Cheers Chancellor! Winners & losers from Budget 2013

"Name and shame promoters of tax avoidance schemes" - aka provide free advertising to promoters of tax avoidance schemes

No additional Personal Allowance for Pensioners then, so they will fall further behind other taxpayers.

Don't think pensioners will fall further behind, they just won't have extra advantaqes.

Once again the lobby groups demonstrate their inability to do maths:

"If the government had increased tobacco tax by 5% as we requested it would have increased government revenues and helped more smokers to quit smoking,’ said Deborah Arnott, chief executive of Action on Smoking and Health (ASH)."

George? So far so good today.

Same thing isn't it? Don't forget two things:

1) You will be a pensioner one day

2) Pensioners have paid tax all their lives so that others can have advantages.

I see know reason for changing the unwritten contract which is based on being slightly generous to the old folk. Of course this a foreign thought for Tories.

At first glance I think Osbourne hasn't done too bad a job with the (very) limited hand he has to play with. The £10K personal tax allowance is a welcome gesture. Help for home buyers has to be a good move because, like it or not, an active housing market is good news for the economy at large. Corporation tax cuts were essential. I would like to have seen the public sector reigned-in further, but that should come at some stage. As a faltering supporter of the Conservatives, I am not unimpressed with his budget overall...

James

Governments can change "contracts". One of the biggest thefts from pensioners is the Brown tax on dividends. Not only did it change the rules, and apply to existing funds which were locked in, but it is also double taxation since the pension is taxed again when taken. Since it was introduced this had taken around £100bn from pension funds and goes on. Compared with this all budget measures are paltry.

Good Budget. Emphasis on small business promotion, effort to help building and home ownership, attraction for investment and attack on tax dodging and keeping up the principle of keeping more of earnings in the wage packet by personal allowance rises for the honest toilers.

Noted the opposition response was the same old rubbish and still trying to buy votes from those who may have forgotten who created this situation by overspending in the first place.

When will 'they' get the hang of understanding the benefit of higher tax receipts, by a 50% rate rather than reducing net receipts to the treasury by increasing it? The Law of diminishing returns still holds. Of course they understand this, they just think, and insult the voters by doing so, that banging on, in ' apparent ignorance',will convince some that the false point is valid.

Rubbish opposition response. How can those people still hold their heads up to retort and abuse whilst still wishing to promote the same disaster policies and seek re-election. Ed Balls head shaking pantomime, a travesty for all of us who have been betrayed by failed policies of a previous administration and still cited, by those benches, as the answer to a world wide crisis.

Good for you Mr Osborne. Little room to move but best policy given the circumstances.

"If the government had increased tobacco tax by 5% asf we requested it would have increased government revenues and helped more smokers to quit smoking,’ said Deborah Arnott, chief executive of Action on Smoking and Health (ASH)." ---

If more smokers quit due to increased Tobacco tax, they would be paying no Tobacco tax at all and the government would actually get less revenues from Tobacco not increased revenues to the government

Main Budget snag is that all the growth (hence employment) moves come in 2015, not right now. So there'll still be too few taxpayers to control the debt for the next two years. A mystery, until you realise wages carry on falling against prices, so giving companies bigger profits, which given Footsie's rise on the back of current profit levels they don't really need.

What the country does need are incentives for businesses to invest their now massive cash reserves into projects that provide jobs, ie more taxpayers. (By the way, where do they park it, as we'd all like something better than 1 or 2%?)

So it all looks like a classic bosses' ploy to drive down the cost of labour -- helped by keeping unemployment high. This isn't really a convincing policy nowadays, despite Osborne's actually quite clever speech in the awful circs.

Beer? Oh it's just froth -- sorry.

The Government of the day can only pay lip service to the idea of weaning people off smoking. If everyone did stop, they would lose all that excise duty and VAT, they would save something on the NHS bill but that would be more than offset by former smokers now living much longer and as a result the state retirement pension bill would rocket exponentially even more than it is at present.

