12 Comments

• Tabman 18th Mar '15 - 12:54pm

  Any surprises yet?

• Mary Reid 18th Mar '15 - 1:30pm

  Have just posted about the tidal power announcement.
  https://www.libdemvoice.org/victory-for-lib-dems-with-announcement-of-worlds-first-tidal-lagoon-45065.html

• tabman 18th Mar '15 - 1:35pm

  Review of IHT Deeds of Variation .,.. Very good

• Eddie Sammon 18th Mar '15 - 2:04pm

  Job figures continue to astound. Very pleased with paying down some debt. A good budget. Let’s hear more about how it came about and the Lib Dem’s influence on it.

  No silly tax cuts for the rich too.

• ATF 18th Mar '15 - 4:29pm

  Good points, Eddie Sammon.

  I doubt this the budget Osborne hoped he’d have been able to give – would imagine a great raft of measures were nixed by NC and DA.

• Eddie Sammon 18th Mar '15 - 5:00pm

  Thanks ATF. I agree some of the good stuff wouldn’t have happened without the Lib Dems.

  I didn’t agree with everything, but paying down the debt for me was a sign that the government hasn’t been captured with complacency over the economy.

  The announcement of reducing plans for austerity will be welcomed by many too. We might even get a boost for Danny Alexander with this budget.

• paul barker 18th Mar '15 - 5:18pm

  If you want to read the Labour response its over on Labour List; of the comments so far the most positive about Milliband was that he wasnt That bad.

• Gareth Epps 18th Mar '15 - 11:36pm

  It is a pity that the reality of Osborne’s gimmick on beer duty hasn’t yet been grasped: this is a measure that advantages the pubcos and big brewers rather than publicans or consumers.

  Reality is that the pubcos have since the abolition of the beer duty escalator put prices up by around 28p a pint – well above the rate of inflation and well above the increase in free houses. The reason for this is of course their enormous debts and unsustainable business model that thankfully the Lib Dems have forced reform of.

• Alex Sabine 19th Mar '15 - 4:09am

  Eddie: Unfortunately there is no “paying down the debt” scheduled until the budget returns to surplus towards the end of the next parliament. But we have at least finally got to a position where the debt-to-GDP ratio is stabilising, which is good news. (It’s just a shame it’s stabilising at 80% of GDP in net terms and 90%-100% in gross terms, depending on the measure.)

  Incidentally, note that the only reason the debt ratio starts falling in 2015-16 (a year earlier than the Autumn Statement forecast, and in line with Osborne’s original ‘supplementary fiscal rule’) is the timing of the sale of bank shares. Asset sales don’t reduce the headline deficit (Public Sector Net Borrowing) but they do reduce the stock of debt, which is driven by its flow counterpart the Public Sector Net Cash Requirement.

  There is a sudden drop in PSNCR next year thanks to the asset sales which results in a very slight fall in the debt ratio in that year. Then by 2016-17 the deficit is small enough to keep debt:GDP stable. So broadly debt is stable as a share of GDP over the next few years and only starts falling noticeably in 2017-18. This, by the way, is why Osborne was able to claim that any deviation from his plan will result in the debt ratio rising, not falling. it’s because even on his plan the debt ratio is only inching downwards over the next three years – ergo any loosening will cause debt:GDP to remain on an upward trajectory for some time.

• Bill le Breton 19th Mar '15 - 11:50am

  Alex you make a very good point about Osborne and Harrison’s political understanding: “This, by the way, is why Osborne was able to claim that any deviation from his plan will result in the debt ratio rising, not falling. it’s because even on his plan the debt ratio is only inching downwards over the next three years – ergo any loosening will cause debt:GDP to remain on an upward trajectory for some time.

  Again, evidence that this was a budget too far for the LDs in the Coalition.

• Sadie Smith 19th Mar '15 - 2:12pm

  You would have thought that the Speaker would have worked out how to cope with coalition ministers by now. He has had the best part of five years.

• Alex Sabine 19th Mar '15 - 5:22pm

  Bill: As you can imagine, I was not impressed by the sleight of hand. Of course the asset sales (Lloyds shares and some of the assets of Northern Rock) were always going to happen as some point, and Osborne has decided to use them to make a downpayment on debt reduction rather than to pay for current spending. Fine.

  It’s just that the timing is rather convenient, and it would have been better to admit that this was the reason why debt-to-GDP now starts to fall a year earlier, rather than a genuine improvement in the underlying budget position since the Autumn Statement. After all, if you sell assets for what they are worth you improve your cash flow but you do not change your underlying solvency/indebtedness.

  But then I am not a politician, obviously… In the greater scheme of things this is a minor issue, but an example of ‘naughty behaviour’ as the IFS call it 😉