The UK
By Ross Doran
Following a farcical four months of office, not limited to but including; Wes Streeting’s magical weight loss pill, exacerbating child poverty, and slashing fuel payments for the most vulnerable, the budget was somewhat of a positive surprise, with Labour just about able to claim to end austerity.
However, this budget is not an unremitted success. Labour’s economic policy occupies a confused halfway-house. Reeves’ budget simultaneously seeks to rescue Britain’s declining growth, whilst also saving Labour’s sacred but poorly defined”working people.”
The desperate pursuit of growth hinges on attracting business investment to the UK, this has led to Reeves sticking with a 25% corporation tax and, despite raising capital gains tax, both remain among the lowest of the G7. However, the Office for Budget Responsibility (OBR) have indicated that the chancellor’s spending plans hinge on a higher rate of growth than forecasted; the OBR predict growth at 1.6 %. If the OBR are correct, then Reeves’ economic planning is unlikely to deliver substantial dividends.
Additionally, the Centre for Progressive Policy has estimated that Britain needs a huge £140 billion a year to fix the dire state of our public services. The budget promises £70 billion.
Therefore, Labour’s torn priorities, a commitment to being ‘sensible on the economy’ and a supposedly pro-worker party, will likely disappoint both business and workers.
Scotland
By Abigail King
The title of the press brief from the government was: “a Budget to fix the foundations and deliver change for Scotland. “That’s a pretty big claim, but with an extra £3.4 billion in the budget for Scotland, it’s not completely unfounded.
This increase comes after the SNP had to make significant cuts to their budget in September, including to healthcare spending. It also comes alongside a considerable £1.5 billion boost to the Scottish 2024 – 2025 budget. This cash injection brings hope, but it will also really depend upon how the Scottish government divides this money up in its Scottish budget, announced 4 December.
Given previous real-term cuts in healthcare spending, the Scottish government are going to need to bring some intense cash flow into the struggling Scottish NHS and education system.
Windfall tax on oil and gas is going to hurt Scottish oil companies, but it’s also a promising step towards taking climate change seriously.
The SNP have been welcoming of the budget, going so far as to call it a step in the right direction. Investment in public services and spending like there’s no tomorrow are both moves straight out of the SNP’s play book. Let’s just hope Labour doesn’t follow them with shocking returns on investment too.
Students
By Ben Low
We should count ourselves quite lucky; Labour’s new budget is not all that friendly on business or the illusive “working people,” but Reeves has done us students a bit of a solid.
Firstly, for those that work alongside their studies, you might well get a small pay rise. The National Living Wage, that’s the minimum you can be paid over the age of 21, has increased from £11.44 to £12.21 an hour. And for those younger than 21, the National Minimum Wage has gone up from £8.60 to £10. What this means is more money to be spent in the pub. Oh, and Reeves is also slashing draught tax by 1.7% which means cheaper pints!
Although higher education was not explicitly mentioned in Wednesday’s budget, further education and apprentice schemes saw a £340 million investment combined.
But it’s not quite as rosy as it seems. Hiking up Stamp Duty on second homes will hit landlords hard, squeezing the rent market and pushing flat prices even higher. And, although those that have a job might be paid more, the higher rates of National Insurance employers will have to pay will almost certainly disincentivise hiring more part-time staff.
So, taken at face value, the budget is great for young people. But, look a little deeper and those slightly cheaper pints might not taste quite so sweet!
“Keir Starmer and Rachel Reeves Budget prep, London, United Kingdom – 05 March 2024” by keir.starmer.mp is licensed under CC BY-NC-ND 2.0.