Not bad all things considered. Ease up on the income tax and those working will be able to do one or both of two things - save a bit more, or spend a bit more, either way the tax man wins. As for smokers, knock a load of the tax levy and let them buy more and more fags instead of getting them from duty free, but then tell them that as smokers they'll have to pay for their helath care rather than get it on the NHS - another double whammy for the tax man. If they don't, then they stay poorly - they chose to smoke!

What Osbourne should have said, which would have pleased thousands in this country and helped toward balancing Labour's big fat deficit, would have been to cancel all overseas aid! This country has been throwing good money after bad for decades - forget India and Africa, let's get home sorted first!

Should have put beer up by 5p a pint.....it was already expected and in the bag

Nah, disagree completely Rik, knock 50p off a pint of beer and watch beer sales rocket, pubs start to become profitable again - both good earners for the tax man - and the trade in beer run duty free imports drop off.

"Osborne firmly put its faith" He did, did it?

It goes on.... "the construction industry who will need..." I take it you mean "which will need."

Written by illiterates-r-us again, I see.

I feel for those unable to afford a decent home but subsidising house purchases only drives up the price and leaves no one but the heirs of current owners any better off. The correct solution is either to facilitate construction of new houses in shortage areas or to persuade business to relocate to areas where housing is more readily available.

Except for local businesses like sandwich shops, there is no particular reason for most companies or other organisations to be located in and around London.

Jon

You are partly correct, although I'm not sure about your figure of £100 billion.

What Brown did was to apply the rules regarding capital gains tax to share transactions within pension funds. In fairness everyone agreed that, at that time, the funds were 'awash' with cash.

In any case pension funds should not be buying and selling shares on a regular basis and you might argue, with some justification, that most of their funds should not be in equities at all.

You have also forgotten that these same company funds were urged by their actuaries that it was acceptable to take a payments holiday and some even tried to persuade their employees to do the same. I know because I was an employee at that time and saw it happen. Needless to say, the employees wisely declined the offer but companies did not and subsequently ceased making contributions. All this happened against the background which I mentioned above i.e. surplus cash in funds.

How much this cost pension funds I don't know but I suspect that it was more than Brown's so-called 'raid'.

When companies complain about holes in their pension funds, they might reflect that they brought it on themselves, although in fairness, their stupid short-sighted actuaries were the real culprits.

T Chand - Have you never heard it said that if the Government banned smoking altogether, the improved health of the public would pay for the entire National Health Service?

This budget does nothing for the old age pensioners & savers. So far as the price of beer is concerned you have to drink 10 pints a day to save ten pence; what a joke. In any event it would unlikely to be passed on by the sellers to the customers. Conveniently the price of cider, wine & spirit has been increased

considerably robbing elderly people from their occasional little pleasure.

As usual rich will benefit, poor will benefit & honest hard working people will loose out & continue to subsidize the rich & the poor.

So much talk about growth; as a nation we have not got a clue nor have a consensus how to achieve it. At this time of nation's dire need it should not be left to the coalition govt. ( they do not have a true majority) alone to decide the growth strategy.It should be decided by an all party committee backed by business, banks & academics. Hoping to secure the nation's future again on a housing boom is wrong & unwise. As long as we have regular large trade deficits ( i.e imbalance between export & import) we shall never see real growth

& shall only talk about it. Therefore I suggest work hard, produce more, import less & export more & enjoy the resulting growth.

