Andrew Allison – A Budget from Brussels
It’s hardly a surprise that “Project Fear” made an appearance in this Budget. It was only a matter of time, and by outwardly attempting not to politicise the Office for Budget Responsibility, George Osborne has done just that. Not that the OBR has a good track record of predicting anything, and it is safe to assume that its predictions on Brexit are as worthless as its deficit reduction forecasts.
Business can’t pay tax, only people can pay tax. The Chancellor must know this (and in one way admitted it), so he knows that the new levy on sugary drinks will ultimately be paid by consumers, shareholders, employees, or a combination of all three. This new tax could only have been proposed by a Socialist or a Patrician Tory. And, of course, it starts with sugary drinks and will then move to other products containing sugar – even though sugar consumption is falling.
Osborne is determined to devolve power to regional governments on his terms. In the process, he is destroying local democracy against the many wishes of local people. Those living in rural communities are not going to get a good deal, but if they fail to go along with the Chancellor, he will cut their funding, forcing them to comply. I’m sure his chums in Brussels love this anti-democratic process – it is straight out of their rulebook.
Andrew Allison is Head of Campaigns for The Freedom Association.
Rebecca Coulson – Osborne isn’t just cutting for cutting’s sake; he should say so
After a year of magic rabbit, golden boy moments, it’s suddenly not so easy for the Chancellor. Thanks to Labour’s inadequacies, most Conservatives don’t need wide-spread appeal; Osborne’s political future still depends on being the man with the long-term economic plan.
Sure, the fiscal charter may be unnecessarily ambitious. But growing global uncertainty doesn’t make Osborne’s plan flawed. That’s hard to claim, however, without also admitting that it wasn’t Labour’s (certainly reckless) overspending that caused the financial crash. Yes, state downsizing is needed, but this has, for too long, been explained simply through the rhetoric of “fixing the economy”: welfare is one of the last areas that should be cut to save money, but that doesn’t mean it wasn’t over-extended. A government’s duty is to protect its citizens – as Conservatives, this might involve helping them to help themselves.
Today’s Budget shows Osborne’s continued progress with that, despite difficult times. Okay, further increases to the personal tax allowance don’t affect the very poorest earners. But country-wide infrastructure investment isn’t welcome merely for stimulus. Again, more needs to be done about housing, but the Lifetime ISA and Help to Save scheme will help first-time buyers. And education remains a focus with academisation, and extra time for extra-curricular enrichment.
Fixing things doesn’t fit into a caricature of Conservatives cutting for cutting’s sake, or Labour spending for spending’s sake. To secure his future, and Britain’s, Osborne should point that out more.
Rebecca Coulson is a ConservativeHome columnist and was Parliamentary Candidate for the City of Durham at the 2015 General Election.
Annabel Denham – Some help for entrepreneurs, but more could and should have been done
After the burdens to business of a National Living Wage, tax on share dividends, and auto-enrolment on pensions, entrepreneurs were looking for some compensation from the Chancellor in this Budget. On the face of it, Osborne has delivered. Cutting the corporation tax rate to 17 per cent by 2020 will increase investment within companies, while the Lifetime ISA should drive further investments into equities.
He missed a trick, though. Osborne should have extended the ISA wrapper to include unquoted companies, which help ensure that we have more companies scaling up.
Small businesses will be celebrating the Chancellor’s decision to raise the business rate relief threshold from £6,000 to £15,000 – though it’s worth noting that this will actually benefit landowners, rather than occupiers. The £1,000 allowance to help micro-entrepreneurs in the sharing economy will also be welcome, as will Stamp Duty Land Tax reform on non-residential property transactions and the extension of Entrepreneurs’ Relief to long-term investors in unlisted companies.
Abolishing Class 2 National Insurance (NI) for 3.4 million self-employed people is a step in the right direction, but the NI regime makes our tax system more opaque and places a disproportionate burden on small businesses. Instead, the government should be integrating employers’ NI contributions, income tax and employees’ NI into a single tax on labour income.
Annabel Denham is Head of Projects at the Adam Smith Institute and Programmes Director at The Entrepreneurs Network.
Peter Duncan – Osborne is helping Scotland until Scotland has to help itself
The Budget will be viewed from Scotland less for what it does to the political environment now, and more for what it will do for the debate in Scotland in the future, when further tax powers have been devolved to the Scottish Parliament. For the political discourse north of the border has already, and wondrously, started to move on from exclusively chewing over how to spend Westminster’s largesse, towards a time when Holyrood will take some (although, not yet enough) of the difficult tax-raising decisions for itself.
