15600.
Follow Nicola Sturgeon’s advice to the english. Vote Green. It’ll at least match the colour of the faces of establishment if you did.
(Will I? Probably not, but damned if I know who else. May have to resort to voting for the individual than the party, possibly not a bad idea generally, if you ever get allowed thru’ the propaganda to know)
The Greens being the party to who to effectively halt medical research? I’ll pass on that, I think. It makes them more reactionary than UKIP, IMO.
If Labour get in and do nothing for 5 years except repeal the bedroom tax inhumanity, halt NHS privatisation and reduce public spending cuts, it’ll still be much better than the alternative.
Trouble is whoever gets won’t stop themselves doing things.
Incidentally, I know a little about my local health economy. The biggest strain is the interest payments on PFI buildings put in place by Labour. Those are the worst ‘mortgages’ I have ever heard of, with enormous interest payments, way above the market rate, linked to maintenance contracts, also at ridiculously high rates, and at the end of the term the buildings belong to the banks and private companies that provided the loans. Amazing! All that taxpayer money that should be spent on services, pouring into private pockets. Labour could have arranged much cheaper loans, negotiated cheaper maintenance contracts and still obtained the facilities. I cannot think of a worse example of ‘privatisation’ in the health service.
Labour may hold the moral high ground over the NHS compared to the Tories but their hands are by no means clean and their promises so far in this election are unconvincing.
I don’t like PFI however it was a necessary evil to replace the creaking hospital and school infrastructure.
And whilst PFI was certainly heavily used by Labour it was actually initially developed under the Tories and just as eagerly defended by them. Had they been in power in the Blair years we would have seen at least as much and probably more such private sector mechanisms in education and health.
Maybe so. Gordon Brown’s enthusiasm for it was startling & they could easily have negotiated a better deal for the taxpayer. Besides, there were other means available to raise the cash that were much cheaper but those would have shown up on the government books. So, to keep ‘capital expenditure’ apparently low, they deliberately over-mortgaged the future. Necessary evil – no. Bad business for the sake of politicking – yes.
There are similar issues with drug companies. With a virtual monopoly on the market, it is shocking that the UK frequently pays more for drugs than the US and the rest of Europe. All that needs to happen is for the government to negotiate harder. Both parties are very poor in this respect.
Not just ‘politicking’. They anxious to avoid the fate of the Wilson government and be blown off course by a ‘run on the pound’. there are a heck of a lot of good schools around here, thanks to PFI.
Lovely buildings, aren’t they? Pity they have to cut back on staff to keep up with the extortionate interest payments. Special Needs teaching is being particularly hit. No doubt, you will claim this is due to ‘Tory cuts’, whereas a Special Needs Teacher I know is quite clear, it’s the PFI payments.
The brand new hospital has to find £5million every year out of its budget that would otherwise be spent on clinical activity. That doesn’t include the stupid maintenance contract (£120 to change a light bulb, anyone?)
When they agreed to these arrangements, Labour knew exactly what they were doing. They knew the interest payment grind would crank up over time. I remain bewildered why they didn’t say to the private companies trousersing this cash, “you’re having a laugh, you can have double the going rate”, rather than giving them ten times as much! Those companies would still have built the buildings because double the going rate would have been an excellent investment any way.
On the other hand, running costs are covered. swings/roundabouts etc.
No. They are in a seperate contract linked to the PFI. Again, fees are way above the market rate. The actual running costs should be far less costly.
PFI means the private companies build the buildings and loan them out to the government at massive rates of interest. Linked, is a ridiculous service cost that charges way above the usual. After the term, the payments amount to many times the actual cost of the building but it still belongs to the firms that built it!
When this government came in, they were alarmed at the costs, money pouring into private hands for doing very little. They threatended to renegotiate the terms but didn’t have the balls to do so in the end.
Whenever, anyone talks about ‘privatisation’ of the health service, I bristle about PFI, the worst example of public funds draining into private hands for very little. The argument that we wouldn’t have had the buildings otherwise simply doesn’t stand up to scrutiny. The government could have arranged far cheaper capital loans & service contracts. They chose not to.
