@Ed_Miliband: The unfairness and wrong priorities of the budget: Dc promised to improve work incentives. P 69 of red book shows they will get far worse.
@EdBallsMP: Who said in May 2009 about VAT: “it’s very regressive, it hits the poorest the hardest. It does, I absolutely promise you.”? David Cameron
@dianeforleader: Just came out of Lib Con Chancellor George “Slasher” Osborne’s budget speech. Tories euphoric but Libs look sick as parrots.
Sally Keeble’s verdict, 14.03: A viciously regressive, political budget designed to squeeze the poor, shrink the state, and produce a budget surplus in time for the next election. So much for the new politics.
Sally Keeble, 13.53: Adam Tyrle, the new Tory chair of the Treasury Select Committee, points to the Japanese threat from the cuts – a stagnant economy. Too right.
13.49: @gleniswillmott: Harriet Harman: “The Lib Dems used to stand up for peoples’ jobs, now they just stand up for their own.” She’s absolutely right. #junebudget
Sally Keeble, 13.42: Labour support for the bank levy and cuts in personal allowances – it’s good that Harriet has taken these lines, but pointed out the caveats.
13.42: @wesstreeting: Harriet is socking it to the Yellow Tories.
Sally Keeble, 13.41: Harriet makes a really strong attack on the Lib Dems: 22 ministerial jobs have been bought with cuts to so many people’s jobs and benefits. This one will hang round their neck.
Switch from national treasury to treasury poodle – Vince Cable live that down!
13.38: @jamesdeeming: Harman: “Greece is not an alibi… Canada helped by strong growth in main export market of America” #budget
Sally Keeble, 13.38: Another go at the Lib Dems. Having attacked Tory plans to increase VAT during the elections, the Lib Dems are now voting for it as part of the coalition government.
The switch from taxing income to taxing consumption is regressive, unless there’s a lot more support for low income families.
13.36: @jordannewell: This budget is “the equivalent of putting every man and woman in Coventry out of work”. Well said @HarrietHarman
13.35: @AaronPorter: @HarrietHarman slams the budget as unfair, regressive & targets the poor. #junebudget
Sally Keeble, 13.35: Harriet’s picked up on the purse to wallet switch – cuts in health in pregnancy grant and Sure Start maternity grant, and tax credits as well as the freeze on Child Benefit.
Sally Keeble, 13.34: Harriets’s also doing well in going for George over the growth estimates and jobs. The OBR report will come back to haunt the Tories. As she says, youth unemployment is the big drain for a modern economy.
13:32: @jordannewell: “A sad day for the British people. Prepare for the dole” says economist Danny Blanchflower
Sally Keeble, 13.31: Well done Harriet for sticking the knife in the Lib Dems for going along with the Tories attack on the poor and the public sector.
13.31: @edballsmp: Who said in May 2009 about VAT: “it’s very regressive, it hits the poorest the hardest. It does, I absolutely promise you”? David Cameron
Sally Keeble, 13.29: £150 increase in child element of child tax credits. Let’s see how it works out compared with what Labour was going to do. It looks more like a redistribution of some of the cuts, not a genuine increase. They say they will not increase child poverty, but will they reduce it?
13:28: @DMiliband: A give with one hand punch with the other Budget.
13:26: @Jessica_asato: Relinking the state pension was LABOUR’S policy! It was the Tories who delinked it! Argh! #budget
Richard Angell, 13.26: Labour benches laughs a lot at the idea this is a progressive coalition – progressives don’t increase VAT and freeze child benefit.
Sally Keeble, 13.25: It is absolutely not true that the rich will pay more than the poor.
The poor will lose some of their benefits, have their housing benefit capped, lose their chances of a public sector job, and if they’re children they’ll lose their Child Trust Funds, and have their school’s budget cut.
Some progressive coalition.
Sally Keeble, 13.24: The Tories do not understand targeted benefits. The increase in personal allowances will give people £170 – wiped out by the increase in VAT.
Sally Keeble, 13.21: Increase in capital gains – a fudge for the coalition partners. The Lib Dems didn’t get the reduction in the thresholds they wanted and the increase was not as great for higher earners – 28 per cent.
13:20: Oona_king: Tory Tax Bombshell! And at the same time they’re hammering Mums. Oh the shame of it #budget
Sally Keeble, 13.19: The council tax freeze sounds nice, but because of the way council tax works, this will mean big cuts in local services.