In the meantime, Osborne’s spending focus on devolved areas of health and education will disproportionately support Barnett funding in Scotland, meaning that some of England’s toughest decisions on spending will once more be avoided in Scotland.
Nationalists understandably found the moves on North Sea Oil taxation unanswerable – although moving the revenue tax rates is hardly relevant when no-one is making any money in offshore oil. Better, perhaps, to have focused on measures encouraging exploratory investment.
Similarly, we can all raise a glass of (diet, sugar-tax free) coke to his freezing of duty on scotch whisky, where he has a track record of supporting one of the UK’s most important exporting sectors.
Peter Duncan is Managing Director of Message Matters.
Suella Fernandes MP – The Chancellor is right to continue the schools revolution
I was delighted to hear the measures in the Budget focussed on helping the next generation, which include a real commitment to aspiration and better education from this government.
The Chancellor’s announcement of further devolution of power to school leaders, with all schools set to become academies by 2022, is bold and absolutely right. It will accelerate the revolution we are seeing in our schools, where teachers are free from local authority control, good heads can make better decisions, and children’s talents and skills can be encouraged. Having myself set up a free school, I believe that devolution of power to schools can only be a good thing. In the two years our school has been open we’ve seen radical progress in literacy, numeracy and behaviour, and we see our teachers empowered and liberated to inspire the next generation in subjects about which they are so passionate. I want all children to benefit from this excellence in teaching.
A recent OECD study assessing standards in schools ranked English teenagers 22nd out of 23 developed countries in numeracy. So the announcement today that Sir Adrian Smith will lead a review into 16-18 maths teaching is very welcome. If our young people can’t add up or do simple maths, they will be ill-equipped to handle pensions, bank accounts or to succeed in business. I’m very keen to tackle this issue, which is also the subject of an inquiry I am currently chairing with the charity Young Enterprise looking at Financial Education and the National Curriculum.
Suella Fernandes is the Member of Parliament for Fareham.
David Kirkby – From infrastructure highs to welfare lows
Encircled by lower growth and higher borrowing, the Chancellor’s eighth Budget was a mixed bag.
It was a good Budget for savers. Building on the success of the Help to Buy ISA, there will be a new Lifetime ISA for adults under the age of 40, which will receive some match funding from the state. The ISA allowance will rise to £20,000, and for those on low incomes there is a new Help to Save scheme, enabling those on Universal Credit or Working Tax Credits to receive 50 per cent match funding on some savings. Bright Blue has long been calling for new measures to incentivise and reward savers on low incomes, in particular through match funding.
Announcements on Crossrail 2, a new high speed rail link between Manchester and Leeds, a road tunnel linking Manchester and Sheffield are promising; they are projects worthy of the announced planning funding. For too long, transport projects have been about patching up the most decrepit parts of our road and rail. The Chancellor deserves credit for treating infrastructure investment as something which can be economically transformative, rather than merely remedial.
The cuts to disability benefit and the Personal Independence Payment (PIP) are, however, a mistake. PIP covers the extra costs of disability and is received by those in work as well as those out of work. It is unclear what justifies these changes – worth over £1.2 billion – and similarly unclear how they square with pre-election promises to protect the disabled from welfare cuts.
David Kirkby is Senior Research Fellow at Bright Blue.
Andrew Lilico – £31 billion of consolidation just before the General Election? Pull the other one.
If the economics means you can’t (and don’t need to) do anything fiscally big, try doing a zillion little things instead. “Let a thousand budget measures bloom.” What are the big stories? Expect to hear the Remain campaign repeat endlessly the OBR remarks about the uncertainties of Brexit. The tax on sugary drinks. Cuts in capital gains and corporation tax, plus a first (tax avoidance-related) step on the path to taxing debt interest. Accelerating the repatriation of business rates to local authorities. Abolishing petroleum revenue taxes (so the SNP couldn’t fund its plans from oil revenues, even if oil prices go back up). A bit of progress on raising the personal allowance and the higher rate threshold. Some £3.5 billion in “efficiency savings”.
The really big thing is the large swing in the fiscal balance in the final year of this Parliament — £31 billion in tax rises and spending cuts just before the General Election. Does anyone believe that? Of course, the chances are that Osborne won’t be Chancellor by then, so it won’t be his problem.
Overall, I think there was a bit more to this in terms of business tax reforms than I’d expected. That could be a recurring theme through this Parliament.
Dr Andrew Lilico is Executive Director and Principal of Europe Economics.
Tim Loughton MP – A freeze for spirits, but not for wine
I called on the Chancellor to serve up another round, and it was great to see him freeze spirits duty, after we saw him roll out a 2 per cent cut last year.
