Budget 2012: A budget for the 1%

Posted: March 22, 2012 in Uncategorized
by James Meadway
Senior Economist
Today’s budget is yet another step in the wrong economic direction.

Amidst the interest rate spin, tax breaks for the super-rich and anti-green infrastructure policies, the Chancellor committed us to another year of economically illiterate austerity, despite its crippling effects on our economy and society. It’s the macroeconomic equivalent of medieval medicine, bleeding a sick, weak patient in the hope of making them better. Download our Budget briefing to find out more about today’s announcements.

The Treasury’s own figures show this is a regressive budget – the bottom 30% are hit worse than average. If that wasn’t bad enough, nearly half of all pensioners will see their incomes fall as a result of removing personal tax allowances, while richest 1 per cent of pensioners get more because of the top rate reduction. My colleague Faiza looks at inequality in more detail in her blog post from earlier today.

Meanwhile the graph you won’t see anyone talking about is this one:

Osborne’s focus on public sector debt (the yellow area) is wholly misplaced. The debt held by the private financial sector dwarfs all other kinds, and is perhaps the biggest single threat to the UK’s continuing economic stability.


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