Here we are then – the last Budget of this Parliament and the last one by George Osborne as Chancellor of the Exchequer! He may be back or he may not and this depends very much on how the electorate receive this Budget.
The next 50 days will be among the most exciting in British electoral history; the outcome of which is impossible to predict. At present the Tories and Labour stand equal in the opinion polls and this Budget has done little to change that.
Osborne called it a Budget for ‘economic security’ and for ‘true national recovery’. The detail of the Budget, if fully implemented and achieved would be good enough to fulfil both of these objectives in spades. The question now is will the voters believe it and be confident there are no hidden ‘tricks’ waiting in the wings should the Tories be returned to power.
The traditional ‘election Budget’ payoffs for the masses were not in evidence as Osborne delivered his address from the despatch box. For avoiding the cheap wins, the Chancellor should be applauded; he set out his stall to demonstrate stability and responsible budget management and on that score today has been a success. No reductions on alcohol or cigarettes, no reduction in fuel tax or VAT rates and, thankfully, at the same time there were no increases!
A Budget of few treats
- Beer duty cut by 1p and cider by 2p.
- 2% cut in excise duty on Scotch whisky while wine duty frozen
- No changes to tobacco and gambling taxes, with tobacco duties set to rise by 2% above inflation, equivalent to 16p on a packet of 20 cigarettes.
- Petrol duty frozen – September's planned increase cancelled
Tax allowance increases
All of us get a slightly increased tax free allowance and tax exemption of income from savings but other than this there was little for the average voter.
The tax-free personal allowance to rise from £10,600 in 2015-6 to £10,800 in 2016-7 and £11,000 in 2017-8
The threshold at which people start paying 40p income tax to rise by above inflation from £42,385 in 2014-5 to £43,300 in 2017-8
The Tories are relying on us to understand what the Budget changes are and how they benefit all over the next five years. Plus, of course, we were warned of the risks of letting Labour come back to power; putting the sacrifices of the past fives and the promise of jam tomorrow at risk.
Osborne played very much to the older audience and the family home makers but not the young first time voters. This may be a tactical mistake the Conservatives live to regret.
The balance of power is no longer in the hands of the traditional ‘big three’; in this election, should there be no outright winner, the minority parties will have a significant role to play. To this end Osborne has sprinkled little treats for all of them – leaving the door open for the new coalition government negotiations.
Cameron and Osborne are betting that the majority of voters who go out to vote on Thursday 7 May will have read and understood what went into this year’s Budget and how it will affect them individually and their wider family. This could be enough to see them over the line with a majority, though it seems far more likely that they will again be in coalition with one of the smaller parties.
If this strategy fails then they have left the doors open for Labour to do the same with the two Eds – Balls and Miliband – moving into Downing Street. Interesting times for all of us – hold on to the handrail this ride has a long way to run.
Sources: BBC, Hargreaves Lansdowne
Images:Thinkstock/Peter MacdiarmidLast modified: March 18, 2015