The UK spirit industry is growing year on year. Nearly 300,000 jobs depend on it, and British Gin is rising rapidly, exporting to more markets than ever before.
However, given a 4 per cent increase in Exchequer revenue since last year’s freeze to wine, there was a real opportunity this year for Osborne to get a double cheer from the industry. Revenues increased for both wines and spirits last year following the cut/freeze, and this is indicative of the fact that duties on these great British drinks remain absolutely and comparatively very, very high.
It is very disappointing that the Chancellor has failed to support our fledgling English and Welsh wine industry, in the same way he does our Gin and Scotch ones, with an increase in wine duty by inflation. With a plan to export ten times more product by 2020, English and Welsh wine really is the rising star of this industry. In addition, with beer receiving preferential treatment to wine once more, it really is unfair on wine’s 30 million drinkers.
But recognising that there will always be next year, I’m looking forward to championing these great British products and continuing to help build their reputations as drinks to be truly proud of, both inside Parliament and out.
Tim Loughton is the Member of Parliament for East Worthing & Shoreham.
Raffy Marshall – A Budget that succeeded in being banal
The Chancellor’s Budget was routine and predictable. Taxes inched slightly up or down. The deficit contracted a little more. A rather technocratic sugary drinks levy will get most of the headlines. For all of Osborne’s speechifying and Corbyn’s directionless fury, this is a Budget most voters can afford to ignore.
In a world increasingly convulsed by geopolitical turmoil and a sickly global economy, this irrelevance is impressive. Banality has been snatched from the jaws of disaster. The delivery of such a normal Budget is a fitting testament to the Chancellor’s economic achievement over the last six years.
Osborne continued to preside over a gradual but relentless rebalancing of our economy away from high taxes and a web of exceptions towards lower, simpler and fairer taxes. Families, investors and businesses of all sizes win.
Most of all, this Budget was characterised by a single-minded determination to address the principle threats to Britain, from deficit spending to Scottish Nationalism. The Chancellor didn’t pretend to have a magic solution to any of these troubles, but he made a worthwhile contribution on each. A routinely effective budget in troubled times.
Raffy Marshall is a history student.
Spencer Pitfield – One Budget for One Nation
Today’s Budget continues the Government’s focus on supporting those who want to get on in life and climb the ladder of prosperity.
By specifically incentivising saving, with ‘Help to Save’ for low earners and the Lifetime ISA, the Chancellor reinforces the knowledge that financial independence is a key factor to social mobility.
As a school teacher, I am particularly pleased to see £14 million earmarked for a mentoring scheme targeting teenagers at risk of underachievement or of dropping out of education completely. This investment, modest by Government standards, will give 25,000 young people the potentially life-changing opportunity of mentored support – help that we know can make a significant impact on a young person’s life chances.
A new levy on sugary drinks is to be hugely welcomed – the funds of which could be in the region of £520 million – and will be reinvested in a new school sport programme. The Chancellor is right to say we should not sit back whilst our young people become ever more obese.
By pressing ahead with £300 million of large-scale infrastructure projects, the Chancellor not only strengthens Britain’s long-term economic security – but, in so doing, creates even more new jobs and helps to raise living standards still further. The focus on the North of England – including my home town of Sheffield and a possible trans-Pennine link to Manchester – shows that there is big thinking going on, but we need to see delivery on these lofty ambitions too.
This Budget further underpins our One Nation Conservatism, not only in its aspiration to change life chances for all, but by doing what the state should – supporting those who take the first steps on the ladder to climb higher.
Dr Spencer Pitfield is the Director of Conservative Trade Unionists.
Gary Porter – Thank you, George, for listening to councils
Councils have played their part in balancing the nation’s books over the past six years, so it is very welcome news that the Chancellor has listened to local government and will not be making any further in-year spending reductions. I would like to thank him and Greg Clark for listening to councils’ lobbying in relation to this in the run-up to both this Budget and the recent Local Government Finance Settlement, and also for the announcement of a whole public sector efficiency review.
The announcement of further devolution deals, including in my own county of Lincolnshire, will result in more decisions being made in local communities rather than in Whitehall. It is also significant that the three deals are in non-metropolitan, two-tier areas, thus ensuring that the benefits of the Government’s ambitious localism agenda will now be spread beyond city and urban areas.
The localisation of business rates has been a longstanding ask of local government and it is great that this is being delivered by a Conservative Government. I welcome today’s announcement on the pilots, which represent a further important step towards localisation across local government by 2020.
Others measures, including £700 million for flood resilience and £155 million to address homelessness will also be warmly welcomed by councils.
Lord Porter of Spalding is Leader of South Holland District Council.