- George Osborne claims that the British economy is "walking tall again"
- Income tax cut for 27 million, but £12bn more in welfare cuts on their way
- New raid on banks to bring in over £5bn
- Tax break for struggling North Sea oil firms
- Ed Miliband calls it "a budget people won't believe"
- OBR growth forecasts: 2015 - 2.5%; 2016 - 2.3%; 2017 - 2.3%; 2018 - 2.3%; 2019 - 2.4%
- Inflation predicted to sink to just 0.2% in 2015
It was a budget that gave a bit of something to everyone. There was the income tax cut for 27 million people. There was the tax break for the North Sea oil industry, which is struggling with falling oil prices. There was the infrastructure spending committed to the "Northern Powerhouse". Savers will get the first £1,000 they put away tax free, pulling 95% of them out of savings tax altogether. First time buyers will get their mortgage deposits subsidised by the government, which will add 25% to whatever they put away. Small firms have been promised a long-overdue review of the punitive business rates system. He targeted the bankers - always a popular measure outside of the City of London - by hiking the bank levy.
It was very much an election budget - which is convenient, because there is a general election coming up - and packed with giveaways. But without necessarily giving anything away. None of the spending, claims Osborne, is unfunded. And he did not divert from his main path: that of austerity. There would be billions of pounds more in cuts to public spending, notably a further £12bn off the welfare budget, which will squeeze further the incomes of the poorest.
The headline economic figures look good. The employment rate has hit a record high. The economy will grow at the fastest rate in the developed Western world. The claimant count is tumbling. The deficit will be erased by 2018/19, when there will be a £7bn surplus (though this is lower than the £23bn forecast beforehand). And debt will start falling in the same year as attention can be turned to paying it off.
Labour was unconvinced. Ed Miliband, the Labour leader, called it "a budget people won't believe". He said incomes are still falling and people have been made worse off by the coalition government and that it has exacerbated the "cost of living crisis".
But the stage has been set for the election with this budget. Osborne painted a picture of an economy on the mend, one that creates opportunity and rewards those who work hard. The plan may be tough, but it is working, he says, and they are creating a sustainable economy for the future.
Nonsense, says Miliband and Labour. There may be a recovery, but it is being felt by the few at the top, not the many at the bottom. Household incomes are still weak. There aren't enough quality jobs around. The austerity has gone too far and too fast, actually harming the recovery rather than helping it. And the government is ignoring the real picture in the economy, one of food banks, zero hours contracts and inequality - all the while they cut tax for millionaires.
The public can decide who they believe on May 7...
Things have quietened down again now after the budget announcement. Behind the scenes, the wonks will be hunched over reams of statistics and data from the Treasury and OBR, scrutinising every last decimal point. They'll undoubtedly have more to say tomorrow. Until then, thanks for reading IBTimes UK's live coverage of the 2015 budget.
If you want more, take a look around our site where you'll find up-to-the minute news and analysis.
Our last clip from William Keegan - it's falling oil prices that'll help the squeeze on incomes, not Osborne's policies.
While Ukip attacks Osborne over immigration and the labour market, our chief economics commentator William Keegan sings immigration's praises.
Ukip leader Nigel Farage has put down his pint (now a penny cheaper, cheers George) and given his take on the budget.
This government has evidently failed in its promise to the British people to eradicate the deficit and whilst it took Labour 13 years to double the debt this government has done it in five. Mr Osborne talks about a long-term economic plan, today he pushed all his targets back and created a long grass economic plan.
Ukip economic spokesman Patrick O'Flynn added:
Yet again we have witnessed the spectacle of a Chancellor entirely ignoring the impact of unlimited immigration on the wages and employment prospects for working people.
Mr Osborne likes to boast about his long-term economic plan. But it is obvious that he has no plan whatsoever to bring rises in real wages within reach for working families after many years of decline.
Looks like George has won himself a fan. I wonder what he thinks of her?
Keegan's back. This time he's talking pensions.
The Treasury looks at how its budget policies will affect the different income groups. In cash terms, the poorest fifth of British people will be £466 a year worse off in 2015/16, primarily because of the cuts to welfare.
But the richest fifth will see a bigger drop in their income. According to the Treasury, they will be £1,977 worse off because of changes to tax, welfare and public services. When you look at all households together, we're £544 worse off.
At least he clipped a penny off the tax on pints and 2% off duty on spirits. Cheers George.
Cryptocurrency news from our technology reporter Anthony Cuthbertson:
The UK government has announced as part of its 2015 budget that it will be investing £10m into a research initiative looking at bitcoin and other digital currencies.
The announcement follows a call for information about digital currencies in November 2014 and forms part of a major new report - revealed by IBTimes UK - that also provides regulatory clarity and legitimacy to digital currencies, specifically around anti-money laundering requirements.
Read the full story.
This is a worry. The Institute for Public Policy Research (IPPR) points out that household debt will soon be bigger than it was before the financial crisis, when measured as a proportion of household income.
Tony Dolphin, the IPPR's chief economist, said:
The OBR forecasts that household debt will soar to a record 171% of income by 2019, surpassing the 168% peak in 2008. This is more plausible than its export and investment forecasts, though it would require a change in trend from the last few years, when the debt ratio has been moving slightly downward. But this would be a highly undesirable outcome: that households could have more debt, relative to income, by the end of the decade than they had when the financial crisis hit.
But Dolphin thinks there is some creative accounting going on:
The OBR makes these assumptions because this is the only way it can make its forecasts add up, given the path chosen by the government for its own spending. Because the government plans to make substantial cuts to its spending over the next few years, other elements of demand have to grow strongly to compensate if the economy is to grow by almost 2.5% a year.
