Nice, but not enough

Take nothing on its looks;
take everything on evidence. There’s no better rule.

So the dust has settled on George Osborne’s penultimate pre-election Budget. How do you feel now then chaps? Richer? More secure? Happier?

No. Me neither.

Personal allowances might have gone up but not by enough to make the population feel much richer or more confident about spending.

OK, so we had some crumbs from the Bullingdon man’s table. The pledge to

‘get Britain building’, is, obviously, very welcome to the ears of an industry that has been calling for such action for the last five years.

The extension of Help to Buy is also clearly something that the industry has already ‘benefited from, so it feels right that it should have been extended. The bit that’s really working for the industry anyway. I’m still not convinced that Part 2 (for houses that aren’t new-builds) doesn’t have a nasty sting in its tail in the form of burgeoning house prices.

The £150m to support the self-build sector, the changes on savings and ISAs, the cap on the carbon price floor until the end of the decade, the new compensation for the rising costs of the Renewable Obligation and the Feed-In Tariffs, the doubling of the annual investment allowance to £500,000, the Builders Finance Fund: all these are good initiatives and to be welcomed.

Even the change to the pensions system, giving those reaching their pension more options to decide what to do with their own money, is not to be sniffed at. Although, it occurs to me that the MP who said pensioners were now welcome to blow their pension pots on a Lamborghini if they so choose either has a very inflated idea of the worth of the average pension fund or a very strange notion about how much a Lambo will set you back.

My feeling, for what it’s worth is that, if you retire with enough in your pension pot to buy a Lamborghini, you’re probably far too sensible about money to blow it all.

But there was so much missing from last month’s Budget. Yet again, another year goes by with the UK building industry having to charge VAT at the top whack on RMI work. 5% VAT on gas to heat the home; 20% on installing a new boiler which will heat that house more efficiently. Yes, I know I’ve gone on about it so many times before but, seriously, this makes no sense!!

Yet again, there was nothing to really help push the energy-saving message. We’ve long since realised that Cameron’s claim that his would be the ‘greenest Government ever’ was, at best wistful rhetoric and at worst, complete nonsense.

A one-off reduction in energy bills from cutting eco-levies might sound attractive but the thing about one-offs is that they only happen, well once. After that, what happens is anyone’s guess. Remember when the then Chancellor Norman Lamont took everyone’s poll-tax down by £140 and paid for it with a rise in VAT from 15% to 17.5%? How long did we feel £140 better off for? Until we got the following year’s bill, if memory serves.

We’ve been running a poll on the website about the Budget. When we crunched the numbers, we found that roughly two-thirds of people feel that the Budget didn’t go far enough, though there were some promising elements. The rest, it transpired, were split equally between those who think Osborne’s a genius, and those who think the man’s an idiot.

Still, that’s politics for you.

About Fiona Russell-Horne

Group Managing Editor across the BMJ portfolio.

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