The Budget 2010: open thread

Alistair Darling has delivered his last budget as Chancellor, and what may prove to be the last Labour budget for many years. It was deeply, deeply dull, not aided by Mr Darling’s sonorous delivery. The Guardian has a summary of the key points – here are my subjective top 5:

    • No further announcements on VAT, national insurance and income tax. By freezing personal allowance, this is a real terms increase in income tax – as Mark Pack was quick to tweet, and as Nick Clegg was on-the-ball to note in his budget reponse. David Cameron, by contrast, seemed to be clueless (not for the first time).

    • The impact of the economic crisis has meant the UK economy has shrunk by around 6% over the course of the recession

    • Doubling of stamp duty allowance from £125,000 to £250,000 from midnight tonight. This will be paid for by 5% stamp duty for properties over £1m

    • Growth forecast in 2011 revised down to between 3% and 3.5%

    • The reduction in the deficit will go from 11.8% of GDP to 5.2%, more than halved over a four-year period

    • Duty on cider will increase by 10% above inflation from Sunday. Duty on beer, wine and spirits will increase as planned from midnight on Sunday

    • Inheritance tax frozen for next four years

    • Public pay settlements will be held at a maximum of 1% for the two years from 2011

    • A new national investment corporation – UK Finance For Growth – will streamline and improve government help to SMEs

    • Business rates cut for one year from October

    • A £2bn green infrastructure fund – using £1bn of public cash matched with private funds

    • Tax information agreements with Dominica, Grenada and Belize – this is pure political mischief-making, but was amusing to watch David Cameron and George Osborne go red with embarrassment at Mr Darling’s explicit Lord Ashcroft reference.

Twitter has been going #budget mad this afternoon. Here are a few of the character-limited words of wisdom from tweeting Lib Dem MPs:

  • @malcolmbruce Freezimg tax thresholds is a tax hike, Nick Clegg is right to underline our fair tax and honest spending plans
  • @SandraGidley #budget Clegg highlighting the cuts to housin benefit – and impact on low income families
  • @SusanKramer red book shows starting income for tax frozen. Effect is huge “tax” increase & hits lowest income.
  • @jgoldsworthy p141 red book confirms that income tax starting allowance is frozen – a stealth tax on the lowest incomes. #budget2010
  • @SusanKramer Cuts to housing benefit maximum will really hit my area – where are we meant to house people since we have so little social housing?
  • @jgoldsworthy Never before has a chancellor said so little in so many words….#budget2010

Here’s an excerpt from Nick Clegg’s budget response:

This Budget was a political dodge not an economic plan.
 
“Britain needed a Budget that gave us honesty in spending and fairness in tax, we have got neither.
 
“Labour is in denial, while the Conservatives are talking tough to cover up that they only offer more of the same.
 
“The Chancellor is incapable of coming clean about where spending cuts will have to fall.
 
“Rather than being honest with people about what the Government can and cannot afford, the Chancellor would rather let others indiscriminately shave departmental budgets.
 
“By confirming the freeze in personal allowances the Government has ensured everyone will see a real increase in their income tax bill – when what people on low and middle incomes desperately need is an income tax cut.
 
“Rather than forcing the nationalised banks to lend to good British businesses they have chosen to create a feeble quango to arbitrate between bullying banks and their small business clients.
 
“It says something when the most substantive announcement the Government can come up with is a tax agreement with Belize, however welcome that may be.”

In terms of delivery, Nick’s content was great though his delivery was distinctly under-stated. Ironically, the complete reverse tio David Cameron, whose content was insipid and performance hyperbolic.

Anyway, what did LDV’s readers make of it all?

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6 Comments

  • Cllr Patrick Smith 24th Mar '10 - 3:40pm

    This last Labour Budget was truly an obfuscation of the real mess that the Economy is actually in, as the National Debt looms large on the radar for the new incoming Government post May 6th.

    Nick Clegg has stated the Country has a daily borrowing requirement of £145 Million.

    I make three observations:

    1.Under Labour the worst off are worse off from this Budget and there still remains the biggest inequality gap after a period of 13 years. 1 in 4 school leavers are facing a jobless future and the prospect of student debt is still the preferred apprenticeship for those in higher education. Labour also chose to cut Housing Benefit for the lowest income tenants.

    2.It is only Vince Cable who has come up with a `Fair Taxes’ relationship with the `fat cat’ City Bankers who would tax their profits not their bonuses in a Lib.Dem.Government and would insist on the strong lending rate to small businesses.

    3.This lack lustre Chancellor has done nothing to reduce household utility bills for the £3.6 million beneficiaries of the L/D Fair Taxes exemption on the first £10K of earnings.And Brown has sold off the nation`s gold reserves and left our State pensioners short without any increase in pensions.

  • I say this as a lifelong Liberal Democrat supporter. It is simply not true that Clegg did better than Darling or Cameron, at least if you measure it by their performances in the house rather than looking at the substance of what they were saying. Darling came across as serious and thoughtful, Cameron as energetic and alert to the flaws of what Darling was saying, whereas Clegg (not helped by the rudeness of the MPs who left the house or ostentatiously ignored what he was saying) had his face buried in his notes and said predictable things like, “The other two parties are both the same,” that just reinforce people’s perceptions of the Lib Dems as a minor party with no hope of getting elected.

    I admit that he was in a very difficult position, but I think he just didn’t get it right today. The best part of his speech was where he said what cuts the Lib Dems would make. I think he should have expanded that and only then pointed out how much more substantial it was than what Darling had said. And he could have just ignored Cameron, just as Cameron ignored him.

  • I agree that he was buried in his notes, but what he said made far more sense than Cameron’s flailings, and the shots of empty Labour benches as MPs rudely stream out during his speech will hopefully play well. Otherwise, a long, dull budget, another nail in the NuLab coffin.

  • Chris Taylor 25th Mar '10 - 4:42pm

    The Liberal Democrats say winter fuel payments for pensioners under the age of 65 should be cut now and not gradually over the next decade as the government is planning. Whoops, there’s another 8% of the electorate lost.

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