Chancellor John Healey's first Budget promises millions of households £100 to help with soaring energy bills and offers high street firms a tax break as they contend with the economic impact of the Iran war.
Healey said he aimed “to steer us through the global economic storms today, to chart a new course for Britain in the years ahead, to give people fresh hope for Britain’s future.”
Key announcements and regional funding
Prime Minister Andy Burnham defended the Budget against claims it is "not bold enough," telling broadcasters: “It’s pretty bold to help 20 million households with energy costs through the council tax cut this winter.” He added it is "bold to lift 70,000 businesses out of business rates altogether, and that will give a real lift to high streets up and down the country."
Burnham also noted the previously announced plan to take VAT off electricity bills, saying: "We’re doing what we can to support people in difficult times, recognising that we don’t have huge room for manoeuvre."
The Chancellor announced several regional investments, including £10 million for a new market hall in Stafford, £10 million for Bristol’s Temple Quarter, £3 million to help Plymouth’s young people get jobs in defence, £15 million to upgrade the Leeds College of Building, £10 million for Bury’s indoor market, £20 million to restore Liverpool’s Littlewoods Building and £3 million for a tech company incubator in the Don Valley. He also said the next International Investment Summit will be hosted in Gateshead in the spring.
Mixed reaction from business groups
Reaction to the Budget has been mixed. Institute for Fiscal Studies (IFS) director Helen Miller said the Budget has “a raft of fiddly measures but very little that will move the dial on growth.” She welcomed the Chancellor’s “commitment to fiscal consolidation” but warned that the plan "has an Achilles’ heel in the form of very tight plans for public service spending."
Rain Newton-Smith, chief executive of the Confederation of British Industry (CBI), said the Budget "does not meet the scale" of the Government’s ambition to boost prosperity. She said: "On the face of it, this Budget lacks the bold moves that would have made it easier for firms to invest, hire and grow."
She welcomed relief for business rates for retail, hospitality and leisure firms but said the Budget "misses the chance to deliver the wholesale reform to the system we desperately need." She added that "there is nothing concrete to provide breathing space for the vast majority of businesses who are already dealing with energy bills a third higher than their European counterparts."
