Wednesday, November 26, 2008

Stealth cuts and a missed opportunity

The Institute for Fiscal Studies, a respected independent financial think-tank, has looked at the small print of Alistair Darling's pre-budget thinking. It has detected built-in £37bn cuts in frontline public services. This puts in the shade the £20bn which Labour falsely accuses us of intending to cut.

Given the increased borrowing and these cuts, you would have thought that he would have made good use of the money. The Liberal Democrat verdict on the Labour Chancellor’s Crisis
budget is: a missed opportunity.

He could have made tax fairer for everyone by cutting income tax for low and middle income people, by closing loopholes for the rich.

BUT he chose a temporary reduction in the top rate of VAT. That doesn’t make food or fuel or children’s clothes cheaper. It does make it harder for small businesses who have to change their pricing and VAT accounts twice. All it does is help the “big spenders”.

Where’s the fairness in that Mr Brown ? Where’s the help for struggling residents here ?


Aberavon and Neath Liberal Democrats said...

Further back-tracking: Darling, having indicated earlier that he would scrap Air Passenger Duty, has decided to stick with it, but increase the bands from two to four. A per-flight tax, promoted by the Liberal Democrats and green groups, would have almost certainly have attracted all-party support and would have encouraged better fuel use by airlines. It would also have been simpler to administer.

Instead, Mr Darling has opted to make APD more complicated. Well, it makes more work for civil servants.

Frank Little said...

Simon Calder, in his "Independent" column suggests the reason for the Chancellor overruling the Treasury on APD: he wants cheap holiday flights to continue.