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UK budget has election in mind

Wednesday, March 18, 2015 - 02:09

Britain's finance minister sought to court voters ahead of a May election by pitching an earlier end to austerity, faster economic growth and lower taxes in future. As Joel Flynn reports he also promised to bring down the nation's debt earlier than planned.

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It's a huge part of the British economy. But the UK's oil industry has been in the doldrums - low oil prices hitting producers in the North Sea hard. One of the few parts of the economy not doing well. And a target for help from finance minister George Osborne, as he delivers his budget. SOUNDBITE: UK Finance Minister, George Osborne, saying (English): "I am with immediate effect, cutting the supplementary charge from 30 percent to 20 percent and backdating it to the beginning of January. It amounts to 1.3 billion pounds of support for that vital industry in the North Sea." This was, Osborne said, a "no gimmicks" budget - claiming he intended to stick to tough spending cuts that have defined the current government's tenure. But there are just weeks to go until a general election. Voter-friendly moves like a lower tax on beer were in evidence, along with help for first-time home buyers and a raise on savings tax thresholds. SOUNDBITE: UK Finance Minister, George Osborne, saying (English): "An 11,000 pound personal allowance and above inflation increase in the higher rate, delivered by a coalition government and a Conservative Chancellor - a down-payment on our commitment to raise the personal allowance to 12,500 pounds, to raise the higher threshold to 50,000 pounds." The UK has been one of the shining lights in an otherwise dark European economic recovery. Markets are no longer scared of a coalition government, which looks the most likely outcome. But the chance of a UK exit from the EU is still a possibility. The Conservative Party has promised a referendum in 2017 and that has traders fretting. SOUNDBITE: Berenberg Senior Economist, Christian Schulz, saying (English): "If we did get a Conservative-led or especially a Conservative majority government, that risk could rise, but that doesn't look likely. Of course what is most likely is a hung parliament, no clear majority, that could mean no referendum, and that in itself could be a positive thing." SOUNDBITE: Reuters Reporter, Joel Flynn, saying (English): "This is the last budget before May's election. The big issues include immigration, education and the health service." But for many voters it's the economy that's still the burning issue. And that will mean more than saving a penny on a pints.

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UK budget has election in mind

Wednesday, March 18, 2015 - 02:09