Overall, this isn’t a “lower tax” budget.
There are some tax cuts, worth £24.6bn in total over this parliament. The big giveaways are: cuts to corporation tax rates; raising the tax-free personal allowance; extending inheritance tax relief.
But these are wiped out by £47.2bn of tax raises – on dividends, insurance premiums, vehicle excise duty and pension tax relief among others.
So the chancellor giveth with one hand and taketh away about twice as much the other. It’s a net tax-raising budget.
There’s at least one group of people who may well disagree with that: the young.
We’ll have to wait for a proper analysis of what today’s measures mean for people of different ages, but it seems clear that young adults were hit repeatedly by cuts while pensioners were relatively well protected.
People aged 18-21 will be subject to a new Youth Obligation that says they must either “earn or learn” before accessing some benefits.
And they will no longer be automatically entitled to claim housing benefit.
The new Living Wage will only apply to over-25s, unlike the current minimum wage, which sets rates for workers from school leaving age.
For students, the tuition fees cap will be lifted, allowing some universities to charge more, and maintenance grants will be replaced with maintenance loans for new English students.
By contrast, older people appear to have emerged fairly unscathed from today’s budget, especially if you interpret the inheritance tax giveaway as something likely to appeal to the them.
It would be pure cynicism to suggest that this has anything to do with the demographics of who voted for which party in the last election, although analysis from pollsters Ipsos MORI does show pretty clearly that the youngest voters were far more likely to vote Labour and pensioners favoured the Tories:
The BBC really is taking a hit
There’s a story doing the rounds saying the BBC don’t really have anything to complain about, despite apparent government cuts.
Mr Osborne confirmed today that the corporation will have to pick up the tab for free TV licences for the over-75s, saving the government £745m by 2020/21.
But the BBC’s director general Lord Hall appeared to suggest that this burden “has been more than matched by the deal coming back for the BBC”.
Well, today’s budget documents suggest Lord Hall is putting a brave face on things. The Office for Budget Responsibility (OBR) says it’s forecast of BBC spending is “down significantly” from 2018-19 onwards thanks to the licence fee change.
Depending on what happens with licence fee revenue, the OBR is predicting that real-terms spending on the broadcaster will fall by 19.9 per cent between 2015-16 and 2020-21, compared to a 0.8 per cent fall in total public services spending over the same period:
True, according to the World Economic Forum’s latest Global Competitiveness Report. It gives the UK road network a score of 5.2 out of 7, 30th in the world and just behind Puerto Rico and Namibia.
But it’s arguable how much good news there was for road users from Mr Osborne today.
It sounded like he was making a big announcement on road building – as he has in previous budgets – but actually the commitment was to start spending the proceeds of a new Roads Fund “from the end of this decade”.
So the “sustained investment our roads so badly need” won’t happen for years. And hidden in the small print of the budget papers is the fact that by far the biggest single cut Mr Osborne has made to departmental budgets has fallen on the Department for Transport.
Transport’s capital spending has been slashed from an expected £9.7bn to £6.1bn in 2015/16. That’s a whopping cut of £3.6bn or 37 per cent on the plans set out in the last budget.