In a Tribune website first, Emma Kelly will be blogging on George Osborne’s budget of cuts, with a bit of help from Rene Lavanchy. Refresh the page to see the latest updates.
The Institute for Fiscal Studies has calculated that Osborne plans to cut £85 billion – this is a sharp rise compared to the £50b set out by Alistair Darling before the election.- EK
12:37- Osborne has left little doubt over who is to blame for the crisis, he keeps blaming Labour, whereas the banks haven’t been criticised at all. He repeats the mantra of “we’re all in this together” – a sign of the deep cuts coming up?- EK
12:43- 77% through cuts 23% through tax rises – slightly less than the £4 of cuts for every £1 of tax rises – EK
12:56- Public sector workers will have to suffer a pay freeze which will no last 2 years rather than 1. Workers who earn less than £21,000 will, however, gain a pay rise of £250. – EK
1:01- Osborne is slashing tax credits. Sure start will now only be available for the 1st child and child benefits will be frozen for the next 3 years.- EK
1:09- Did Osborne just say “failure of the banks”?? – EK
1:15- Corporation tax will be cut by 1p every year for 4 years, that means it will drop from 28% to 24%. This will be one the lowest in the G20.- EK
13:19 Osborne has announced a banking levy from January 2011 expected to bring in £2 billion eventually. He also announces a regional capital fund and mentions several transport projects – when he said “Tyne and Wear” it seemed he’d say “tunnel”, but no, he’s talking about upgrading Tyne and Wear Metro. So will that tunnel get upgraded or not, and what about the A19 link road? RL
New Deputy Speaker Lindsay Hoyle has to intervene for the first time after Osborne announces VAT is going up to 20 per cent. The chamber is in uproar. “Order! Order!” he cries. “Can honourable members calm down… the country takes this budget very seriously, so can I call for more calm.” Osborne calls the rise “unavoidable” due to the last government’s debt. RL
1:27- Osborne wants to relink the basic state pension and earnings. He takes a shot a Brown promising there will be no more 75p rises in the pension rate.- EK
1:29 The budget ends, there were big cuts for corporations and small businesses. Harman is now responding, claiming growth people out of work.- EK
1:37 Harman says that the cuts in the budget will lead to job losses “on the scale of putting every man and woman in the city of Coventry out of work.” Presumably she’s talking about Coventry’s total population of about 305,000. Her sources seem to include International Labour Organisation research. RL
13:40 Harman commits to supporting the banking levy and the £1000 rise in personal income tax allowances, but says that with a 20 per cent cut in VAT, voters “will feel short changed”. RL
The negative reaction to Osborne’s VAT hike will no doubt bolster the position of leadership hopeful Ed Balls, who recently said that Labour’s failure to rule out a VAT rise helped them lose the election. RL
13:47 TUC general secertary Brendan Barber’s pronouncements have been less positive since the election, and this one is no different. The latest press release has him saying:
“This Budget was economically dangerous and socially divisive. The one thing we can now say is that we are very definitely not all in this together. Those on middle and low incomes have done worse than expected, and the rich have been let off much of what they feared. But we will all suffer from an economy that is now likely to be sluggish at best and with a double-dip recession at worst.”
That’s all for the Budget live blog. RL