And the OBR has to forecast growth at this level, because if it is any weaker, a shortfall in revenues will make it impossible for the government to achieve its deficit target. The OBR's forecast, therefore, should be seen not as the most likely outcome for the economy, but rather as an outcome that would allow the government to achieve its deficit reduction target.
William Keegan again, this time on the Lib Dems' discomfort as Osborne delivered the coalition's budget. Sitting beside the Conservatives, they looked yellower than ever.
This is a table from the OBR's latest forecast, which shows the rate of growth expected across different parts of the economy. One big positive: after so many years of a real terms fall in wages, with inflation outstripping pay, that lost ground is being made back up again. And 2015 will be a bumper year for real pay, with average earnings rising by 2.3% and consume price index inflation growing by just 0.2%.
Ian Stewart, chief economist at Deloitte, says there is room for manoeuvre on public spending, but a squeeze is still ahead:
Mr Osborne is offering a vision for the next Parliament of rising incomes, falling debt and a little less austerity.
Today's tax changes are too small to have anyone scrambling to change their forecasts for GDP growth. The really big change is in a significant easing of fiscal policy in the last year of the next Parliament.
Mr Osborne plans to trim £16 billion off his planned budget surplus, which will enable him to eliminate the deficit and ease up on austerity in five years' time. Mr Osborne says the share of GDP accounted for by public spending, rather than dropping to the lowest levels since 1938/39, will return to 1999/2000 levels.
The austerity ahead looks a bit less intimidating. But that doesn't detract from the fact that, whatever happens on 7th May, a major squeeze on public spending lies ahead.
One of Osborne's big plays was a new raid on banks. He is raising the bank levy to 0.21% and says it'll bring in an extra £4.4bn. But will it? There is uncertainty and risk abound. Read our report for more.
Comments in from Natalie Bennett, leader of the Green party. She's no fan of Osborne's austerity:
This final coalition budget offers little hope to the many millions of people across Britain who are struggling to get by. Austerity economics has failed.
Incomes are still lower than they were in 2010, household debt is up and inequality continues to plague this country. In the world's sixth-biggest economy, people should not have to queue at food banks or work in insecure jobs that don't pay enough to get by on.
We need to see a radical departure away from the kind of business-as-usual economics on display in today's budget. That means building an economy that works for the common good, an economy that pays people a Living Wage, protects our public services and invests in renewable technologies that cut fuel bills and help combat climate change.
Our economics commentator William Keegan takes us through the difference between debt and deficit, just in case you were struggling to get your head around it.
Buried deep in the OBR's report, published alongside the budget, is a grumble about the time it was given to scrutinise the costings in George Osborne's budget - i.e. not much. Is there a row brewing between the Treasury and its independent watchdog?
William Keegan adds of Miliband's speech that it was a "spirited response to Osborne's budget":
Business seems to be backing the Osborne budget, with CBI Director-General John Cridland saying it put the country on a path towards growth.
"Stability and consistency are what businesses need to grow and prosper. This Budget sets the tone, providing a clear plan for fiscal health and growth," Cridland said.
"This Budget has some encouraging measures to help businesses create jobs for the benefit of all.
"The brighter fiscal picture has allowed the Chancellor to recalibrate his deficit reduction plans. In the next Parliament this fiscal breathing space should be used to achieve intelligent reductions in public spending, together with much-needed infrastructure and innovation.
"With business investment a crucial driver of growth, the Chancellor has signalled his intention to continue the Annual Investment Allowance. We want it to be made permanent in the Autumn Statement at £250,000 - this will fire the UK's economic kiln by spurring smaller firms to invest in plant and machinery.
"The reduction of the headline rate of Corporation Tax to 20% next month, is a meaningful step in making the UK the most competitive tax regime in the G20 and will help to attract investment.
Cridland highlighted the decision to reduce the supplementary charge faced by North Sea oil and gas companies as a way of restoring the beleaguered industry after oil prices plummeted and said pension reforms would allow "breathing space" for the industry as consumers "get to grips with all the changes".
One surprise omission in the budget was the reported increase in the inheritance tax threshold.
Osborne said he would "conduct a review on the avoidance of inheritance tax through the use of deeds of variation" and report back in the Autumn.
"The budget was remarkably quiet on the much talked about - but seemingly inaccurate - suggestion of an increase in the Inheritance Tax threshold," said Robert Brodrick, partner at Payne Hicks Beach, the private and commercial legal advice specialist.
"This remains frozen at £325,000, where it has been for the last 6 years. Instead, the government announced a review into the use of deeds of variation for tax purposes. I think the message has to be watch this space until after the election."
Economist William Keegan told IBTimes UK Osborne was firing the opening shots of the election campaign in earnest at the dispatch box today:
Following today's projections, Paul Johnson, of the Institute for Fiscal Studies, has hinted there could be an end to austerity in sight.
"There was a noticeable change of tone on austerity," he told the BBC.
"Not much will change over the next couple of years. But the chancellor has reserved substantially what might happen in the long run.
He says that austerity could be stopped in the years 2018/19. It's theoretical, as it four or five years down the line. But it's an indication of the future direction."
But the Chancellor says the country is on the right track:
Miliband's response was laced with attacks on the government's record over the past five years.
He said: "Never has the gap between the Chancellor's rhetoric and the reality of people's lives been greater than it was today.
"This is a budget people won't believe from a government that's not on their side because of their record, because of their instincts, because of their plans for the future and because of a budget that, most extraordinarily, had no mention of investment in our NHS and our vital public services.
"It's a budget people won't believe, from a government they don't trust.
"This Chancellor has failed the working families of Britain. For the first time since the 1920s, people are earning less at the end of a government than they were at the beginning."
"It's a recovery for the few from the government of the few."