Why would they *choose* not to? leaving aside the fact that it wouldn’t be politicians who did the negotiating anyway.
Look, I’m not necessarily a fan of PFI, in principle. However there’s no doubt that our debt position – and therefore our ability to weather the worldwide financial crisis – would have been worse if the building programme had all been capital spend.
Why, when given the opportunity do they not make the tax laws simpler rather than more complicated? I’ve read three explanations about how tax on savings is going to work and I’m still unclear how it works. Why not just scrap the tax altogether and gather it in somewhere else? Complications lead to loopholes which lead to bad feeling.
Does it matter? I don’t know anyone earning a thousand pounds on interest per year.
£1000 is only 1% of £100,000 so I’d be a bit disappointed if I’m not getting at least that.
And anyway, I may be subject to the lower (£500) threshold and that’s the bit that seems confusing from what I’ve read.
*Jaw drops*
A lot of our savings should have been squirelled into pension funds but we’re both rubbish at making long term financial decisions so it wasn’t which explains why we have what’s probably quite a high pot in bank and building society accounts.
Most people with a total income of less than £15,600 will not pay any tax on their savings. If someone’s total income (such as wages, pension, benefits and savings income) is less than their personal allowance, plus £5,000, they will be able to register for tax-free savings with their bank or building society.
Other people can also benefit, and have some of their interest eligible for the 0% starting rate – but only if their income (other than interest or other savings income) is less than £15,600 a year.
It’s won’t be as straight forward as that though when the new rules kick in because for lower incomes (up to about £45,000 I think) will pay no tax on interest up to £1000. Others will only get £500 tax free but I can’t work out where the thresholds actually are…. but that’s not really my original point. It’s that they’ve introduced a new system that’s immediately confusing and more complex than it might be. Where thresholds exist, people fiddle around to try to stay below them, especially where the consequences aren’t on a sliding scale. That’s what happens with stamp duty on property.
Don’t quite follow you – if you earn over £15600 then all your interest will be taxed as it is now,ie 20% will be deducted at source.
If you’re a higher rate taxpayer then there’ll be an additional liability at the end of the tax year – again, exactly the same as now.
https://www.gov.uk/government/publications/issue-briefing-starting-tax-rate-for-savings-interest/issue-briefing-starting-tax-rate-for-savings-interest
According to the BBC website, one of the key points of yesterday’s budget was:
New personal savings allowance – first £1,000 interest on savings income to be tax-free for basic rate taxpayers and £500 allowance for 40p tax ratepayers.
That seems straightforward but other newspapers seem to suggest it’s more complicated than that.
Being chancellor is a bit like being a two-year-old with a Fisher Price playset. There’s buttons you can hit and knobs to turn, and a couple of things that go ‘bing!’, but you can’t really achieve much with it except piss people off. The stuff that’s going to burn us in the future is way beyond Osborne’s control – resource scarcity, a growing and ageing global population, climate change, wars, and the fact that too many countries do business better than us and with a lower overhead.
If the Faux Horseman of the Apocalypse were here he’d no doubt point to the £900m rise in the bank rate versus the £12bn in welfare cuts and conclude that the bankers are laughing all the way to – well, everywhere. And he’d be right – the wrong people are going to suffer most. But ‘Tax the rich to feed the poor’ always looks better graffitied on an underpass than it does on a Finance Bill, and it’s hard to imagine any other party with a whiff of Downing Street in their nostrils doing much different. Gotta keep feeding the shark that shits jobs and tax.
It’s hard not to conclude that George has done just enough to persuade enough voters that they should put their own wealth and security above those with less than them – which says as much about the electorate as it does about the people we elect.
I’ll never stop saying it. Labour are a disgrace. Tory-lite policies with the same basic Neo Lib Global Free Market agenda as the other two main parties. They do not properly represent the interests of working people. This is a veneer. Larry Cameron, Mo Miliband and Curly Clegg are the three EU corporate stooges. Fully paid up members of the elite club, and they certainly don’t give a toss about the unemployed, the majority of whom want to work but can’t find it and now find themselves in a climate of persecution:
http://www.independent.co.uk/news/uk/politics/rachel-reeves-says-labour-does-not-want-to-represent-people-out-of-work-10114614.html
There are times when I want to give them all a slap and tell them to grow up!
