Osborne delivers a 2016 budget for the ‘next generation’

The Chancellor of the Exchequer, George Osborne delivered his eighth budget to the nation, but his first as a Conservative Chancellor in a majority government. This meant no restrictions but also for the scrutiny that will surely follow, no-one else to blame.

Headlines

Chancellor George OsborneThe budget, Mr. Osborne said reflected uncertainty in the world economy and as such growth forecasts for the UK economy were revised down from 2.4% in the Autumn Statement to 2%. Although the Chancellor did still predict a surplus by 2019/2020 and that the UK would still grow faster than any western economy.

Catchy announcements were the new sugar tax, full academy school status, money for flood defences, lifetime ISAs, further cuts in public spending, debt targets missed, £115 million to tackle homelessness, extension of elected Mayors, 3% reduction in corporation tax, fuel duty frozen and a raise in those lifted out of paying tax.

What the critics say

The Labour Party, in a speech by its leader Jeremy Corbyn, accused the government of successive failures. These included “systematic under-investment in the North”, cuts to disability benefits and putting their “mates” first with reductions in corporation tax. Labour welcomed the tax on sugary drinks but said a generation had been “locked-out” of home ownership and overall the budget was for hedge fund managers rather than small businesses.

In a comical part from the speech, the Chancellor said that former pension minister, Steve Webb, had said that he would like to abolish the tax-free lump sum. He dismissed this and said he would much prefer to abolish the Liberal Democrats. The party’s press team responded in seconds to say that as Mr. Osborne had failed on most of his other targets they were not too worried.

In a shock resignation, a few days later, Iain Duncan Smith resigned as the Secretary of State for Work and Pensions. Putting the blame firmly with the Chancellor, he cited the cuts to disability benefits as disproportionate to the pledges made to middle and high earners in the budget. IDS claimed that it showed that they weren't really 'in it together.'

Main Points from the Budget: How will it affect you?