Chancellor George Osborne has unveiled the first all Conservative Budget for 19 years, and boy, has it created a storm.
Against the backdrop of economic crunch time for Greece, it was Osborne’s chance to say enough is enough, we have overspent and the real cuts start right now.
Only, that’s not quite what he said. Rather, he said the cuts are happening, but they will be spread over another year and, actually, Britain “can afford a pay rise”. Some of it wasn’t unexpected, with cuts to welfare but an increase in the personal allowance. Then there were commitments to NHS and, somewhat surprisingly, defence spending, set to meet the 2% Nato target. And then came the final hurrah, something a few guys sitting on the Opposition benches might have recognised, with the announcement of the National Living Wage in place of the existing minimum wage and with a significant increase, from £6.50 to £7.20 an hour, and up to £9 by 2020.
Osborne is a shrewd political operator, and it was, as promised, a BIG Budget, wide ranging in scope and not uncomplicated. Rather fascinating is that it is also both ideological in theme and rhetoric, being truly Conservative with its aim essentially to make work pay, with higher wages, lower taxes and lower welfare; and yet, at the same time, it is pragmatic, adjusting to the economic climate and political mood, with a nod to both Labour and Liberal Democrat policies of recent times.
Of course, as soon as Osborne sat down to take a breath, the political opposition, media and think tanks set about their commentary; most headline grabbing was perhaps the Institute for Fiscal Studies predicting that 13 million families will be an average of £260 worse off.
We wanted to know what the country at large thinks, so we’ve conducted a survey amongst the UK general population. In fact, it reveals that, overall, 50% feel the Budget is good for Britain, compared to 32% who think it bad, and with 18% who don’t know or have no opinion. Interestingly, the thumbs up for the Budget goes across the board, with more young people and those on low incomes rating it as positive rather than negative – although it is those with the highest incomes who agree the most (77% with over £70k household income rate it good vs. 45% of those with under £20k).
The Conservatives appear to have hit the mark, with 42% saying they have come out strongest from the Budget announcement, compared to 15% for Labour. The Conservatives have also experienced a 4% positive swing in voting preference (a net gain of 3% over Labour), comparing how people voted in May to how they would vote if there was a General Election tomorrow. Meanwhile the Liberal Democrats have lost even further ground, down 4%, with UKIP down 2%.
When we look closer at our post-Budget poll, we see that it is the ends, if not always the means, that people are responding positively to. In support of statements Osborne has made is 60% agreeing we should be striving for a “higher wage, lower tax, lower welfare” Britain, and 57% agreeing that currently Britain has a “welfare system that is unsustainable” (only 13% disagree). Yet, at the same time, only 28% agree with Osborne that the Budget offers a “fair deal” for all, with 44% agreeing that Osborne is “pulling the rug from under” many poor families.
The UK is not facing the turmoil that Greece finds itself in, and did not vote in huge numbers for an anti-austerity platform in May (or at least not outside Scotland); but we still find it hard to accept the cuts along with the hand outs, and the reality is that, in whatever shape or form, welfare cuts will affect some people in some serious ways, and adjustments will need to be made.
Unsurprisingly, amongst the most well received Budget announcements are the increase in the personal allowance (three quarters agree this is good for the country) and the National Living Wage (two thirds agreement). The NHS spending commitment topped the list (76%).
Cuts in welfare are never going to receive the same levels of support, and the figures are lower, with 56% agreeing the restriction of tax and universal credits to two children is good for the UK, whilst 40% feel this way about the freeze in working-age benefits. Agreement is stronger than disagreement though, highlighting the acceptance of reality – that you cannot have a “higher wage, lower tax” Britain without the “lower welfare” part as well.
We still wish for the impossible though as, despite strong support for NHS spending and decreases in taxation, less than a third agree that a spending level higher than projected before the election is a good thing for the country. In fact, the government’s spending plan sits at the bottom of the list, alongside university professorships to mark the Queen’s 90th birthday.
As we have seen in previous Budget and Election polls we have run, there is a disconnect between feelings at an overall country level and a personal one. 46% agree the Budget is a good thing for the UK, but only 26% that it is good for them personally. However, only a quarter disagree, with half feeling things are about the same.
This makes sense and tallies with the way Britain voted in the General Election – not relishing cuts, not feeling joyously wealthy, but understanding that politicians really do have a very difficult task to find that middle road. After all, we all want bigger pay checks and that holiday we deserve, but we also know our mortgages and loans will need paying off eventually; doesn’t mean we’ll be smiling when our interest-free period is over though.
So what of Osborne and his first solo Budget? Well, sadly, politicians and policies are all too easy to criticise and very rarely praised, but I think he can hold his head up high this time. The British public say he’s doing alright.
 Harris Interactive survey of 544 nationally representative UK adults aged 18+, conducted on 9th July 2015, powered by Toluna QuickSurveys.