Budget 2015 – All smoke and mirrors. And more smoke

The Conservatives are now the party of working people. No, honestly. George Osborne used yesterday’s budget to introduce a living wage, a supertax on the banks and an end to lucrative mortgage relief for buy-to-let landlords. Plus, he’s abolishing non-dom status. So they must be.

“From welfare to work” said the Telegraph; “The Well Fair State” said the Sun; “Pay rises all round” said the Express (while still squeezing a picture of Kate Middleton onto the front page!). It seems we’ve never had it so good.

But in the tradition of all the best stage illusionists, using a little sleight of hand, and a lot of misdirection, Mr Osborne has distracted attention from the less palatable truth.

The ‘living wage’ promised by the Chancellor is not the same as the National Living Wage proposed by the Living Wage Foundation, which is the minimum wage needed for a basic standard of living in the UK. So we will still need to subsidise low-paying employers by topping up their employees’ wages with benefits. And the shiny new ‘living wage’ doesn’t even apply to the under-25s – those who are most likely to be struggling on low wages anyway. The Chancellor’s ‘living wage’ is nothing but a cynical re-branding of the woefully inadequate minimum wage.

The ‘supertax’ on banks’ profits merely replaces the previous levy on all their revenue, which cost them much more. Not so ‘super’ then.

The abolition of mortgage relief for buy-to-let landlords should be nicely offset by the changes in inheritance tax thresholds.

The changes to non-dom status only affect people born in the UK, to UK domiciled parents. A peculiar condition that means wealthy foreign non-doms will still be taxed more favourably than those whose domicile is in the UK.

And if you are poor and young, you will now lose your student maintenance grant – and will have to rack up yet more debt if you want a higher education. If you are disabled, but deemed not quite disabled enough, you will now lose around £30 a week, as you will be downgraded to ordinary jobseeker’s allowance. If you work in the public sector, you will have to make do with a 1% pay rise for the next four years, just as you have for the last three. Given the way inflation is expected to rise, that translates into a pay cut for those on the public payroll. If you are unlucky enough to be born third or fourth into a poorer family after 2017, there will be no more public cash for you.

What about climate change? Surely there must have been some proposals to address that? After all, if we don’t do so, everything else is just shifting the deck chairs on the Titanic.

Well, no. As Green MP Caroline Lucas put it: “There is an enormous climate shaped hole in this budget.”

Instead, we heard confirmation of huge tax breaks to North Sea gas and oil; and bribes, in the form of a sovereign wealth fund, to local communities to accept fracking. And, amazingly, renewable energy firms will no longer be exempt from the Climate Change Levy – a tax that was specifically designed to encourage green power in the first place.

The Chancellor also promised to use reformed car tax (reformed by breaking the link between a car’s carbon emissions and the level of tax) for a new road fund, rather than investment in public transport and making our cities better for walking and cycling.

So there you have it – a master illusionist’s budget, with added woofle dust in the form of increases in pollution and carbon emissions.

This entry was posted in Uncategorized. Bookmark the permalink. Post a comment or leave a trackback: Trackback URL.

Post a Comment

Your email is never published nor shared. Required fields are marked *

You may use these HTML tags and attributes <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

*
*