What Britain wants from the Chancellor’s Budget... and what we’re likely to get

Given the choice, most people would want the Chancellor to stop household bills when he delivers his Budget on Wednesday.

As each of the big six energy providers hiked bills this winter, more than half of households now want George Osborne to freeze gas and electricity bills, according to research by investment manager Nutmeg.

However, they will be left disappointed, as the chancellor’s powers don’t allow him to dabble with private company pricing.

Osborne sets out how he intends to manage the country’s finances during the Budget. He will detail how much tax he plans to collect, changes to welfare, Government spending and benefits, so it’s an important announcement and affects just about everyone.

That means the second biggest ask – a cut on fuel tax – is something the chancellor can grant. At the end of last year Osborne scrapped a 3.02p rise in tax on fuel scheduled for January, so it remains to be seen whether he will go further still.

The third item on the public’s wishlist is for VAT to be slashed. Osborne raised the amount of tax paid when buying many goods and items from 17.5% to 20% at the beginning of 2011. However, there is precedent for a temporary cut to boost growth – it’s something the last chancellor, Alistair Darling, did in 2008 to soften the blow of the credit crunch.

The fourth hope is that Osborne will raise the income tax personal allowance. This is arguably the most direct way to put more money into the pockets of households. In his Autumn Statement, the chancellor announced that workers will not pay tax on the first £9,440 of earnings in the coming tax year 2013-14, an increase of £1,335 from this tax year’s allowance of £8,105.

After this, nearly a quarter of those surveyed hope that the Government will freeze council tax. The chancellor has said he will fund councils to keep bill increases in hold in 2013-14. 

A fifth of people hope the chancellor will increase the state pension. It looks as though this wish is set to be granted – sort of.  The Government announced earlier this year that state funding in retirement is to be overhauled in 2017. Under the changes the basic pension will increase from the current £107.45 a week to approximately £144.

It has now been revealed that as part of the Budget these changes will be brought forward a year to 2016. 

Nick Hungerford, chief executive at Nutmeg.com, comments: “Over the past few weeks, we’ve seen many companies outline their demands and wish-lists for the Budget, but it’s important Osborne sits up and listens to those whose pockets are hit hardest.”