Rathin Gupta

Not a bad budget. Bear in mind that Osborne has to start to play to voters as the next election is this side of the horizon. If only he had introduced really swingeing MONEY SAVING cuts back when the crisis broke we would be a lot better off today. As it is, with the cuts he has made up to now, he has kept the rate of increase of borrowing well down as compared to the rate of increase of the previous government. He is totally correct that for as long as we are needing to borrow more money, we MUST MUST MUST do all we can to keep the interest rates on the repayments down. As it is we are paying £50bm interest pa. and reducing this figure is not only necessary for ourselves, but also as an indicator to the international money markets that we are in control of our own finances. When the crisis broke, faced with Whitehall, he did what he could, but he should have used the moment to slash theirs and other public sector costs rapidly by a big percentage, as the Irish did. Because of having done that, the Irish are much further down the road to gaining control of their costs that we are. We learnt on the news only yesterday that Whitehall has interpreted the pay freeze as meaning that people have been getting their annual increments (on very high salaries with mega associated benefits) until they hit the top of their particular pay scale. That is not a cut in my book. To be honest, Osborne should cease letting the NHS, foreign aid and schools be protected from cuts any longer. Remember, we ARE in the ordure! There are plenty of inefficiencies that need rooting out in each of these areas. I do favour keeping funding up for HMRC – we all know people who don’t pay the taxes that they should, and those who do pay their taxes are supporting these criminals. Personally, I have a good respect for Osborne. He is articulate and bases what he does on the facts. Contrast him with Ed Balls, whose mendacity is the size of whole galaxies: as Gordon Brown’s henchthug he did nothing but support Brown in his madness and it is a great pity that there was no-one in the then Labour Government who could deal with Brown (and I’m thinking first of all of Blair here). It also really offends me that the media give such a disgraced has-been the regular opportunity to comment on what the Coalition do, day by day. Ten years of Brown has done this country more harm than did Hitler, and it is still right to take this into account when you consider the mess that our Coalition has inherited. It takes a lot longer to repair a car than it does to have the accident!

James O'Connel

I understood that pension funds were ordered to reduce their holdings of - allegedly - surplus cash because companies were using their pension funds to store profits without paying tax on them. They could then withdraw the cash from the pension fund and spend it for investment. Pension holidays were a government idea.

James - obviously you have not struggled for many years to build up a proper personal pension fund, foregoing many luxuries, only to see the projected value nosedive.

Not sure why you do not think that pension funds should invest in equities. One of the big problems now is that many changed their strategies after Black Monday, such that they could never recover and, for the past few years have shown miserable performance, especially after their management charges

"What Brown did was to ........."

No - what Brown did was withdraw the notional tax on dividends (not really notional as corporation tax had been paid first). If you receive a dividend you get this credit allowed against your tax. So pension funds lost this acknowledgement that tax had been paid, and you pay it again on your annuity. And he was advised that this was a bad idea by the Treasury, although he could not remember that !

And see Jeremy's comment above which you seem to have overlooked - although this does not apply to personal pensions. Of course the companies can reduce profits to top up their pension funds, so their pensioners are not affected. But those with private pensions have no one to dump their loss onto.

And now this budget is prolonging artificially low interest rates which is again hitting those with personal pensions, and especially when they want an annuity !!

Well Done George for paying pre Sep 1992 ELAS WPA's at least something. More than Labour and that sh!t Gordon Pensioners Enemy Brown ever did.

Petrol prices remain a disgrace. Last timne I looked only Uraguay or some other banana republic was higher in the World order.

Beer should have gone up as well. Why penalise cider drinkers, wine drinkers and spirit drinkers. UNFAIR.

Time to restore divi tax relief especially for wpa'S IN PAYMENT ESPECIALLY WHILST MP'S AND PUBLIC SECTOR WORKERS HIT THE UNFUNDED PENSIONS JACKPOT PAID FOR BY POOR PENSIOONERS AMONGST OTHERS.

Time many others took a pay cut like NHS staff, civil servants MP's Lord's and the like...........

rich banker

If you look at the budget statement in detail you will see that public sector pensions have been hit hard. Public sector employers are going to have to cut services to keep paying their contractual obligations. If you read the newspapers (real ones, not the Sun), you would know that public sector pay has risen by less than inflation for several years now.

Moral and intellectual bankrupts will rejoice to know that many thousands more public sector workers will be sacked because of cuts to departmental budgets.

