A Budget of paradoxes

George Osborne

Off course, but determined to stick to it. Having no money to spend, but still able to deliver tax cuts for people and businesses. This was a Budget of paradoxes.

George Osborne was forced to read out a grim set of economic forecasts - the missing of his debt target, the halving of next year's growth forecast and borrowing up this year on one measure and only down on another thanks to an unprecedented and surely unrepeatable underspend by Whitehall departments (£7bn more than last year).

However, none of this convinced him to take the advice of those urging him to borrow more in an effort to stimulate growth by cutting taxes or investing in construction.

Nevertheless, the chancellor did find money from squeezing day-to-day spending to pay for important personal and business tax cuts and a multi-billion pound attempt to boost the construction industry.

This was a very political speech from a man in a very tight economic straitjacket: demonstrating a Brown-like determination to keep control of the economic statistics even though they are now drawn up by independent forecasters; echoing Thatcherite rhetoric on home ownership ("Help to Buy" follows "Right to Buy"); boasting that he would be delivering his tax-cutting objectives (20% Corporation Tax rate and £10k personal tax allowance); claiming to have taken out of tax all those who would pay the 10p tax band Labour have talked about restoring; promising a tighter spending round than expected and inviting Labour to tell the electorate which tax rises they'd like instead.

It will, though, not be judged by the headlines or by the measures or even by the Budget leak* but by whether the next time he stands up the economic news appears to be any better or worse - yet again.

* In reality not so much a leak as a breach by the London Evening Standard of an embargoed pre-Budget briefing

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  • rate this

    Comment number 83.

    Frank London-

    A fine example of pitting the poor against the poorer.
    While you have had a 1% pay rise, the front bench's expenses are up by at least a third. Why not moan about the millionaires and billionaires, instead of being happy someone on benefits now worse off...

  • rate this

    Comment number 82.

    Sorry Vampire but I find Nick & co review things well enough Thanks Nick!
    Sadly NONE of our politicians come across as clearly as Nick. THEY are too busy yahooing; blaming everyone else; or scoring political points. Ie business as usual.
    They are all economical with the truth & its difficult to know who to trust so we trust none of them.
    Mmm..What would happen here if they did a "Cyprus"?

  • rate this

    Comment number 81.

    The best way to stimulate the economy is to get people spending. The best way to get people spending is to create jobs so that people earn money. The best way to create jobs is to allow companies to make more money. The best way to allow companies to make more money is to reduce the burden of tax. Reducing corp tax and NI payments is a positive move.

    A good budget in a challenging economy.

  • rate this

    Comment number 80.

    Think I'd be more optimistic if it looked like we'd learned the lessons from the banking crash that got us into this mess in the first place. We're at a place where our society values someone in the City gambling on things that don't really exist more highly than someone rolling up there sleeves and doing something constructive.

  • rate this

    Comment number 79.

    62.david sugars

    Miliband's response a Tour de force


    More of a Tour de farce

  • rate this

    Comment number 78.

    Seems a fair budget, as a NHS worker I get another massive 1% pay increase. But now that is the same as people who can't/won't get a job I don't mind.
    I had a pay freeze under Labour while those on benifits went up 3-4% a year.
    So the last 3 years of Labour my pay went up 0% while those not working went up 12%.
    Yet the unions still claim Labour as the party for the workers.

  • rate this

    Comment number 77.

    Being from the brewing capital of Burton I thought I would be happy about beer duty reductions to help my local economy, but then I thought about every single pub beer pump price and the last figure is invariably a 0 or a 5 so how will a 1p price reduction be applied?

  • rate this

    Comment number 76.

    I really do not understand the fickle UK people. Regardless of who's in, they are all useless. MP = never worked in the real world useless liars, self greed that take take take.....Please wake up and lets fight to remove ALL, Lords, MP's and change the way this country is Governed.

  • rate this

    Comment number 75.

    The halving of the growth forecast is for this year (2013, calendar year) not next.

  • rate this

    Comment number 74.

    @62 It's spelt .......farce.......

    Nothing at all, certainly nothing new.... Only irony, and panto dame antics and a screechy voice. So much for an out of touch, never experienced the real world professional politico.

  • rate this

    Comment number 73.

    As someone who has made lifestyle decisions to drive as little as possible - live in town, cycle most journeys - why do I still have to subsidise private motor vehicle usage which hurts the environment, kills thousands annually and generally clutters up our streets.

    My local services are being cut while Osborne keeps bending over for the motoring lobby. He should spend on cycle infrastructure.

  • rate this

    Comment number 72.

    24 Minutes ago
    It is going to be a hard slog. No place for scroungers, so expect street demonstrations from the unwashed and lazy


    Maybe they are unwashed because they can't afford hot water?

    Maybe they are out of work due to flexible labour markets and not becuase they are lazy?

  • rate this

    Comment number 71.

    Let's face it - these are difficult times to be Chancellor. I don't think GO had any choice - if he gave into the demands to increase borrowing, Labour would no doubt have a go at him for a u-turn, and the almighty markets probably wouldn't be impressed either. All he can do is tinker around the edges and wait the storm out.

  • rate this

    Comment number 70.

    I find it bizarre that, despite having a 'leaked' copy of the Standard, that Ed Milliband still came across like an argumentative, broken record. Yes, the plans hadn't worked so far - but I think the measures taken by the Chancellor highlight that more needed to be done to get people and businesses working and spending.

  • rate this

    Comment number 69.

    Great news for alcoholics.

  • rate this

    Comment number 68.

    What's to say?
    Very little really, a few idle boasts about his Dad being better than my Dad?
    He is going to cancel the fuel escalator that the tories inherited from labour who inherited it from the tories.
    Alcohol abuse? Sorted,done away with another escalator and made beer cheaper.The AA will go out of business.
    It really is sad that a man with his education comes up with nothing better .

  • rate this

    Comment number 67.

    Should have read #17
    Why pedalling Ed Balls rubbish about a tax cut for millionaires? This is a lie that Ed Balls thinks if you keep saying it then it becomes fact. An article in Sunday Times at weekend from OFR showed the group with the biggest tax hike from Tories in last 3 years are millionaires followed by the poorest. If want to moan then target the middle classes - they are least affected.

  • rate this

    Comment number 66.

    Nick Robinson, must you put a negative slant on everything the tories do?

  • rate this

    Comment number 65.

    Where were these moaners about Labour when they got rich from 1997-2007 ? Wages up, House prices up, unemployment at record lows, we were all in clover, don't recall many complaining then.

    As soon as it goes bottom over breast with Bankers gambling once too often and you start to suffer a bit, it is Labours fault. Get real, it was not Labour or ConDems fault, but Osborne has had long enough.

  • rate this

    Comment number 64.

    Well for starters I'd imagine the government would kill to have the figures they inherited in 2010 with decent growth & £240 billion less debt?

    The link included was enough of a clue ... I'd have thought ... but to spel it out read that article?
    I read it - and the comments below. Pity it's garbage. Nice link in the comments to Ed B*lls alleged lies about the deficit.


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