Will the budget make much difference to our lives?

Updated: 
It was was an eagerly anticipated Budget speech and George Osborne responded with a collection of headline-grabbing measures. But will the announcements ease our pockets and make any real difference to our lives?

Well, of course, it depends on who you are.


The chancellor's Budget package is intended to boost business and make Britain more competitive, jump start consumer confidence, and rein in revenue elsewhere by measures such as closing tax evasion loopholes.


Yet many commentators have already responded to much of the 'populist' Budget as mere gestures, that don't go far enough to help struggling families and combat our deteriorating economy.

Poor are hardest hit
Joanna Elson, chief executive of the Money Advice Trust explains that with the government cutting its growth forecast for the UK economy today, it is clear that we still have a long way to go before many people across the UK start to see a general improvement in their finances.

"Household budgets are being hit from every direction, with increased unemployment, wage growth stagnation and benefit cuts squeezing income; whilst inflation and a potential rise in interest rates hit expenditure," she adds.

Family groups also have slammed the Chancellor's silence on help for disadvantaged and vulnerable families. Helen Dent, chief executive of Family Action, said: "With more than 2.5 million unemployed the Chancellor's silence in this Budget on how he will support the most vulnerable families and children is damning. There's no help in this Budget for them and from April they will be hammered by 16 welfare cuts which we fear could break the vulnerable families we work with."

Mortgage market needs more
Osborne's focus seemed to be on appealing to Britain's 'squeezed middle' with the announcement of help for first-time home-buyers, and a boost for 25 million income tax-payers by raising the threshold on the personal tax allowance to £8,075 by April 2012.

His pledge for first time buyers is to give £250 million to help over 10,000 get on the property ladder with the opportunity to take up a five-year interest free loan, but is it enough?

Robin King, Director of Move with Us thinks the jury is out on whether this new initiative from the Chancellor will be sufficient to really move the market forward, bearing in mind it affects only one part of the market and these people will still need to be assessed for loans.

"At the end of the day, lenders will still hold the keys to unlocking growth in the wider market and we are disappointed that the Chancellor has not tackled lending practices," he added.

Relief at the pumps
The cut in fuel duty is the most headline-grabbing move, as record pump prices are a primary concern for millions of consumers and small businesses. He cut the price of fuel by 1p per litre from 6pm tonight, and delayed the inflation rise in fuel duty planned for next week until 2012.

The fuel duty escalator that adds 1p to fuel duty on top of inflation each year to be canceled for the rest of this parliament. This is a move that we all welcome, but fuel costs remains a huge drain on both household and small business budgets.

Savers lose out
Aside from the welcome news of the new Junior ISA, savers were the noticeable losers of the speech, and we'll continue to battle the evils of low interest rates and rising inflation. In fact, the Chancellor indicated that inflation, as measured by the Consumer Price Index, is likely to remain between 4-5% for the rest of the year.

Individual responsibility
The Chancellor confirmed that in future, given the continuing increases in life expectancy, we will see state pension rise automatically. This move highlights the importance of taking control of our own pension provision to save and provide for the future - because we could be waiting a long time to receive anything from the state.



Latest from our live blog




SPONSORED FINANCIAL CONTENT