Financial Updates

Anyway, he is apparently going to appeal to us “squeezies” by announcing help for first-time buyers, motorists and 25 million income tax payers.   Some may argue that the budget, like the government, has its roots in the playing fields of Eton and is in fact  designed to shift the balance even further towards the wealthy elite who co-incidentally also seem to finance the Conservative party or could potentially profit from some of the measures announced.

OK, so 1 penny a litre is coming off petrol and there will be some inheritance tax breaks provided you give a chunk to "charitee",  but let’s look at raising the income tax personal allowance by £600 so that, as from April 2012, we’ll all be £45 a year better off!  Before you start planning street parties and practice your forelock tugging in gratitude, remember that Osborne's tax increases, particularly on VAT and the impending National Insurance increase, costs the average household more than these tax cuts will ever save!   VAT is much more significant for less well-off households than income tax.  They may not earn as much, but they still have to buy the same amount of stuff as their better off peers.   The poorest 20% of households pay almost 30% of their income in indirect tax, of which VAT is the single biggest chunk.

Next:  the support for first time buyers. These unfortunate youngsters (and not so young) earning  less than £60,000 a year may shortly only be required to scrape together  a 5% deposit and be offered an extra government backed  20% loan at low  interest rates for five years .  In this way, they can meet the credit-crunched requirements of most lenders willing only to finance up to 75% LTV on any property.  While this might restore affordability it will bolster current house prices and many suggest it would be better to allow them to fall to more realistic and affordable levels rather than intervene in this manner.

Aside from saddling first time buyers with even more short term debt, it will do nothing to reduce the UK's dependence on the housing bubble that has produced three booms and busts in the last 40 years.  This measure is nothing more than taxpayer’s money being siphoned off into the pockets of banks and property developers, thinly disguised as help for first time buyers.  Is that a coincidence?  Property tycoons and businessmen do seem to feature quite highly in the donations register of Tory MPs and many of our members of parliament across the board seem to have, in some cases quite substantial, buy-to-let portfolios.

Most people may be familiar with the fact that compensation is available as a result of sustaining a personal injury that was not your fault – and the pain most of the “squeezed middle” will have to endure is most definitely not their fault!    It’s the property spivs and the banks with their Whitehall and Westminster accomplices who are the perpetrators here.  So someone check out which online firm will take a claim on board on a no win no fee basis. It’s entirely possible to find a principled and competent personal injury solicitor online.   The term personal injury can cover a physical or psychological injury, disease or illness resulting in financial loss.   A psychological illness caused by the stress of dealing with the measures unveiled in the budget would, I think make a very compelling case!

The "squeezed middle"  author, Allan Bisset, works with a company that offers personal injury and compensation claims advice.