Richard Angell, 13.18: Tories at their most regressive: VAT to 20% – the VAT increase is wrong, unfair and hits the poor most. VAT will put up prices, have inflationary pressures and turn people away from the high street. This one measure could put the recovery at risk the most. Didn’t the Tories deny they had plans to increase VAT?
Sally Keeble, 13.17: After all the hype there’s nothing on tobacco and alcohol. These are big earners, bringing in about £15bn each.
What a concession for the Lib Dems, they’re changing the duty on cider!
Sally Keeble, 13.17: This is the shocker, the increase in VAT to 20 per cent. It will be a big hit on lower income people, costing an estimated £425 a year, that’s on top of the cuts in benefit.
Richard Angell, 13.15: Good to see that Lord Adonis’ infrastructure plans will be kept – about time Birmingham New Street was rebuild. Good news for the Metro in the North East. This is the right thing to do.
Sally Keeble, 13.15: Their big idea for regional development is a switch from public to private sector investment, with more support for transport infrastructure, and the new regional growth funds. Fine – but these regions are going to be very hard hit by the public sector spending cuts, especially hitting employment levels.
Sally Keeble, 13.13: The changes to business taxes generally will be the Tories big idea. But I thought the idea of the green investment bank was ours!
Sally Keeble, 13.11: The levy on banks sounds sensible, a way of putting pressure on banks that engage in more risky lending.
Sally Keeble, 13.10: I thought the Tories said the recession started with the Labour government. At least they now recognise it started with the banks. Progress of sorts.
Sally Keeble, 13.08: Support for small businesses is a real vote winner in middle England.
13.06: @jessica_asato: If anyone ever thought the Tories cared about poverty, this budget surely must show the lie of that #budget
Sally Keeble, 13.06: Let’s also see the changes to Support for Mortgage Interest. This is what has prevented people from losing their homes in the recession. Expect to see a big increase in repossessions if the Tories have got this wrong.
Sally Keeble, 13.05: The tax credit cuts will have lots of unintended consequences. The rule on benefits is they can be backdated for three months, so this is a cruel change. No mention of the childcare element – I suspect that’s in the small print.
Not much on disregards, and those are also important, especially for people who are also on housing benefit. Talking of which, where are the Tories living? The caps on housing benefit are not realistic for people living in the south east, or even in the Midlands.
13.03: @Jessica_Asato: Lost for words at freezing child benefit for 3 years. This is a budget which hurts children – the most vulnerable in our society. Disgusted.
13.01: @BeccaHutson: #budget this is regressive coalition, slashers budget & officially a rich man’s world. Poorest children paying price for the richest mistakes.
Richard Angell, 12.55: Selling off the student loan book will lead to funding short falls in the years to come. Labour were wrong to attempt this, stopped because if failed to offer value for money to the tax payer and could even increase the debt in the long term.
Sally Keeble, 12.55: The switch on pensions is not helpful – CPI is less volatile than RPI, but is also very often lower.
The big one on tax credits:
-Much more severe than was expected. Households earning under £40,000 are not high earning.
-The freeze on child benefit is exactly what the Tories did last time, and that was the single biggest factor that led to the large increase in child poverty. What a throwback to Thatcherite Britain.
12:59: @Neiley83: I wonder how many Lib Dem MPs are sitting there thinking “there goes my seat at the next election”
Sally Keeble, 12.55: Some help for the low paid in the public sector. £250 increase a year. It’s better than a freeze, but not much. People will need their tax credits.
Sally Keeble, 12.54: The commitment on DFID can mean anything. “We will honour our obligations” can mean we will do the ) 0.7 per cent but no more, and then redefine what qualifies as aid.
Sally Keeble, 12.53: George says he won’t cut capital spending – we had already done that, and were planning the sale of the student loan book.
Quarter of all spending to be cut apart from NHS and DFID, that is where the real damage will come. Especially as education will be given some protection, putting the real pressure on to the welfare state, and local government.
12.51: @bevaniteellie: Lib Dems have given in to 77:23 ratio: weak, stupid and dangerous. We should never forget. #budget
Sally Keeble, 12.48: The budget surplus by the end of this parliament will allow for a spending spree in time for the next election.
