It’s Budget Day, Wahoo!
24th March 2010
How exciting! Today is the last budget before the long-awaited General Election and hands up who is not excited by the prospect of hanging on our Chancellors’ every word?
Ok, a little bit of sarcasm there, but whilst Mr Darling has stated that it will be a “workmanlike” budget, it could actually be one of his most interesting ones. It is certainly the toughest one he has had to give and getting the balance right will be incredibly tough. On one hand he has to show they can be tough on reducing our ridiculous deficit whilst not snuffing out signs of recovery and, on the other, election sweet talking.
So what could we possibly see? The first thing that many of us are hoping for is a long-overdue change to stamp duty which could mean the scrapping of stamp duty below £250,000. If this were to finally happen it would provide a nice boost to the housing market and you will hear the audible sighs of relief from beleaguered 1st Time buyers who have not had a great deal to crow about in recent years.
No doubt there will be a lot of talk around the fact that public borrowing has come in below target, though what’s £10 billion or so between friends? However a deficit of around 12.6% of GDP this year, against an EU target of 3%, means that there has to be some kind of detail around how they are going to reduce this and the City will be analysing every word closely.
As Lib Dem celebrity Vince Cable said yesterday, “One of the key tests of the government tomorrow is whether they are willing to be specific, willing to be open about what they are going to cut.”
Mm, I am still waiting for either of the main parties to be specific about this so I would not get too excited!
Other notable items will probably include the expected announcement that Government backed banks will be “made” to increase lending to individuals and businesses by around £100 billion this year. This is good news as long as the lenders channel this into the right places and it will be interesting to see the effects of this.
Other banking moves could include a welcome move to make bank accounts more accessible to all, a Green bank to invest in low-carbon projects, and some kind of further levy on banks for being so naughty could also appear.
ISA savings limits are likely to rise as well and, of course, if you drink and smoke I would start now!
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Andrew Montlake, Director and Spokesperson for Coreco, gives his honest and forthright views on the mortgage market, economy and all things property related. Monty was voted "Mortgage Personality of the year 2008", "Best Press Spokesperson" in 2011 and is the current holder of the British Mortgage Awards “Best Marketeer” title. Expect expert analysis, delivered in a down to earth style with a side helping of exuberance.