That was a Party political Broadcast on behalf of the Apathy Party.
You keep parroting the same line “there’s no difference” – yet fail to provide any evidence in support. meantime the flood of big business money into Tory coffers suggests that your analysis is not universally shared…
You’re presumption of apathy on my behalf is totallyincorrect, as usual. I am anything but, and will vote accordingly. Your trumpeting of Labour seems top me to be of the lesser of two evils solution. As far as I’m concerned, that’s just not good enough. Labour supporters need to get off their arses and sort their party out, into something that properly reflects its founding principles, not this Tory lite caricature. Tony Blair was one of the worst things to happen to this country as it turned out, and no wonder he’s a hero of Lord Snooty, along with Mrs T. Go figure, as they say in modern parlance.
A muted trumpet if so!
I just think the notion that there’s no difference doesn’t stand up to serious scrutiny.
My view is that their basic agendas and the interests they serve eg. the global free market neo liberal, are the same. Old style Socialism and Conservatism are dead. They have differences, yes, the veneer I refer to, and one is obviously preferable to the other. That is why I will be voting Labour, but I despair at the lack of real choice and opportunity for genuine change. Three different serpents on the head of the neo liberal free market Gorgon.
I’m swearing off the political threads that rear there ugly heads in our lovely new digs.
Y’all know which side I dress on so fill in the blanks for yourselves.
Here you go Tiggs: “””””””””””
Just a few spare inverted commas I had lying around – thought you could use them for your first paragraph.
You see to have run low around the time you typed the words “employment”, “jobless” and “better off”.
Here’s The Guardian’s take on the inverted commas issue.
http://www.theguardian.com/politics/reality-check/2015/mar/18/reality-check-will-living-standards-really-be-higher-this-year-than-in-2010
Reality Check – Was Osbourne Telling The Truth?
Spare a thought for my mate who paid the deposit on his first house on Tuesday, only to find that on Wednesday they introduced a £3k grant for first time buyers.
A deposit on a house never used to be legally binding. I would suggest that he goes back to the vendor and asks them to rip up the paperwork, start again and split the three grand.
I ran the calculator on the BBC’s website… apparently the budget makes me £134 better off a year. Yep – an extra £2.57 a week. Wooo! I’m living the high life from now on. -_-
That’s a new CD every month!
With the nearly £2000 my family spend annually on booze (yeah I know, what are you, my doctor?) this Budget makes us better off to the tune of slightly less than one (London) pint.
“My family”?
I hope you’re including booze fut baby….
I didn’t, but I’ve just realised if we doubled our consumption we’d get two free pints instead of one! How’s that supposed to promote responsible drinking, huh?
Anybody ever been in a pub in recent years and spotted the price of a pint drop by a penny after the budget? Neither have I. Many years ago, when I worked in a brewery, they usually introduced their price rises at the same time as the annual budget increase. it was so the government got the blame and not them.
The penny stays on the pint but hopefully goes towards employing an extra bar person or upgrading the toilets once in a while to make the place more welcoming. It’s a pub subsidy. A penny a pint pubsidy.
If they brought in minimum pricing per unit of alcohol, pubs would become more popular overnight, dangerous drinking would go down, total units consumed would fall and the supermarket cartel on take-out booze would be dispelled. I wonder why they don’t do it?
It wouldn’t affect pubs, but as for the supermarkets, damn right. They give the stuff away
It would help pubs because the differential in price would narrow; the cheap supermarket booze becoming more expensive whilst the pub price remains the same. So, when balancing the options, a drinker will find a sociable pint in a pub a more enticing option.
