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- Today's leader
Budget 2010: Chancellor hits better-off
Wednesday 24th March 2010, 12:40PM GMT.
Chancellor Alistair Darling outlines his spending plans
Chancellor Alistair Darling turned the screw on the better off today as he gave a helping hand to first time buyers.
In his last budget before the General Election he announced that the threshold for stamp duty on home buying would double from £125,000 to £250,000 from midnight tonight.
But to cheers from Labour MPs he also announced that the move would be funded through an increase in stamp duty to 5% for residential property over £1 million from April next year.
Other points announced:
- He said he was setting out a Budget to secure the recovery and tackle borrowing. The economy is at a crossroads and the Budget sets out a route to long-term prosperity.
- Mr Darling will stick to plan to halve the deficit within four years.
- Tax on bankers’ bonuses raised £2 billion in 2009/10, twice as much as forecast.
- Guarantee that everyone will have access to a bank account, creating a million more bank customers.
- Work or training for all under-24s out of work for six months.
- Six more months of mortgage support for the unemployed.
- Stamp duty limit to double from £125,000 to £250,000 from tonight, funded by an increase to 5% on £1 million-plus homes.
- ISAs: Limit to rise from £7,200 to £10,200 and will increase thereafter annually in line with inflation.
- Economy growth forecast lowered for 2011 to 3-3.5%.
- Inflation next year forecast to be back to 2%.
- Tax receipts better than forecast in the first quarter.
- Borrowing this year should now be £11 billion lower than forecast, down from £178 billion to £167 billion.
- Debt expected to be £100 billion lower by 2013-14 than forecast.
- Deficit will be halved over a four-year period.
- No further announcements on VAT, income tax or insurance.
- Duty on beer, wine and spirits to rise 2%. Tax on cider increased by 10% above inflation from midnight on Sunday.
- Tobacco duty increases today by 1% above inflation this year, then 2%.
- Inheritance tax threshold frozen for four years.
- Savings across the public sector “tough but achievable”:
- Departments will publish details about how to achieve £11 billion of new savings.
- Total of 15,000 civil servants relocated, including 1,000 Ministry of Justice posts moved out of London.
- From October next year, most expensive properties excluded from housing benefit scheme.
- Progress on £16 billion asset sales, including Dartford Crossing, the Tote and student loan book.
- RBS and Lloyds to provide £94 billion of new business loans, half of them to small and medium businesses.
- New growth capital fund to provide capital for fast growing firms.
- Business rates cut for a year from October – meaning 345,000 will pay no rates at all.
- Tax allowances for entrepreneurs and no increase in capital gains tax.
- £100 million to repair local roads after winter damage and £285 million for motorways.
- £2 billion green investment bank to provide equity to unlock private sector energy investment.
- Motor industry supported to develop electric cars.
- Help for creative sector including computer games and film industries to be offered.
- Universities must make efficiency savings. £35 million for University Enterprise Capital Fund for innovation. £270 million one-off payment for university modernisation.
- Tax information agreements ready to be signed with three more countries – Dominica, Grenada and Belize.
- £4 increase in child tax credit for young children from 2012.
- Will cut the number of hoursover 60s need to work to qualify for working tax credits.
- He also says the government is looking into scrapping the compulsory retirement age.
- Fuel duty rise to be rolled out. It will go up by 1p in April, another 1p in October and a final 1p in January 2011.
- £2.5bn support for small businesses
- Planned increase in fuel duty and landfill tax will continue for one year from 2014. Duty on cider to increase by 10 per cent above inflation from midnight on Sunday.
- Duty on beer, wine and spirits to increase as planned from midnight on Sunday. Alcohol duties to increase by 2 per cent above inflation for further two years from 2013.
- Number of civil servants in London to be reduced by a third, with 15,000 posts to be relocated within the next five years.
- Public pay settlements to be held at a maximum of 1 per cent for two years from 2011.
- More than £4 billion from next year’s reserve will be allocated to fund operations in Afghanistan.
- Mr Darling said stronger than expected tax receipts meant that Government borrowing would be £167 billion this year – £11bn down on the £178bn he predicted previously.
- Mr Darling said debt would continue to fall faster than previously forecast – dropping to £74 billion in 2014-15, down £8bn on earlier predictions.
- New national investment corporation, to be called UK Finance for Growth, will streamline and improve Government help to small and medium-sized enterprises, overseeing £4bn of support for businesses.
