Budgets are fascinating things. No really, don’t give up on me yet. This one has been really interesting, because its underlying message has been deeply political.
It has been a budget that has seen the poor pay more tax, and the middle classes in the 22% tax bracket already slash their outgoings on income tax to 20%. It has not been a budget about the poor, the rich, or making one lot better off than the other. Its been a budget of smoke and mirrors, of dramatic changes and paving the way into number ten without actually doing, it would seem, all that much.
Gordon Brown has tried to keep the budget as fiscally neutral as possible. It might look good to steal the Tories flagship policies such as tax cuts but in fact, no matter how much this is described as a tax cutting policy, it;s not. This talk is obscured by the Chancellors refusal to outline more closely the planned increases in National Insurance contributions, which has baffled even accountancy firms according to The Guardian.
In the political point scoring and social engineering fest that has seen the cost of owning a four by four planned to go up exponentially the actual net result has been that single people with no kids and a relatively low income (graduate nurse anyone?) will actually lose out. This doesn’t bode desperately well for us students planning to leave university in the next few months.
Then just to add insult to injury, a less talked about area of the budget was the Chancellors decision to offload six billion pounds of public debt from student loans borrowing to private companies sparking concerns from the NUS that they could in fact begin to charge commercial rates for students on their spiralling debt.
A reason to be worried? Well as things stand, were companies to begin to charge commercial rates students of 2010 could be facing £10,000 a year uncapped fees at commercial rates of APR. Scary I would say.
Nobody doubts that the university system needs more funding, but it should be done with a sensible finance system set up by the government.
Faced with this the six billion pounds that the government has gained from this, it has been requested to be reinvested in universities, but with the suggestion that school leaving age should be raised to 18 that looks like a more likely recipient of the cash.
So, all round a good budget for students then. Cheers Gordon. Don’t trip up on your way into number 10.
