George Osborne opened his 2014 Budget announcement by proclaiming that his party would be announcing a Budget for ‘makers, doers and savers’, but what did he actually go on to announce that would benefit those three distinct groups? We took a look at the Chancellor’s speech and picked out the highlights for each.
Announcements: Major reforms to pensions and ISAs
How does this help?: The pensions announcement gave savers much more flexibility with what to do with their pension once they retire. From 2015, savers will be able to withdraw their pensions in full and invest or use them as they wish, freeing them from the requirement to buy an annuity, though this may still be the way to go for some. ISAs have also become more flexible, with an increased limit and Stocks & Shares ISAs being combined with Cash ISAs to form a New ISA.
Announcements: Apprenticeships doubled, extra money to mitigate high energy costs
How does this help?: The extra funding for apprenticeships is aimed at helping businesses to find and train more labour at a very reasonable expense. Importantly, some of this increase in apprenticeships will be from new degree-level apprentices. Manufacturing firms were also targeted with a scheme to reduce the cost of energy consumption. Such firms typically experience extremely high energy costs and the government scheme is designed to allow to reduce overheads, in theory allowing them to make more.
Announcements: Minimum wage increased, fuel duty frozen, simplified taxation for the self-employed
How does this help?: With cuts to welfare continuing, as per this government’s policy, there were rewards for ‘doers’, which probably really translates to ‘workers’. The minimum wage increase was bolstered by a freezing of fuel duty, thus lowering workers costs whilst simultaneously giving them a little extra in their pay packets. Self-employed workers may benefit from the small rise in the upper tax limit but will also benefit from the simplification of their tax bill, which should save time and therefore money.