The Great Debate UK
from UK News:
So how was it for you?
Chancellor Alistair Darling threw the dice in his pre-budget report in an attempt to bolster Labour's chances of winning the general election in 2010.
From hitting bankers with a one-off bonus tax to lowering bingo duty, Darling played to the Labour heartlands, while hoping to win back voters who have been telling pollsters that they are done with Gordon Brown.
Other measures included the return of full value added tax in January, a 2.5 percent rise in the basic state pension, a 1.5 percent increase in child benefit, as well as help for small businesses and various initiatives to boost the government’s green credentials.
All this while admitting that the recession was worse than he had predicted, with the economy shrinking by 4.75 percent in 2009.
-Julia Whittle is principal and head of international, Punter Southall Financial Management. She will participate in a Reuters pre-budget live blog on Dec. 9, at 12 p.m. British time. The opinions expressed are her own.-
The attack on high earners has probably not reached a pinnacle and those earning above £100,000 have reason to be nervous in this current climate. The Pre-Budget statement so close to an election shouldn’t produce anything too drastic as there is little time to implement anything radical or complicated. However an attempt at some “vote winners” is a distinct possibility.
-Danny Wootton is UK Innovation Director at Logica. He will participate in a Reuters pre-budget live blog on Dec. 9, at 12 p.m. British time. The opinions expressed are his own. -
The importance of innovation to PLCs and individual companies while the economy is in recession is relatively well understood. Recent research has shown that innovation funding has either remained protected or increased through this period.
-Joe White is chief operating officer at Gandi, an Internet domain name registration firm. He will participate in a Reuters pre-budget live blog on Dec. 9, at 12 p.m. British time. The opinions expressed are his own.-
The pre-budget speech will primarily be about two things: reducing the size of the national deficit, and drawing the political battle lines around the economy for the general election.
Alistair Darling is facing the most difficult set of economic circumstances for any chancellor since the 1940s, with the projected substantial fiscal deficits for 2009 – 2010 and 2010 – 2011 likely to be revised upwards from 175 billion pounds to well in excess of 200 billion pounds. He must perform a delicate balancing act to secure the confidence of the global financial markets while protecting any fragile economic recovery and boosting public confidence.
Mark Schofield is a tax partner at PricewaterhouseCoopers LLP. The views expressed are his own.
There were a number of initiatives unveiled to kick start the UK economy which will increase the budget deficit for 2009/2010 to £118 billion. The Chancellor assured the House of Commons that finances would be back in balance by 2013/14 at which point the country “will only be borrowing to fund investment”. By that year the net UK government debt will be over £1 trillion representing 57.4% of GDP, compared with an estimate of £602 billion, 39.4%, for 2008/9.
Roger Bootle is economic adviser to Deloitte. The views expressed are his own.
The Chancellor was right to try to give some help to the economy but, while the scale of the increase in future borrowing is huge, the economic effect of the reduction in VAT will be tiny.
The size of the PBR package, about £9 billion this year, rising to £16bn next year, was roughly equal to what had been mooted in the media. But the scale of the measures, although they sound large, is in fact small.
from UK News:
He cut VAT to 15 from 17.5 percent just in time for Christmas shopping -- a move he said would put some 12.5 billion pounds in consumers' pockets over 13 months. Other measures include well-leaked plans to help homeowners, small businesses, parents and pensioners.