The Liberal Democrat blogosphere is continuing to talk about the Budget, so here are some of the latest offerings.
Sandy Walkington thinks that the Budget is a dish best observed cold.
I tend to aim off from all instant, hyperbolic reactions to the Budget. When I worked as a press officer in the oil industry, Budget Day was a time for synthetic outrage at the latest iniquity heaped on the long suffering motorist or on the plucky explorers of the North Sea. And then the sun continued to rise and set.
In the current global economic circumstances which only compound the reckless public expenditure annual deficit left by the Labour administration, the Chancellor cannot create a rose garden. It’s going to go on hurting as we work to get things back into balance. That’s why it is so important that the burden is fairly shared. I confess to being very uneasy at the reduction of the 50p top tax rate at this moment, and will look for objective evidence that the total tax collected from the top one percent of earners will indeed have gone up (and by a substantial sum) as a result of the overall tax measures.
Liberal England finds the Budget to be surprisingly radical:
I am told that cutting the 50p rate was the Conservatives’ chief demand from the budget – which perhaps tells you all you need know about the Conservatives. In return for allowing them this, the Liberal Democrats can point to a bundle of measures against tax avoidance that, it is claimed, will bring in five times more than the tax cut has saved.
George Osborne would probably have brought in some of those measures in any case, but what is more significant is that the tax has been reduced only to 45p. There is 5p still to come, and there is hope that in return for granting that the Lib Dems will be able to secure a mansion tax or at least some moves in that direction.
Neue Politik talks about the real life effect of the Liberal Democrats’ tax threshold rise:
I was sitting at work a few months ago and one of the part-timers at the company I work for was talking about how strange it was that she was no longer paying income tax. She said it was absolutely fantastic to get that little bit extra a month in her pay packet. I was quick to point out that this was due to a Lib Dem policy that the Government was pursuing (never miss an opportunity to evangelise…) But when I explained that the threshold would increase again this year, several other colleagues realised they too would soon be out of income tax altogether. They were, needless to say, extremely pleased.
Mark Thompson says that the Conservatives have lost the next election:
Maybe he thought hitting pensioners in the budget would help with his “all in this together” narrative. Maybe he thought the fact that the state pension is now rising in line with earnings for the first time in decades would mitigate the political fall-out. If so he has misjudged how political announcements are assimilated. The good stuff is quietly banked by the winners but the bad stuff will be shouted about very loudly by the opposition and pensioner groups. That is what will be remembered about this budget by the very people Osborne needs to vote Conservative if they are to get a majority in 2015.
The Party’s own expert bureaucrat has some facts about the cynically named “Granny Tax”:
On pensioners, the gradual loss of the additional personal allowance will not affect all pensioners, particularly female ones, who are more likely to be poor and not pay income tax anyway. It also won’t affect pensioners with income higher than £30,190 either, as they would have lost any additional sum in its entirety anyway (the allowance is lost at a rate of £1 for every £2 of income above £25,400 at present). And for those in between, the additional state pension will more than cover the effective real loss of allowances.
Thinking Liberal thinks the Budget shows the Coalition at its best:
One of the interesting features of the budget has been the disappearance of budget “purdah” – the absolute secrecy surrounding budget proposals. Mr Clegg made the early running in the media game with his bid for an acceleration of increases to personal allowances. But Mr Osborne clearly understood this to be an opportunity rather than a threat – in this case to reverse the top rate of income tax of 50%, which until a month or so ago looked to be entirely off the agenda. A few years ago the Lib Dems had a big conference battle over this top rate (before Labour introduced it, as it happens) and rejected the 50% – so there was evidently some Lib Dem ambiguity over the tax, which Mr Osborne was able to exploit. And indeed world thinking has long since turned against such high marginal rates, even for the very rich.
And, finally, a cautious welcome from the Social Liberal Forum:
Social liberals should apply same test to this budget as to all government economic policy – moving beyond a narrow debate on marginal tax, does it move us closer to a fairer, more sustainable economy with full employment and a better spread of risk and reward? The implementation of many Liberal Democrat measures means that some progress is being made towards this goal, but future policy needs to be more radical, positive and constructive if Lib Dems are to be seen delivering our values in Coalition.
* Caron Lindsay is Co-Editor of Liberal Democrat Voice and blogs at Caron's Musings