Autumn statement: Reaction
Matthew Sinclair, chief cxecutive of the TaxPayers’ Alliance said:
"George Osborne has taken some welcome steps to ease the burden on struggling taxpayers but the Government is still wasting far too much money. That means some families are going to pay even more now and too many debts are still being left for the next generation.
"It is great news that the planned rise in Fuel Duty has been cancelled. That will help already overtaxed motorists across the UK. Another increase in the cost of filling the tank would have been a further blow to many families struggling to make ends meet.
"Taking more people out of income tax altogether will ease the burden on low earning families and, with action to stop a rise in benefits outstripping increases in earnings as well, it will improve the incentive to work. Leaving more money in people’s pockets is better than taking it away and then giving it back in benefits."
Nigel Green, the chief executive of the deVere Group said:
"Lowering the maximum annual tax-exempt pension contribution to £40,000 from 2014/15 could discourage higher earners from spending, which would be detrimental to economic growth. Reducing pension wealth, which accounts for more than half the accumulated wealth of the UK’s better off households, could have far-reaching, unintended, negative implications.
"In addition, Mr Osborne’s cash-grabbing raid does not only affect the super-rich. It will hit middle income earners who increase contributions to their pension pot later in life, as well as owners of enterprises, which are vital for the UK’s economic growth. High rates of personal tax are damaging to business as they reduce a company’s ability to grow, meaning lower job creation."
Nick Pearce, director at IPPR, said:
"The Chancellor’s fiscal rules are a busted flush. The economy needs greater stimulus now, offset by more rapid consolidation later, and the fiscal framework should support that approach.
"The increases in capital investment are welcome. But more help with childcare, rather than increases in the Personal Tax Allowance, should have been given to working families, who will also now see their tax credits cut further in real terms."
Ed Cox, director of IPPR North, said:
"The Autumn Statement contains some small measures to enhance local growth with the Single Pot proposal a clear precedent to decentralise economic development powers and funding. But to really heal the nation’s fiscal health the Chancellor must accept that northern prosperity is national prosperity and take more radical measures to shift investment in London and the South East northwards."
Nick Beecroft, chairman and senior market analyst, Saxo Capital Markets said:
"As predicted, whilst in many ways innovative, striking a careful balance between fiscal probity and growth promotion, and between rich and poor, this statement is all very boring and predictable, no diversion from the Plan A deficit reduction program, hence stocks, sterling and gilts will be virtually unmoved!"
TUC General Secretary Brendan Barber said:
"When you are self-harming you should stop, not look for better sticking plasters.
"With the economy still scraping along the bottom, unemployment set to rise and the Chancellor missing his own debt target, we need a fundamental change in direction, not more muddling through.
"Cuts, austerity and squeezed living standards stretch seemingly without end into the future. What is missing today is any vision of a future economy that can deliver decent jobs and living standards – it's pain without purpose."
Plaid Cymru treasury spokesperson, Jonathan Edwards MP said:
"This Autumn Statement is a humiliating climb-down for a Chancellor in denial who is now being forced to admit the failure of his austerity experiment.
"Missed debt and deficit targets coupled with the OBR’s downgrading of forecasts have exposed the Chancellor’s lack of a long-term strategy for growth and he is now presented with a golden opportunity to reverse the downward spiral which is rapidly leading to increased and institutionalised poverty and unemployment.
"The Party of Wales has always advocated an alternative to austerity. Our proposals to reform the Barnett formula, devolve business rates to Wales, and implement our Build for Wales plan would all promote growth and create meaningful jobs for the 100,000 Welsh people made unemployed or underemployed since the Coalition came to power."
Green MP Caroline Lucas (Brighton Pavilion) said:
"At this critical moment for the UK’s energy policy, Osborne’s gas strategy looks like nothing short of a disaster – for the economy, the environment and for people’s energy bills.
"This reckless move, driven by ideology not evidence, risks locking the UK into an expensive polluting fossil fuel future – increasing our exposure to volatile gas prices and forcing controversial fracking developments onto communities before the full impact is understood.
