Budget 2016: all the reaction

Political stakeholders

Responding to George Osborne’s statement for Labour, Jeremy Corbyn delivered a pre-prepared address that focussed on the broad agenda of the budget rather than its detail. His reply emphasised well-worn themes of his leadership to date, with the Labour leader criticising growing inequality and lambasting the unfairness of George Osborne’s decision to cut disability benefits while reducing corporation tax. 

Corbyn was also scathing about the delivery of Osborne’s flagship Northern Powerhouse, raising the fact civil servants associated with the project were mostly based in London and the paucity of transport funding allocated to the North East of England. Corbyn also attacked the Government for its triumphalist rhetoric on manufacturing, noting the sector had declined on Osborne’s watch. One rare area agreement with the Chancellor came on the proposed sugar levy, which the Labour leader said his party would back.

For the SNP, Deputy Leader Stewart Hosie accused the Chancellor of having “strangled” economic recovery through excessive austerity. He reiterated his party’s call for a modest spending increase, saying this was something that would have been “sensible, humane and productive”. On measures for industries with major interests in Scotland Hosie was more conciliatory, welcoming cuts to oil taxation and a freeze of whisky duty.

In his speech immediately after Corbyn’s response, Treasury Select Committee Chair Andrew Tyrie raised issues with fiscal rules and changes to fiscal policy based on shifting economic forecasts. He also noted the Office of Budget Responsibility’s view on the impact of Brexit. 

Outside of Parliament, UKIP leader Nigel Farage was critical of comments from Osborne on the EU, strongly rejecting arguments Brexit would bring economic uncertainty. Farage described the rest of the Chancellor’s budget as “very unambitious”.

Business and unions

The CBI’s Director General Carolyn Fairbairn hailed a “stable” budget for firms facing “stormy waters” in the global economy. She was particularly positive about reforms to business rates and a cut in corporation tax, as well as progress on HS3 and the simplification of the Government’s energy policy.

Measures on business rates were also welcomed by the IoD, which also looked forward to relief on capital gains tax and the cut to corporation tax. However, the business leaders’ organisation wondered how the Chancellor intended to run a surplus by 2019-20.

For its part, the FSB praised Osborne for heeding its calls for tax simplification benefitting small businesses and the self-employed. The FSB was also pleased by moves on business rates and a fuel duty freeze.

Commenting on fresh assistance for the North Sea, Oil and Gas UK said it welcomed any steps to reduce the “heavy tax burden” on the oil and gas industry.

The TUC’s General Secretary Frances O’Grady dismissed the Chancellor’s claim to have delivered a fair budget for the next generation. She bemoaned the prospect of “more than a decade of lost wages” and public spending cuts. O’Grady also attacked Osborne for having to downgrade his growth forecasts.

Other third parties

Celebrity chief and food standards campaigner Jamie Oliver reacted jubilantly to news of a sugar levy, saying on Twitter the proposed tax on sugary sweetened drinks constituted a “profound move”.

Money expert Martin Lewis saw plans for a new Lifetime ISA to aid savers as highly significant, describing them as “the biggest change” in personal saving arrangements Britain had ever seen.

Changes to disability benefits were a source of concern for Citizens Advice, although Chief Executive Gillian Guy was positive above moves to increase the personal tax allowance threshold and assist savers.

Influential centre-right think tank PolicyExchange claimed credit for policies announced by the Chancellor, including the new sugar levy and plans to transform all schools into academies.

The Centre for Cities’ Louise McGough said the Chancellor had been clear about the direction of local government funding, noting he had said all spending on this area would come from local government itself. 



Photograph: David Holt

Larry Smith

Hill & Knowlton Strategies Search