- Financial services authority to improve and speed-up licensing process for new banks to boost competition.
- New Credit Adjudicator will fast-track complaints from smaller firms who say they have been unfairly denied credit.
- Over the next year, RBS and Lloyds will provide a total of 94 billion of new business loans, nearly half to smaller firms.
- The government is making considerable progress on securing £16bn through asset sales.
- Chancellor to provide £100m to pay for vital repairs to roads throughout the country.
Mr Darling said the outlook for the future was brighter than it was a year ago, although the recovery is “still in its infancy”.
However, he pointed to rising oil prices and a lack of consumer and business confidence.
Mr Darling said it was vital for EU countries to fix the european economy.
Nationalised bank Northern Rock is returning to normality, he added.
“We intend to get all taxpayers money back from the part-nationalised banks,” he said.
He called for international tax measures against the banks, but warned the Government could not go it alone. “There can be no return to business as usual.”
He said the UK economy contracted by six per cent over the course of the recession.
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Pity they can’t come clean and admit Brown and laterly Darling have destroyed our economy.
Reduce the spending/waste and abolish all the non-jobs and quangos that have flourished.
Then again it is more new labour spin. put the Country first not a gruby useless political party.
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Why they picking on Cider ??
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if mr brown and all the mp”s give up one months wage this country would not be in this mess.these pen pushers get paid far to much for the job they do
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spencer said:
Why they picking on Cider ??
Perhaps because Darling had aquired some incider information! …………
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Drew,
No facts to support your comment I note.
Let me help. Prior to the recession caused by the near collapse of the global financial srvices sector, our debt as a proportion of of GDP (the only truly comparable measure, since it isn’t distorted by the effect of inflation over decades), was about 43%. This is a higher figure than a few years ago, but given the levels of investment in public services such as the NHS and education, this isn’t surprising. 43% isn’t an especially high proportion historically. Back in the late 50s and early 60s it was over 100%.
The effect of the bankers’ recession was to directly increase that debt to over 70% of GDP – which is a higher figure than has been normal for the last few decades.
I hope that clearly illustrates the nature of our current debt, and shows you that it is the excesses of capitalism that have put us where we are.
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Drew, Peter has a fixation over what caused this unholy mess. His Labourite pals had nothing to do with it. They didn’t borrow hand over fist when they were told by every pundit to save for the proverbial “rainy day”, they didn’t sell off our gold reserves at rock bottom prices, neither did they use the proceeds to edge against economic disaster, they squandered it. They didn’t stop the Bank of England regulating the banks, they didn’t set up the FSA then tell it to “regulate lightly”. In effect, they did nothing at all to cause this disaster, and they are not going to borrow (on average) £150 BILLION a year for the next 6 years at least. And Darling didn’t admit that in his budget yesterday, we all heard wrong. By the time the borrowing spree is over, they won’t have run up a debt of £1.5 TRILLION. In fact, they have done absolutely nothing, the hole that we are in, dug itself, all the money poured into our public services just got there by it’s own volition and now it has got to be repaid in the same way. Nobody, least of all Brown and Labour, cause these things to happen, they just do.
That is the joke that the marxist Peter’s of this world would have us believe, it’s all down to capitalism, his mates in Labour who practice to the hilt that economic philosophy have absolutely nothing to do with it. Of course, we who think otherwise and rightly believe that Labour brought this disaster on our heads are just unintelligent morons who have to bow to the heightened intellectual opinions made out to be the truth of the Peters of the world who appear to have a big chip on their shoulders whenever success, money, bosses, big business etc etc are mentioned.
Peters mates (many ex Communists) are now leading the BA strike, they are now leading the PCS strike, they will shortly cripple the country by a rail strike (the RMT) and we are shortly going to be in the maelstrom of industrial unrest that last occurred when Callaghan and his government crippled the country, forcing Thatcher to order cuts on a massive scale. I wonder what Peter now has to say when Darling admitted tonight for the first time on BBC TV news, Labour have got to implement cuts of 25% in public services, tax rises that would put Thatchers in the shade and job cuts which will make those of the Thatchers era pale into insignificance. But let’s think what Peter say’s, it was nothing at all to do with Brown, Blair and Darling, their role in it is just a figment of our imagination. Brown makes the mistake that we are all stupid Peter, you seem to follow your leader to a T.
