Chancellor George Osborne used the final Budget of this government to give sweeteners to both younger and older voters yesterday.
In an unexpected move, he introduced a new Help-To-Buy ISA, giving first-time buyers up to £3,000. “For every £200 [first-time buyers] save for their deposit, the government will top it up with £50 more,” Osborne said. This will be applied to savings up to £12,000, meaning buyers will have access to a total of £15,000.
For the critical older vote, there will be a new Personal Savings Allowance making the first £1,000 of savings income tax-free for basic rate taxpayers.
The pensions revolution also continued, with the chancellor outlining his plans for over-55s to be able to cash in annuities they already have.
Yet there was also a reduction in the pensions lifetime allowance, bringing it down to £1m from £1.25m.
The Lib Dems emphasised the implementation of one of their key policies of raising the personal income tax allowance. It will now be £10,800 from April 2016, and £11,000 a year later, giving the typical basic rate tax payer an extra £905 a year over the parliament.
Yesterday, Osborne struck a notably optimistic tone. With the election on the horizon, he declared: “The sun is starting to shine and we are fixing the roof.” Yet Labour leader Ed Miliband dismissed the chancellor’s positivity saying: “This is a Budget that people will not believe from a government who are not on their side.”