It’s touted as the biggest single event of the year affecting your finances, so it’s no wonder that over the last twenty-four hours the main talking point has been the Budget 2017, which was delivered yesterday by Chancellor of the Exchequer, Phillip Hammond.
With issues such as housing, Brexit, and alcohol, tobacco and fuel prices amongst those discussed in Phillip Hammond’s parliamentary address, Way out West, looks at what was said and what it might actually mean.
‘Extra £3bn for Brexit’
Phillip Hammond began his address by saying he would be talking about an economy ‘set on a path to a new relationship with our European Neighbours and a new future outside the European Union. A future that will be full of change, full of new challenges, and above all, full of new opportunities.’
While this positive attitude towards Brexit was to bee expected in such a speech, a key point from the budget for many people will be just how much money Brexit will continue to cost.
We have already almost over 700 million pounds in Brexit preparations, and today I am setting aside over the next two years, another 3 billion pounds, and I stand ready to allocate further sums if and when needed.
‘Revive the dream of home ownership’
Phillip Hammond announced that the government would abolish stamp duty for over 80 per cent of first-time buyers, in a somewhat surprising move that was described as the ‘rabbit out of the hat’ moment of his speech.
But while Hammond’s words might have struck a cord with young people – The chancellor said he wants to ‘revive the dream of home ownership’ – the actual facts may feel less helpful. While the cut in stamp duty will be welcomed by those who are currently in, or close to being in, a position to enter the housing market, it makes little difference for those who are aspiring to do so in the next few years, for whom house prices aren’t going to get any lower, and earning and saving money isn’t likely to get any easier.
— Conservatives (@Conservatives) November 23, 2017
Northern Ireland will get an extra £540m
Northern Ireland will get an extra £540m to spend on infrastructure over the next four years as a result of the Budget; however day-to-day will be reduced in real terms, as although it will be increased by £120m, this is a reduction when inflation is taken into account.
Usually, spending in Northern Ireland is mainly determined by the Barnett Formula, which means that if spending rises or falls on public services in England, it will do so accordingly, and by a proportionate amount, in NI. However this is currently complicated somewhat by the lack of a devolved government in Stormont.
New in this budget was the announcement of a consultation on a city deal for Belfast, which would allow the city to have powers to create economic and business growth, and also decide how public money should be spent. Allow this was welcomed for Belfast, many are frustrated that other parts of Northern Ireland are not treated similarly.
‘Tackling excessive alcohol consumption by the most vulnerable people’
The budget brought mainly good news for alcohol connoisseurs, with wine, whisky and beer getting no more expensive; but the chancellor did pledge to taxes from 2019 on ‘cheap, high strength, low quality’ alcohol, such as white ciders.
Not all cider is being targeted, primarily because of the role cider makers play in rural communities, but the chancellor said the move on higher percentage cider was to tackle ‘excessive consumption by the most vulnerable people’.
His decision reflects the stance from the charity Alcohol Concern, which dubbed white cider ‘heroin’ for alcoholics, and the public health groups report that white cider’s high strength and cheap cost means it appeals to homeless people and the young.
— Martin Lewis (@MartinSLewis) November 22, 2017
Freeze on fuel prices
One of the most noticeable and accessible benefits of the budgets for most people will be the freeze on fuel prices, which will be welcomed by drivers across the UK.
However, as Martin Lewis, the popular money saving expert says ‘the entire budget itself is five hundred pages, and it’s probably going to be this weekend before we actually know what was in it and how it’s going to impact people in the future.’
Just as the way Phillip Hammond’s speech was arguably more concentrated on ideological vision than factual details was to be expected, Labour Leader, Jeremy Corbyn’s reaction to it – he said ‘they call this a budget fit for the future. The reality is, this is a government no longer fit for office.’ – was just as predictable. There respective comments were exactly what was to be expected from politicians in their shoes, but just as we’ll have to wait for all the facts and implications of the budget to emerge, we’ll have to wait a whole lot longer before we know which, if either, of them was right.