"While we know that gas can play a small part as a bridging fuel as to move to greener sources, the government’s decision to sign off upwards of 30GW of new gas simply flies in the face of warnings about the consequences of a ‘dash for gas’ on both consumer bills and legally binding climate targets"
Dominic Haslam, director of policy at Sightsavers said:
"It's extremely positive that the Chancellor is standing by his promise to dedicate 0.7% of national income to international aid next year. The UK has a long legacy of leading the fight against global poverty, and it’s essential that we use our influence to ensure the European Union also delivers on the 0.7% commitment as it develops its budget from 2014–20.
"Although the tough economic climate is taking its toll on us here in the UK, its impact is being particularly deeply felt by millions of vulnerable people in developing countries, who don’t have a safety net to fall back on.
"UK aid is making a vital difference to the lives of many of the world’s poorest and most marginalised people, including those who are visually impaired and those with limited access to healthcare. In the last year alone UK aid delivered through Sightsavers and our partners has given nearly 100,000 people sight-restoring surgery and supported over 1,200 visually impaired children to attend school."
Sir Barney White-Spunner executive chairman of the Countryside Alliance said:
"Countrysiders and their businesses are penalised for their rural location, paying more to run a car, which is an essential not a luxury for them; this freeze in fuel duty will help to alleviate this pressure."
Serial entrepreneur Dan Wagner, CEO and Chairman of mPowa, said:
"This is not good news for UK business and the UK economy. It will impact on businesses’ confidence and willingness to invest and expand. Another six years of austerity is likely to have an enormous knock-on effect as companies lack conditions favourable for growth. Inevitably this will have a negative impact on job creation. Instead of providing the impetus for revival, I fear this will perpetuate a cycle of weak growth or stagnation.
"Much of the UK economy rests on small and medium-sized businesses. SMEs are responsible for over 50% of new jobs created in the UK and make up over 70% of the private sector."
Gary Wilkinson, CEO at Cambridge & Counties Bank said:
"We endorse the call for the Government to continue focusing on UK SMEs and fast-growing businesses – the ‘engine room’ of our economy. It is imperative that the Government looks to strengthen the UK’s position as the home for small and mid-sized growth businesses by focusing on the promotion of new bank lending. Indeed our most recent research reveals that in H1 2012, Britain had 47,777 overdraft and loan applications worth as much as £ 2.5 billion rejected. Clearly there needs to be more innovative channels of obtaining capital other than from just the bigger banks.
"While the ‘funding for lending’ scheme, the new British Business Bank and today’s announcement of a cut in corporation tax show that the Government is being proactive in the SME space, there needs to be better co-ordination of such initiatives. At first sight it is difficult to see how these measures will significantly increase the availability or suitability of credit for SMEs, particularly in the near term. Further details are required about exactly how the new Business Bank will ‘partner’ with existing banks and other lenders."
Gillian Guy, chief executive at national charity Citizens Advice said:
"At last we have some recognition that the welfare budget has been squeezed dry. Cutting another £3.7 billion will still hit working families and families on the edge. It would have been reckless to cut more just ahead of the biggest shake up in the benefits system for over 60 years. It’s vital that the government makes sure Universal Credit works for people before thinking of any more welfare cuts.
"Holding down benefit increases to 1% is better than a total freeze, which would have been disastrous for people on the lowest incomes already having to spend a higher proportion of their income on essentials when rents, food and heating bills are all rocketing."
Julia Unwin, chief executive of the anti-poverty think tank, the Joseph Rowntree Foundation (JRF), said:
"The Government is giving with one hand, but taking away with the other.
"Investment in infrastructure is welcome and increases in the income tax threshold and scrapping fuel duty rises will make life a little cheaper.
"But snipping at the safety net and reducing the value of benefits at the same time will increase poverty and hardship for the most vulnerable. We’re at risk of consigning the poorest to a decade of destitution.
"The government knows the distinction between ‘striver’ and ‘shirker’ is entirely false. People move on and off benefits: in the last two years, one in six economically active people have claimed jobseekers’ allowance (JSA). So reducing welfare hits people who are doing the right thing and working hard."
