SPRING BUDGET REACTIONS: 81% ARE NEGATIVE OR NEUTRAL

Lack of announcements on housing and public services a disappointment

More than 80 per cent of respondents are negative or neutral on the UK government’s budget, a survey of Airmic members this week revealed. The lack of announcements on key issues such as housing and the NHS and public services were the reasons cited, as was the lack of a longer term economic strategy for the UK

National Insurance cut

For 58% of respondents, the 2p cut in National Insurance contributions from employees was the most important announcement in the budget, although the reception on the announced cut was split.

Some thought the National Insurance cut to be politically motivated rather than economic, while others thought it more fiscally prudent than cutting income tax.

This follows on from an earlier cut of another 2p in National Insurance contributions which took effect on 6 January. Nevertheless, employers would still be looking to pay more in National Insurance contributions as wages continue to increase.

Fuel duty freeze

The extension of the 5p cut in fuel duty, which was frozen in 2022 in the wake of Russia’s invasion of Ukraine, was welcomed by Airmic members.

Leigh-Anne Slade, Head of Media, Communications and Interest Groups, Airmic, said: “Rising global oil prices since the start of 2024 have meant higher pump prices for members of the Airmic Fleet Special Interest Group. The extension of the fuel duty cut comes as a welcomed relief to them, as their organisations face operating cost pressures, continued high interest rates, and seek to recover from the UK’s mild recession.”

Towards the general election

Some respondents recognised the limited fiscal headroom available to the government, and found the resultant budget to be balanced on affordability while still providing benefits to workers through the National Insurance cut.

Hoe-Yeong Loke, Head of Research, Airmic, said: “Criticism of the government’s budget from the opposition Labour party has been mooted, not least because both front benches are painfully aware of the limited fiscal headroom over the next few years.”

“Taxes will have to rise whoever wins the UK general election due by January 2025. By dishing out less generous tax cuts than would be expected in a pre-election budget, Jeremy Hunt and the present Conservative government may have retained their fiscal credibility and called Labour’s bluff.”

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Media contact: Leigh Anne Slade
Leigh-Anne.Slade@Airmic.com
07956 41 78 77