The 2024 Spring Budget: An Analysis

11 Mar

A last ditch attempt by a failing government to appeal to the electorate? Or a genuine attempt by a moderate Conservative to provide extra support to the British people?

What do you think?

For ease, here are the key takeaways from Jeremy Hunt’s 2024 budget:

Reduce national insurance by another 2p. This will cost the government £10billion, but could see a rise in poverty for those who desperately rely on services funded by national insurance. An average worker will find themselves better off by £450 per year.
Fuel prices will be frozen again - this will continue the 5p fuel tax cut that was first introduced in 2011.
The high income child benefit charge will be raised from £50,000 to £60,000 - and it will ‘taper’ until £80,000, so they will gradually lose eligibility for child benefit as their income increases between these brackets.
A £360 million research package to boost manufacturing and the construction of a ‘British ISA’ to boost investment in British businesses.
Intention to crack down on non-domiciled individuals - these are people who work in the UK but officially live abroad. Previously, they did not pay tax on any overseas earnings as this money was protected for 15 years. Hunt has now cut this to 4 years, and it is expected to raise over £2billion a year to fund tax cuts.

So… what’s the verdict?

Ultimately, i’m not sure that this delivers any real and measurable change. Yes, tax cuts sound nice (everyone wants to pay a liiiittle less tax if they can!) but the implications of these tax cuts on public services are categorically not worth it. Couple this with predictions that these tax cuts will be unsustainable, and will need to be reversed after the next General Election, it makes you consider whether this is just another example of political point scoring.

As for the fuel freeze - this is simply not enough. As the cost of living crisis rages, and fuel prices of an average of £1.40 per litre become the norm, the government needed to do better here. Oil giants Shell have recorded bumper profits in the last few years, most recently in excess of £5 billion in the fourth quarter of 2023, totalling in excess of £28billion (yes, that is just PROFIT) in 2023 alone. A windfall tax on these companies is hugely overdue, and something that sadly, doesn’t seem to be on any political parties radars any time soon.

Unfortunately, a very safe and predictable pitch from the Tories. Very safe, nothing new, and certainly nothing radical. But then, this very much fits with the Conservative rhetoric - (see my Conservatism resources!) It will be interesting to see how many of these commitments are long term, and which get scrapped after the local election in May.

What topics can I use this example for?