Chancellor George Osborne has today delivered his fifth Budget at the House of Commons. He announced that the UK economy is forecast to grow 2.7% this year and went on to state that a new £1 coin would be introduced in 2017. Details about public borrowing and the deficit were followed with promises to make a permanent £1bn reduction in government department overspends.
Following yesterday’s announcement of a childcare subsidy scheme, the Chancellor also announced a cap on welfare spending at £119bn for the year 2015-2016. There will also be support for the building of new homes, business rate discounts and changes to taxation. The Chancellor has stated ‘this is a Budget for building a resilient economy. If you’re a maker, a doer or a saver: this Budget is for you’.
In a surprise announcement at the end of his speech, Osborne said cash shares and Isas were to be merged into a single New Isa with an annual tax-free savings limit of £15,000 from 1 July. The limit for Junior Isas will be raised to £4,000. He also outlined a new Pensioner Bond paying market leading rates to be available from January to all people over 65, with interest rates of 2.8% for one-year bonds and 4% for three-year bonds. The cap on the amount of Premium Bonds a person can own will rise from £30,000 to £40,000 in June and £50,000 in 2015. The number of £1m winners will also be doubled.
The chancellor also froze petrol duty, cut bingo tax from 20% to 10%, froze Scotch whisky and cider duty and cut a further 1p from a pint of beer – but put the tax on cigarettes up.
PSI is currently analysing how public services will be affected by this budget.