Jeremy Bosk

So I must be both morally and intelectually bankrupt then as I do rejoice at the thought of the state moving out of areas in which it has no business and/or is deeply innefficient. The real moral bankruptcy is the extortion of hard earned money from the populous to be hosed down the government drain; the sooner tat stops the sooner we will get back on our feet.

re Jeremy Bosk.

Long time ago but I thought Companies lobbied government to be allowed pension contribution holidays when they were in 'actuarial surplus'. I think it was Mrs Thatcher who was only too keen to oblige with a law change.

But the 'surpluses' mentality didn't acknowledge that investment performance is often cyclical and the 'surpluses' would be needed to offset future losses - which it was conveniently decided wouldn't happen

As a holder fo a personal money purchase pension I agree entirely with those who criticise the Brown/Balls tax theft. In fact it is worse than stated. Dividends paid outside a pension fund attract tax at 10% less the 10% tax credit = zero to recognise the corpration tax already paid. Dividends inside a pension fund ultimately pay tax at 20%, effectively a double tax charge.

James O,C, capital gains tax has nothing to do with it. Why should not funds trade in shares to maximise profits for their investors? Again, pension funds do not have the benefit of the annual capital gains allowance as the gain is also ultimately taxed as income. Another nice little earner for the government.

It is time that pensions were taxed as dividends, at 10%, not as earned income at 20%. Better still, treat pension annuities the same as ordinary purchased annuities.

MoneyObserver

Mar 21, 2013 at 10:03

Yes. There is plenty of blame to go round. This country's problems go deeper than one party or individual Chancellors. We have been going backwards relative to other advanced economies almost uninterruptedly since the 1870s. We are being overtaken by more and more formerly backward countries.

Our political, educational, financial, economic and every other system need to radically overhauled.

Maverick,

I think you've been listening to the anti smoking lobbyists too much. Not everyone who uses the NHS is a smoker (I suspect the majority aren't). As has already been said, while stopping smoking may save money for the NHS, the overall governemt income is reduced through less vat and tobacco duty. Additionally, ex smokers will live longer and claim the state pension for longer. The economic argument against smoking just doesn't wash.

Smokers pay so much tax on the weed that, as I understand, the revenue would fund a very large chunk of the NHS.

Jeremy there is absolutely no need for any public sector workers to lose their jobs given the amount of potholes that need filling.

joe

Not all those losing their jobs are fit for manual labour being mainly clerical and administrative workers. But you are right that the potholes need filling and the money should be provided through government easing the squeeze on local authority budgets. There are plenty of unemployed construction workers to do the work.

There is an abundance of borrowing capacity in this country if the political will existed to use it. The borrowed money could be used to build infrastructure as well as catch up with the backlog of repairs. The newly employed people would a) no longer be paid social security and b) be paying taxes that could be used to reduce the debts. This is called investing for the future, a concept that Tories refuse to understand. They prefer to increase public expenditure by sacking people and putting them on the dole.

Jeremy

The proposition that youput forward of the government borrowing yet more money and then spending it was tested to destruction by G Brown & Co. Admittedly their primary driver was to create a client state, which they have done with great effect; unwinding that mess too slowly is the Tory sin.

Jeremy

How can paying someone at least £25k (including overheads) be less expensive than paying someone on the dole ???? The tax they pay will by no means make up the difference. And with their extra net cash they will increase imports, foreign holidays and overseas remittamces which will damage the UK further. If you call that "investing" in the future then you clearly have no financial training.

There may be "an abundant borrowing capacity" as you call it, but if the UK borrows more then it will have to pay higher interest rates on not just the extra, but all the current debt when it rolls over. This is a lesson Greece, Spain and Italy had to learn .One of the reasons the NHS is failing is because they went into borrowing through PFI in a big way, and now the chickens are coming home to roost. Our local Trust spent a fortune on a huge new foyer which does nothing for patient care, and they were not alone.