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@ 5 and 6, You pair should really consider careers as politicians because you’ve both managed to turn an interesting subject into a dull boring battle of ego’s in a matter of sentences
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I know Stuart
Sad state of affairs being patronised by Peter!
Then again, nothing like a bitter socialist.
Why can’t they accept Brown is a deluded liar and useless too boot!
Darth Mandy is pulling the strings, has been for a couple of years.
When will we wake up from the 13 year disaster.
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Well, well “Twisting my melon,” that handle say’s it all by the way. Now perhaps we can have an intelligent input from you or don’t you know what the subject matter is about.
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Stuart,
Labour have invested heavily in education and the NHS. It may be that we were more ‘cash rich’ at the end of the last Tory regime but the NHS was in tatters, and our schools were falling to pieces.
You simply cannot dispute the fact that over 40% of our current national debt was caused directly by the greed and stupidity of Tory bankers. I’ve said it before and I’ll say it again – Labour did not create the FSA – it pre-dated them. There is not a scrap of evidence to suggest that the Tories would have had more regulation – in fact the pension and endowment mis-selling scandals that took place on their watch are proof that they wouldn’t have.
In your ever more right-wing view of the world (and I fear you must be moving more in that direction if you’re throwing your hat in with the likes of Drew!), anyone to the left of Margaret Thatcher is dismissed as a Marxist or a Communist. Don’t you think that is excessively simplistic? Do you really believe that all of the BA workers recently on strike are communists?
I looked at the institute for Fiscal studies view, which prompted the chancellor to make his comments. He certainly didn’t say anything about job cuts of 25%, tax rises, or job cuts that would put Thatchers millions of unemployed (a price worth paying you’ll recall) in the shade – you added those bits.
What was said was that the public sector would grow at an even lower rate than that which Thatcher grew it at, but Thatcher’s growth rate was set against high double figure inflation, whilst the current rate is far lower – so the comparison isn’t a valid one.
Once again – I’ve simply posted facts – I’m sorry if you feel patronised Drew – why not post a few of your own sometime?
Perhaps you could offer us some of the Tories plans for public spending and taxes, and explain how their proposed cuts in corporation tax and inheritance tax will help the working man?
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@peter “it is the excesses of capitalism that have put us where we are. ”
actually if this were a capitalist state those banks would have gone under, the people responsible would be out of jobs, and the taxpayer would not be saddled with the debt, and other banks would learn from this and not repeat the same mistakes.
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Peter,
Give or take a few words, I utterly reject every single “principle” point that you make or, am able to give it the qualification that it demands. eg Increases to Education and NHS budgets, yes agreed, increased by leaps and bounds. Now they are having to be slashed by Labour, our education ranks amongst some of the worst in the developed western nations and the NHS is now falling apart at the seams, to my personal knowledge (without doing research), 13.500 nurses were declared redundant in one year and there are many more to come. This morning on TV Breakfast, Milliband was unable to counter the allegation that steps are in hand to close wards, reduce staff and “secretly” decrease the NHS budget by millions which will hit front line services. He could not deny it. We are now learning from wilfully irresponsible spending on borrowed money, now, all that it was spent on is having to be clawed back. The NHS and Education is goinng to suffer badly.
As for the strikes which are now or about to happen, I challenge you to look up the backgrounds of every leader of Unite, the RMT and the PCS. The words “Communist” will figure largely, I assure you. I did not say that “ALL” taking part were Communists and you know it. Their leaders were.
The FSA as it is (and since Labour came in) was a Labour Invention, it’s forerunner had no “regulating” authority, Labour gave it that and then immediately took it away. The Tories would have left the regulatory aspects to the B of E who did a perfectly effective job. You know what Blair said and I won’t repeat it for the umpteenth time.
I am not extreme right wing as such, more right of centre. Darling said that cuts in every aspect would be greater than Thatcher and when it was put to him that in that case they would be more than 25% (because that’s what Thatchers were in many respects)he reluctantly agreed. Fact, ask the TV for a re-run. The snag is, we won’t get these cuts until after Labour wins the election when it will be to late to call them the charlatans and snake oil purveyors that they are.
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Stuart,
I get my facts from places such as the Office for National Statistics and from the Institute for Fiscal Studies, not from tabloid newspapers or tabloid telly.
You really need to up your game…
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