Budget 2014: Osborne's savings surprise
- 19 March 2014
- From the section UK Politics
Stand by for a surprise the chancellor's advisers told us. And a surprise there certainly was.
Help for savers - not, as most predicted, income tax payers - was the rabbit hidden in the chancellor's Budget box.
People will be able to save more tax-free - up to £15,000 a year. Pensioners will be able to buy new bonds that pay them more than they get at the bank and they will be able to get their hands on the cash they saved rather than having it locked away in complex savings products.
Reforming the "broken annuities market" may win Labour's support.
That, after all, was the phrase Rachel Reeves, the party's welfare spokesperson, used in a speech recently attacking the "complex, confusing and uncompetitive" way the pensions market now works.
Politically these measures have one target - older voters with savings, many of whom will be 40p tax rate payers. A higher proportion of them will, I suspect, be Tory voters or disgruntled ex-Tory voters.
It seems clear that that was what the Tories got back from the Liberal Democrats for agreeing to another costly increase in the personal tax allowance.
There too were populist measures guaranteed a tabloid headline or two - a penny off a pint and the halving of the tax on bingo.
Business got help with their energy bills, schemes, tax breaks and incentives to encourage them to invest and export.
All of it paid for by another tighter squeeze on departmental budgets.
This was a budget whose measures were carefully chosen and calibrated by George Osborne with the next general election in mind.
To which people may say "surprise, surprise".