George Osborne’s annual budget announcement failed to deliver proposals of any economic substance, according to a Manchester University professor.
The Chancellor championed an ‘aspiration nation’, boasting the coalition government’s employment record and proposed tax reforms in yesterday’s speech.
But Professor Colin Talbot, of Manchester University’s Department of Politics, saw through Mr Osborne’s charismatic delivery and into the content of his speech.
“The Chancellor delivered this year’s Budget with a lot of shouting – but the sound and fury disguises the essentially ‘do little’ nature of his proposals,” he said.
“Like the Chancellor’s rather shouty delivery, growth in the economy continues to be choked off and is forecast to continue to be stuttering.”
Professor Talbot pointed out the need to kick-start the economy immediately, which many of Mr Osborne’s proposals fail to do – instead they come into effect over the next few years.
He also slammed the Chancellor for laying blame on the Eurozone and for the ‘massive’ Whitehall underspend of £11billion.
“Mr Osborne continues to blame anyone and anything for the British economy’s poor performance, except himself and his policies – other parts of the world not pursing reckless austerity are doing better,” he added.
“This money was intended to provide public services people rely on – to fail to deliver them will be a disaster for many.”
Professor Michael Luger, director of Manchester Business School, took a similar point of view on the budget’s lack of practical effectiveness.
He said: “There is not a lot of substance in one single element of the budget. There are good gestures but it’s not enough.”
Mr Osborne had told the House of Commons his coalition is slowly but surely fixing the country’s economic problems.
He said a lack of confidence in British businesses has been misplaced and pointed to lower unemployment figures than when they came to office.
And the Chancellor’s reforms did not fall exclusively on outraged ears – his sympathisers included Nick Collett, senior lecturer at Manchester Business School.
“The deficit is not coming down quickly,” said Mr Collett. “This constrains changes the Chancellor can make to fiscal policy to stimulate the economy.
“The measures proposed for housing, investment and lending are bold and at a higher level than anticipated.
“Minor changes to corporation tax and capital gains tax will also be beneficial.”
The chancellor announced a reduction in corporation tax to 20% by 2015 – the lowest of the world’s major economies – and an annual £2,000 employment allowance for businesses.
He said this allowance will mean 450,000 small businesses – one-third of UK employers – will pay no jobs tax at all and declared ‘Britain is open for business’.
Dr Brian Sloan, chief economist at Greater Manchester Chamber of Commerce, said these, and other policies, can have a positive effect on employers in the area.
“The first impressions of the Chancellor’s Budget are that it has been fairly positive for businesses,” he said.
Dr Sloan said the new investment incentives for shale gas and aerospace industries will provide a boost for those businesses in the North West.
The Chancellor’s employment allowance will also yield positive results by driving down the overall cost of doing business.
And Dr Sloan was delighted with the news of a fuel duty freeze, after the chamber sought such a move in recent weeks.
He added: “Businesses will particularly welcome the abandoning of the fuel duty rise in September, which the Chamber called for in its letter to the Chancellor ahead of the Budget.”
Image courtesy of manchestermbs, via YouTube, with thanks.