Delivering a Budget that was going to please the majority and save the economy was always going to be a pretty tall order. It would take some radical, thinking that took the country by surprise and prove Labour still had some tricks up its sleeve.
Alas, it was not to be. I said before the Budget that Labour’s main aim was to restore a bit of much needed confidence in the taxpayer but they have failed miserably on this point.
I was hoping for something transparent, open and honest. The economy could not be fixed overnight but the country needed some glimmers of hope. Instead, what we have is unbelievably complex, technical and extremely disappointing.
The main point I was hoping the Government would deliver on was pensions. Taxpayer confidence has slowly been eroded over the last few years as they have been left with smaller and smaller pension pots and now the system has changed yet again. It is even more complicated and discriminatory than before. We are going to have our work cut out trying to help sectors such as the self-employed manage a greatly reduced pension.
The complexity of these changes will especially affect those coming up to a year-end as it is the worst time to start implementing changes.
The wealthy have also been hit hard with the new 50p tax rate and the reduction of tax relief. I understand why these measures were taken as they will raise some seriously needed cash but they do not seem well thought out. The plans are massively complex and the rich will pay closer to 60 per cent when all is said and done.
It is here that the Government may have shot itself in the foot. The wealthiest people in the country are best placed to help turn the economy round but there is now a good chance that some of these same people will leave the country for greener pastures.
I do not think there will be a mass exodus – there are always threats to leave when higher tax rates are proposed which tend to come to nothing – but I do think we will slowly but surely see more and more business leaders running their firms from Ireland, the Isle of Man or perhaps even Monaco.
As I said before, the Chancellor could not possibly have pleased everyone with his Budget as the hole we are in is too deep and drastic measures need to be taken to crawl our way out.
The main job of this Budget was to restore some confidence to the public and reassure them that there is light at the end of the tunnel. It has, in fact, done the opposite.
Bruce Wilson is managing director of Helm Godfrey