I was going to start this piece by saying that as George Osborne stood to present his 4th Budget all the smart money was on a Budget with very little drama as, quite simply, he had no room for manoeuvre.
As it happens, it was not just the smart money that should have been placed on that outcome as, before the Chancellor delivered his Budget the main points were available online courtesy of the London Evening Standard.
Regardless, given that the Chancellor has been unequivocal that he will not borrow more to spend more, the die was cast. So with such little room for action what we got were a handful of policies to be paid for by further public sector cuts.
Small businesses will welcome the fact that they will get a rebate for the first £2,000 of their employer national insurance liability from April 2014. It is estimated that 98% of the benefit of this measure will go to the smallest employers
Individuals will welcome the increase in personal allowance to £10,000 in April 2014 – albeit that the benefit of this will not apply to all, as the basic rate band has been reduced in order to wipe out the benefit for a 40% tax payer (and of course those earning over £100,000 do not get a personal allowance anyway).
House building companies will hope that the mortgage guarantee scheme and the introduction of £3.5bn into shared equity loans will be of greater success in kick starting the housing market than the attempts made to date. It seems investors believe it might just work, as share prices in some of the larger companies have risen by 5 – 10% on the news!
The larger, most profitable companies will welcome the commitment to bring the main rate of corporation tax down to 20% in April 2015, and thus align it with the small company rate. Whether the small local company barely turning a profit believes that it should be paying the same rate of tax as the most profitable PLC is another matter. However, since it seems that a fair proportion of the largest companies pay tax at considerably less than 20% there seems little merit in labouring this point.
The Chancellor called it a “Budget for an Aspiration Nation”. There is a certain irony in the fact that the Chancellor would have aspired to do so much more, but like many households in the UK at the moment, he finds he has very little spare cash available for luxuries.