The reduction in the deficit is where we and the Tories differ. Alistair was absolutely right not to go for such a sharp deficit reduction. Much of the deficit was due to the slowdown in the economy, which is why we went for growth as a key part of dealing with the deficit.
12.45: @RoMarcelinHorne: 80/20 rule ignores growth and that is the true way to be progressive George #budget #labour
Sally Keeble, 12.45: The reduction in the growth figures are unjustified, based on assessments of spare capacity in the economy. The increases in interest rates were predicted well before the elections, and were built into all the Bank of England estimates.
Now the core of the budget is coming, the massive cuts in spending – for 77 per cent of the deficit reduction to come through cuts.
12.42: @labourpress: Osborne just confirmed that growth forecast lower in 2010 and 2011 under Tory plans than under Labour (2.3 down from 2.6 next year)
Richard Angell, 12.41: Osborne says he wants to end the over reliance on the banking and diversify the economy. How does cutting the £80m loan to Sheffield Forgemasters help diversify the economy and support manufacturing? See piece by Pat McFadden MP here.
12.40: @JamesAnthonyRN: Surely removing the defecit in 5 years is unnecessary? #budget
Sally Keeble, 12.40: The markets had held up remarkably well under Labour, with continued bouyant gilt sales. George is keeping up his track record of talking down the UK economy.
The Office for Budget Responsibility will only be as good as its ground rules, and it changed those dramatically to suit the Tories. This is the Tories’ version of “Prudence.”
12.32: @wdjstraw: Outrageous of Sky News to have a misleading “Total UK debt” ticker on screen. Did Osborne ask them to put it up?
12:32: @stellacreasy: Now in chamber waiting to hear Budget- out of interest who living in London thinks a family income of £25k is wealthy apart from lib dems?
Sally Keeble, 12.18: The Tories are expected to change aviation tax to levy per plane rather than per passenger. This scores very well for the green policy, but badly for the air freight industry. East Midlands airport is the second biggest freight airport in the UK, so a key player in the midlands economy will be upset. It’s something that Labour tried several years ago, but backed down in the face of strong opposition.
Sally Keeble, 12.07: The increase in the tax personal allowance will give the average tax payer £200 a year.
The cost of the predicted VAT rise will cost the average family about £400 a year.
Sally Keeble 12.03: Things to watch out for:
-The Tories have promised to protect children and pensioners. That’s a bit rich coming from George Osborne.
Child Trust Funds – one of the best taken up benefits that provides for some kind of an asset base for the poorest children – have already gone.
-Child Tax Credits have proved easily the best way to tackle child poverty, which is why the Labour Government rightly built them up. I would have preferred to have seen Alistair Darling increase child tax credits rather than cut VAT last autumn. So the widely expected cut in child tax credits will be a major blow for everyone who wants to see a reduction in child poverty.
-Also watch for a cut in the childcare element of tax credits. This provides £175 a week for childcare for your first child.
-On pensioners watch for cuts in special benefits for 60 to 65 year olds, like winter fuel allowance. That will be another purse to wallet measure. It will affect women pensioners, who are much more likely than men to be poor. Both the Tories and Lib Dems have complained about pension credit – Yes, it’s a complicated benefit, but changes in this can affect disabled pensioners and carers.
12.02: @davesusetty: To save money the #Budget will probably have lots of 2-4-1 offers in the public sector. Like “Where there were 2 jobs, there will now be 1.”
11.58: @cornagain: Our popcorn already carries VAT. Hope the #Budget doesn’t kill our business before we’ve really started.
11.56: @GdnPolitics: RT @hmtreasury: George Osborne has arrived at Parliament to deliver his Budget statement at 12.30pm #budget
Sally Keeble, 11:55: It’s good to see the Financial Times is taking the same line as me on the Office of Budget Responsibility’s approach to spare capacity and the output gap.
The change in the calculation underpins the changes in the estimate of growth, and that is what is driving a lot of the budget measures. Alistair Darling had charted a course for managing down the deficit while focusing on growth, and the Tories have now changed the basic rules.
Using one of the more nebulous theoretical concepts to justify budget cuts is particularly cruel. Expect to see the output gap change again when it suits the Tories’ political purposes – probably in the run up to the next General Election.
11:26: @dmiliband: Clegg says Lib Dem values will be stamped on Budget. Yes – opportunism and double dealing.