And public sector pensions and wages have not been hit HARD. Perhaps we need to follow Ireland's example and CUT both by 25%. Public sector pay has risen much faster than in the private sector, and there are very many overpaid managers of managers of managers etc, especially in the NHS. And public sector pensions have just been reigned back, but are still worth far more than a few years ago, with no loss of accrued rights. Compare that against a private pension whose projected annuity has fallen bu 2/3 over the past 15 years !

Forget Keynes - he never expected National Debt to get so out of hand, and assumed that each economy was relatively closed - not part of a Global system. And we have to be careful about infrastructure as it has to give a return. That is a definition of investment which "Prudence" Brown never understood.

And those in public employment who lose their jobs may not be manual workers, but there are plenty unemployed who could lift a shovel which you have acknowledged !

Why on earth is the UK taxpayer bailing out Equitable Life policyholders?

I recollect Equitable used a different measure of their reserves than did their compeitors, which made them appear adequately capitalised. Suffice to say EL's projections looked great versus competitors... it's another example of greedy people ignoring the facts and they should face the consequences. After all... no-one is compensating customers fro under performing mortgage endowment plans (unless they can prove they were mis-sold).

Jon

It is called the multiplier effect. Pay someone 25,000 instead of the pittance of the dole and they will spend a lot more than otherwise. That spending is earnings for the butcher, the baker and the candlestick maker. These worthies in turn have higher incomes with which they pay more taxes and spend themselves on paying the tinker, the tailor, the soldier and the spy. Who in turn use their higher incomes to pay more taxes and spend more money and so on in a virtuous circle. Look up multiplier effect on Wikipedia.

PFI was an abomination, not because hospitals and schools were built with borrowed money but because they were built with money borrowed by companies at a far higher interest rate than if the money had been borrowed by government. All to fiddle the Public Sector Borrowing figures. Furthermore, when government and local government employed their own workforces, as in council house building, there was no need to price in the cost of directors' multi million pound bonuses or shareholders' dividends. Politicians' theological aversion to sane economics is the bigger problem.

I base my remarks on public sector workers suffering a blow to their incomes and future pensions on this article:

http://blogs.ft.com/westminster/2013/03/changes-to-state-pension-will-give-exchequer-enormous-stealth-windfall/

NB I would never suggest that private sector workers have not also suffered, perhaps worse.

My original comment was provoked by rich banker and his nauseating friends who gloat at the destruction of other people's livelihoods. I don't care whether jobs are lost in the public or the private sector. The proponents of mass sackings do rejoice in the misery and destruction caused by "austerity". This disgusts me and everyone on the planet who is not a Tory sociopath.

Jeremy - I am fully aware of the multiplier effect, This same effect meant that the Treasury got most of the bank losses which were spent by people who could not repay. So the taxpayer made a PROFIT from the banking crisis as the Treasury receipts far exceeded the cost of the bailout.

But mathematically employing people rather than paying them dole increases disposable income and thereby not only increases inflation but also increases consumer imports and other external bleeds of Sterling.

Using your argument, then a great way to end our problems would be to double eveyone's pay like Greece did. Now can you understand how foolish your suggestion is? Balls and Co have still not learned that this strategy caused most of our existing debt.

Public sector workers may suffer blows to their income and pensions, but not half as bad as many in the private sector. After all a million of them should not have been given the new jobs Brown created as we could not afford them. So they should be GRATEFUL that they had some income for which we are all paying for now. Individually I feel for them, but in broad terms we cannot employ anyone we cannot afford, nor anyone who does not contribute more than their cost (including NI, pensions and so on) to the economy. We are in competiton with countries which do not provide anything like the frills the UK does, and hard though it might be we have to level the playing field a bit.

Anonymous - Equitable life misled later investors as it stated that it had covered the guaranteed annuitants with a ring fenced fund. So it missold to these new tranches. This is what is being compensated - not the longer term performance. Therefore, on this basis, it would appear that you would agree with the compensation.

Jon

Most of the unpaid loans from the banks were given to companies, not consumers, to buy commercial property. Household debt, despite some eye watering individual cases, is relatively trivial.