I was going to post the front page of The Sun but it could induce a bout of the vapours amongst our more delicate members. View it here instead. You have been warned.
http://www.theguardian.com/media/2015/mar/19/daily-mail-teletubbies-george-osborne-budget-sun-strut
Beware the term ‘record employment’. Yes there may be more jobs out there, but what kind of jobs, and what kind of terms and conditions? Companies are increasingly grinding down workers rights (scrapping sick pay, reducing holidays, and introducing annualised hours or zero hour contracts, which leave employees stuck between a rock and a hard place when trying to get a mortgage or sign a rental contract). The profits of the booming economy ain’t trickling down anywhere.
All true. But, despite their rhetoric, I don’t see Labour changing much of this if they get in. Imagine rising unemployment and a reduction in jobs within the first few months of a new government.
The zero hours contract and how it interacts with the minimum wage is surely something a Labour government would look at though?
http://www.bbc.co.uk/news/uk-31258205
You’d think so, wouldn’t you. However, in that example, it is clear that social care is underfunded at a time when the number of elderly with needs is increasing. If care workers had a proper contract at the minimum wage, which is so obviously the right thing to do, the cost would ultimately rest with the taxpayer. Have Labour factored this into their deficit reduction plan? I doubt it.
As usual, there’s been one or two lone moral voices, but not much happening officially, which doesn’t surprise me. Labour created the Atos ball don’t forget. The Tories just ran that bit further with it and Labour are only making mealy mouthed platitudes re the vulnerable. I spent many years working in care/support work and could see what was coming if/when the Tories got hold of Labour’s new strategy.
http://labourlist.org/2014/10/the-scandal-of-the-care-workers-who-dont-receive-the-minimum-wage/
It’s all about the economy and what we can afford – everything else depends upon that. Out of all the parties, which one do you trust most to get it right? Out of all the leaders, who has the best credentials to be Prime Minister? Which leader would you trust in an international crisis?
Do you want the UK to stay on the path of recovery, or do you want the UK to borrow more and deepen the deficit? Do you want another coalition, or would you rather have a clear winner?
You don’t have to like the winners, just trust them to do a good job for the UK and its people.
If each party leader was a playing card on a table, which one would you pick?
You have a few weeks to consider these questions then place the cross in the box. Decisions are taken by those who turn up.
Sleight of mouth ahoy!
“Do you want the UK to stay on the path of recovery, or do you want the UK to borrow more and deepen the deficit? ” smacks of “what time did you murder your wife?”
How about “Would you like to speed economic recovery – or would you like to delay it by unnecessary austerity?”
Is there any doubt the UK is growing faster than any other developed country? Today’s Guardian claims it is because of net immigration, which has added 0.5% to annual growth as they are mostly young of working age who pay taxes. They haven’t taken jobs from UK citizens either, as growth in jobs for the resident population has risen more.
Borrowing more money (deepening the deficit) will delay the amount of time for a financial recovery. We can’t go on forever in the red – debts need to be paid back and the UK is paying interest on all our borrowings until we do (servicing the debt). That money is therefore tied up, rather than being used for other things. Borrowing money has caused the austerity, because we have to pay it all back and pay interest. So we should avoid borrowing more money in order to stay on the path of recovery. A swifter recovery will reduce the level of austerity and the amount of time we are subject to it.
I think it was an effective budget as a part of the Tory’s election campaign. Osborne conveyed the message we will hear ad nauseam for the next few weeks, that ‘the conomy is on the road to recovery under the Toris and you would be mad to give it back to Labour to screw it up again’. I sense that’s working as a message because there are enough indicators of some recovery to support it, and because its what people are inclined to believe anyway.
There is another subliminal message which is this ‘the things you think Labout are good at like health and social care are so fundamentally broken that Labour have no more idea how to fix them than we do so there really is no point voting for them’. Labour are proving so hopeless at conveying their vision for these things that they are failing to counteract this impression.
But George has two fundamental questions which he is dodging.
1 you staked the reputation of this government on putting us through hard times in order to eradicate the deficit, after which we would enjoy the fruits of that achievement. The deficit has come down but only by a third, and is still over £90b. Why have you failed and assuming you still believe we have to get rid of it, what does this mean for your policies and public spending if you get back in?
2 in this budget you are stating great store by further savings from welfare and clamping done on tax avoiders with no detail whatsoever on how you’re going to do it. So how – where’s that money coming from?