Budget 2012

After last week's musical chairs the only deputy this week was in the Speaker's chair - as per tradition at the announcement of the Budget.

This year's announcement seemed to give everyone what they wanted. The Liberal Democrats got their mansion tax and a rise in the personal tax allowance. The Tories gave those concessions to Lib Dems to get the tax breaks for the wealthy and for business. And Labour got a budget that would give them free rein to snarl - a chance to put aside the divisions within the party and focus on challenging a budget that marked "the end of we're all in it together".

But is it really that simple?

For the Lib Dems & Tories this budget can be seen as the latest stage in rebuilding for the next election - balancing give and take to get what they want, while trying to avoid being 'infected' by the policies of the other (Behr, 2012).

As for Labour, they are struggling to shrug off the 'temporary measure' argument and gain momentum.

Having introduced the 50p tax rate as a temporary measure (Pollock, 2012), Labour face the difficulty of opposing 'tax breaks for millionaires' while addressing the possible accusation of breaking their word. Further, the Tories have complicated the matter for Labour by limiting the tax reduction to 45%, while simultaneously introducing more avoidance measures and conceding to the Lib Dems the mansion tax and personal tax allowance policies. This appears to have made the sum of the budget relatively neutral.

And as with the economics, so too with the politics. As the budget seems to buy one portion of the electorate's allegiance with the contributions of another, the political leanings also seem to cancel each other out.

All of which makes it very difficult for the Labour party to pin down the political fight ahead and its direction of attack. Some have even suggested that this may well have been part and parcel of a politically motivated budget (Behr, 2012), allowing important economic matters to be used as leverage in a political confrontation.

Once there has been time for a full analysis to be made available, the main point of concern will be where the cost of reductions and cuts will fall (Robinson, 2012). The way money is being moved around in the budget is reminiscent of a game of musical chairs. The worry for many is who will be left without a chair when the music stops.

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References:
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+ Nick Robinson's 'Budget - for millions or for millionaires?'; on BBC; 21 March 2012.

+ Rafael Behr's 'The real reason Clegg saved the NHS bill'; in New Statesman; 22 March 2012.

+ Ian Pollock's 'Taxing the rich: Is it worth it?'; 16 March 2012.

+ Rafael Behr's 'Osborne took a risk on the 50p tax to escape the quad-wrangle'; in New Statesman; 22 March 2012.