You can read about property debt here:

http://costarfinance.com/

It is also exhaustively covered in the FT and reasonably well in the Telegraph.

So: according to you, increasing disposable income increases inflation, increases imports and bleeds Sterling. Therefore, to save the Pound, nobody should ever have a pay rise?

Increased disposable income leads to inflation only when there is a shortage of goods. So, notoriously, in this country houses rise in price almost regardless of circumstances, especially in the south east. But electronic goods such as computers keep coming down in price or adding performance and features so that consumers get better value. Because there is a practically endless supply of electronic goods being made ever more efficiently. At present in the UK there is a dearth of effective demand as even most of those who have the cash now dare not spend it for fear of future economic disaster. So aside from inflation caused by tax increases and by a few imports such as gas, UK inflation is quite low. We could employ millions more people before their rising incomes caused inflation. Prices of most imports are set by world markets.

It will be years before the UK economy recovers enough to generate internal inflation.

Obviously, you believe that "increasing consumer imports" is a bad thing. Our imports are the exports of other countries. With which they finance their imports of our goods and services. See under "taking in each other's washing". See also comparative advantage.

No country can be only an exporter, nor can any country be only an importer because one country ends up with all the money while the others go bankrupt and can no longer buy that country's exports. Unhappiness all around.

You seem to believe that public sector workers provide no value. Imagine the stench and disease if there were no bin men, no sewage workers, no doctors and nurses. Imagine the anarchy if there were no police. The general state of ignorance in this country is bad enough now: imagine it with no teachers, no schools or universities.

So anyone but a Tory would agree that some public sector workers are useful. Tories and others would argue that there are many public sector workers who serve no purpose. To which I say: reality television, pop music, fashion, professional sport, overpaid bankers... The distinction commonly made between "good" private sector workers and "bad" public sector workers is a false one. It is in fact no more than propaganda from the unprincipled right.

We seem to have drifted away from the budget a bit.

Labour is right when it says that Osborne's policies have failed. How can anyone argue with that ? Whether that means we should borrow more or whether we should reduce the deficit quicker, I am not sure and no one else knows either. I do remember when Norman Lamont's policies failed and we devalued that the result was, unexpectedly the best possible outcome for the UK.

More of the same cannot be the correct policy.

Macro Economics is incredibly complicated. It insults our intelligence when politicians try to compare our Country's finances with a household budget e.g. "The answer to solving a debt crisis is not borrowing more"

The UK is not bankrupt.

Why is the wealth of its citizens never taken into account when the statistics are churned out.

Let us take a few risks and try something new.

Iceland was bankrupt but they are still surviving.

Anything is better than "More of the same"

Jeremy - so where did the money go that the banks lent then? Did the companies burn it? No it was spent and went into people's pockets.

Inflation is low ?? Kept down by the cheap luxuries you acknowledge. But do you buy FOOD for example, or energy ? Sterling has fallen because we have borrowed too much and cannot get the annual deficit down fast enough and that is the main reason for much of our inflation..

When will your ilk understand that GDP is NOT a measure of wealth creation but a measure of spending. We had "growth" under the last government because it was fuelled by DEBT. When the credit taps were turned off GDP was bound to fall. And then as many individuals started to repay their debts and had less spare cash it fell again. But the underlying net wealth of the nation did not fall. The GDP is still too high as government is still borrowing more. The fact that GDP has not fallen more is surprising, and shows that people are still spending. It amazes me how few people really understand GDP and what it means.

"You seem to believe that public sector workers provide no value..." NO I did not say this and your reaction is a typical left wing knee jerk reaction. I said " in broad terms we cannot employ anyone we cannot afford, nor anyone who does not contribute more than their cost (including NI, pensions and so on) to the economy."Bin men DO contribute to the economy (although some in Bham are paid £50k pa - far more than a nurse or teacher). I also agree that many celebs etc are ridiculously overpaid, but that is supply and demand in a free market and you appear to agree with me that they are overpaid as they do not contribute, backing up my argument. Butthe total all of them are paid is NOTHING in comparison with the levels of public spending. So let us once and for all stop using examples of puddles to sort out the oceans. The ignorant believe that if bankers repaid their bonuses that would solve our deficit !!!!!

