Millions Fear They Will Be Worse Off After Budget
Published: 25 June 2010 By MoneyHighStreet Staff 1 Comment
Two thirds of consumers say that the budget will make them worse off and over a quarter of us will be cutting back on spending, research by uSwitch has found.
According to the findings, 67% of consumers, around 33 million people, say that the budget will make them worse off than before. In addition, 27% of us will be cutting back on spending as a result of the measures outlined in the budget.
With over half of consumers now feeling less confident about their finances, the austerity measures announced in the budget seems to have strengthened many peoples’ view that the country’s finance will now be healthier, although 32% of respondents believe the recession may be longer than first thought.
The VAT increase scheduled for January 2011 looks to be changing some consumer spending plans as over 9 million people now intend to bring forward large purchases to beat the VAT hike.
Overall, the uSwitch research indicates that the message that a period of austerity is mandatory for the economic health of the country, however the personal finances of the individual are likely to be put under pressure as a result.
Consumers should be looking to find the best deals possible, advises Ann Robinson, Director of Consumer Policy at uSwitch.com, who said:
“Consumers should look at combating the impact of the Budget by cutting back painlessly on household bills. It’s estimated that the increase in VAT will cost the average family an extra £500 a year – you can easily claw this back by ensuring you are paying the lowest possible price for the basics.”
“This will free up some cash so you can carry on enjoying your current standard of living. It will be a challenge, but at least most consumers recognise a more positive future for the country, which will in turn mean a better future for them individually.”
Well in a way this is good news because a third of people don’t believe they will be worse off. The great part of this budget was for businesses large and small and it’s the private sector that’s going to get the economy going in the next few years so reducing corporation and small business taxes was a great move. Of course increasing the VAT is going to sting a little but the increase for £1000 purchase is just £25 and there is still not VAT on food, books and children’s clothes so the basics we buy will have no effect and there were no changes for our largest expense – the mortgage payment. All in all I thought it was a good budget.