So Clive - I do not believe that the Coalitions' policies have failed. True, they have not cut the deficit as fast as they should. But with only a small fall in GDP there must be an underlying increase in wealth creation as the extra 1m jobs would suggest.

anonymous on Equitable

Its called bad regulation thats why !

A certain amount of debt is OK but the fact is the banks and BofE for not stopping it got it wrong.

We are now all paying for this failure some more than others - it's austerity for some BUT and its a big one austerity is now nothing is nothing like it was duringand after WW2 as any pensioner can tell you. So we need less moaning and more working and a culture that says No worky no eaty like in China & India and other emerging powerhouses........

re rich banker

"austerity is now nothing is nothing like it was duringand after WW2 as any pensioner can tell you"

I'm sure your right - my brother (mid 80s) tells me that in the 30s there was not enough food for my father/mother/and him.

And the modern definition of 'Poverty' as a statistical expression (I think income below 60% of the median) almost guarantees that it can never be eliminated.

Poverty - Not trying to come over with the sob story, but apart from being roiled by the Highwayman Rigney at Topps Rogers, I also lost my job last August. Since then I've had to sign on at a local job centre, where 'poverty' is rife. However, it's not a simple as folks being hard done by, though to be fair odd ones are, it's about knowing and playing the system. Some of the uneducated regulars there - and there are thousands per day, the job centre is vast - would not make doorstops and they like their life on benefits. I've told my wife I've got to change my image to be able to fit in, so I'm getting a grubby white tracksuit, some big trainer boots, a baseball cap, loads of tattoos, a few facial piercings, plenty of fags, a tin of Red Bull, a big dog and pregnant mixed race girlfriend with a different coloured nipper in a pushchair. Then I can be one of the gang innit....

Who the hell is Jeremy Bosk?

He's totally wrong about pension funds. I was at the centre of the 'contributions holiday' fiasco, so I know for certain what happened.

It was certainly nothing whatever to do with the government. It was purely the result of corporate greed.

I've just read today's 'i' newspaper. They report that the Institute for Fiscal Studies say that Osborne manipulated departmental budgets by ordering them to deliberately underspend in the final two months of the year thus artificially reducing the deficit for 2012/13 and bringing the figure in below last year's deficit of £121bn for political reasons. This was revealed by examining a document produced by the Office for Fiscal Responsibility.

It is ironic that in 2010 Osborne said, "From now on we will have to fix the budget to fit the figures and not fix the figures to fit the budget"!!

If you want to dispute this please contact the OBR. Do not bother to abuse me. I merely report the facts.

James - if you were a financial manager then you would be irresponsible to over-fund any liability. This is called cooking the books. At the time of pension holidays funds appeared to be in surplus. It was not considered realistic to build in cover in case the markets bombed, and no one predicted longer life spans, extra annual Brown tax and minimal interest rates ahead. The taxman did not want companies to squirrel away profits from tax. Legislation was brought in to prevent excessive funding of pension funds.

It may suit your obvious hate of the organisations which create our wealth, but Greed is not an appropriate term. Of course the increased profits meant that prices could be held down to be more competitive and dividend to pension funds could be increased !!! :-)

Jon

Sorry, but you do talk a load of rubbish

James - a great pity you resort to such a comment rather than reason, logic and fact. I do happen to be a seasoned financial manager who has successfully run companies in the past.

Sorry Jon

Let's leave it there. Your 'facts' are obviously at variance with my 'facts'.

I don't wish to reveal the source of my knowledge but your comments about 'prices being held down' are hilarious. Prices of all the companies of which I have first-hand knowledge have sky-rocketed and so have profits and dividends.

Jon I do not hate organisations that produce wealth, but am realistic and knowledgeable of what happened with the 'Pensions Holiday Scandal'.

The companies that benefited actually approached the government first, lobbying to be allowed a contributions holiday - this was not an imposition by government, but an only too willing to oblige response.

You say " At the time of pension holidays funds appeared to be in surplus. It was not considered realistic to build in cover in case the markets bombed" - how convenient - its always possible for any company to 'whisk up' an expert (for money) to write a report saying anything you want to support a position justifying you taking actions to your financial advantage.

Stop being so niaive.

Jon

Exactly so, MoneyObserver. This corresponds exactly with my own knowledge of what happened.

You lot have got very short memories about pension contribution holidays.

The legislation at that time made it impossible to build up a "sinking fund". If your scheme was funded more than 105% (on an admittedly conservative basis) the legislation made you reduce the surplus, either by returning it to the employer or by taking a contribution holiday. If you did not reduce the surplus, it was taxed. The legislation was introduced by Chancellor Nigel Lawson in the late 1980s, but the real villains of the piece were the Treasury, who hated pension schemes accumulating tax-relieved money (and still do).

This law was quietly dropped in 2006 at the time of the so-called simplification, but by then the damage had already been done.

Funny - I've been a pensions lawyer for many, many years, and I don't remember employers lobbying the Government for contribution holidays. I do remember clients of mine complaining that they couldn't build up a surplus to tide the scheme over hard times.

But don't take my word for it - I'm sure you can find the old legislation on Google if you look hard enough.

At least we are agreed that contribution holidays were a very bad idea and at least a contributory factor to the present problems which some schemes have.

However, I do not recall that the companies involved were desperately unhappy about taking a contributions holiday, quite the opposite in fact.

Will Equitable Pensoners whose Pensions were transfered to Prudential Insurance Company, stll qualify for the £5000 the Chancellor stated in his Budget Speech

I'm abroad and beer is between £1.25 and £2.50 per 500ml (pintish). Cigarettes are 75p for a packet of 20 and fuel is 60p/litre and has been for the last 3 years. And what cretiin in the UK made big stores put covers over cigarette displays?? No wonder tax is high, it has to pay these consultative idiots!! A bottle of good Vodka is £5 and Income tax is a flat 10% on all earnings! It is simple! No need to buy counterfeit, no need to avoid tax and a night out does not eat up all your disposable income. Its marvellous and everybody pays! And BTW, the analysts in the City said Wetherspoons' concept was flawed! Well, not from what I have seen and its latest report. But for the poor independent these are sad times, oh and don't forget the pub's business taxes (my ex local was £45k/year for a small High Street bar!!!! Ridiculous! Lower the burdens and people won't need to avoid because it is not worth the effort!! In the mean time, come and live abroad, do some of your own avaoidance for a while, and look back smiling!! Oh, and the bank rate here is currently 8%p.a.!!!!!!

Where are you it sounds to good to be true!

Rightcharlie1.....Agree...worked 36 years abroad in two income tax free... unlimited ISA countries... with 100% exchange control freedom...these countries had strict annual work permit policies which were not renewed if you broke their laws... you were deported.... they never allowed you to earn citizenship or paid any benefits to non citizens...just like the UK?

Behave yourself and you were OK...blow the up and i hate to think what they would do to you...you would certainly not get a council house.

A Walls chocolate ice cream manufactured in the UK... having traveled 3000 plus miles... was sold for one third of the UK price....this coupled with a required wardrobe of only T shirts, shorts and flip flops....enabled capital at last to be achieved and rolled up tax free...for me the only downside was the lack of proper green grass..but the ability to swim in the ocean every day and save capital more than compensated...enjoy your time abroad and pay your UK Class 3 NI contributions each year...I called it my sterling high risk investment.

Nothing new again,but it does not matter even after that twit brown made all those stupid decisions he has never been bought to book for them and is still drawing a very nice salary ! Same will happen again no doubt !

Keith Fowler

Do you mean stupid decisions like saving the banking sector from total collapse with the subsequent loss of all your money?