George Osborne and Ed Balls trade pre-Budget blows

Ed Balls and George Osborne Ed Balls and George Osborne appeared on the Andrew Marr Show three days ahead of the Budget

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Chancellor George Osborne and shadow chancellor Ed Balls have set out their competing messages ahead of the Budget on BBC One's Andrew Marr Show.

Mr Osborne said the coalition's welfare reforms were "one of the most progressive things that any government has ever done".

He also revealed that the Help to Buy scheme for newly built homes would be extended to 2020.

But Mr Balls accused him of failing to stem the UK's "cost of living crisis".

The chancellor said: "I'm a low tax Conservative. I want hard-working people on all incomes to keep more of their income tax free."

'Perverse incentives'

His priority had been to increase the personal allowance on which no income tax is paid, he said.

This had taken the lowest paid two million workers out of tax altogether - but also helped those on higher incomes, he added.

Start Quote

There was nothing that could have been done pre-crisis to raise taxes or to cut spending which would have made any difference”

End Quote Ed Balls Shadow chancellor

Mr Osborne also said he had frozen fuel duty "year after year" and had "helped to keep council tax frozen".

He continued: "We had a welfare system that not only we couldn't afford but also we had these very perverse incentives that made it better for some people to stay out of work than be in work.

"We're changing all of that, and the reforms that Iain Duncan Smith and myself have brought in are one of the most progressive things that any government has ever done."

The chancellor also said the government's Help to Buy scheme had "helped people into homes, and... helped build new homes".

"I want to extend the help to buy scheme for newly built houses - it was going to end in 2016; we are now going to extend it for the rest of the decade," he said.

"That will mean 120,000 new homes."

George Osborne said the government's initial plan was to build 15,000 new homes in Ebbsfleet

He also announced plans to build a new garden city in Ebbsfleet.

But Mr Balls said the government was not investing enough in affordable homes and had presided over the "lowest level of house-building since the 1920s".

"If you boost demand with Help to Buy and don't do enough on supply, the price goes up, it's harder to get into the housing market, the economy becomes more unbalanced and the cost of living crisis gets deeper," he told BBC Radio 5 Live's Pienaar's Politics.

Bank levy

Earlier, on the Andrew Marr Show, he had said the chancellor was "only ever tough when he is having a go at the weak and the voiceless".

By contrast, he argued, Labour would "take away the winter allowance from the richest pensioners", "re-introduce the 50p tax rate on incomes over £150,000" and impose a "mansion tax" on properties worth more than £2m.

A future Labour government would also use a bank levy "to pay for more childcare for working parents", bring back the 10p income tax rate, and abolish the "unfair and perverse marriage tax break, which George Osborne has given only to a third of married couples".

"These things are all paid for. I am not making any spending commitments which we can't say how we'll pay for them," he said.

Labour's proposed spending is all "paid for and costed", says shadow chancellor Ed Balls, and highest earners will pay more tax

The shadow chancellor also defended the previous Labour government's record in office on public spending.

"There was a global financial crisis," he said.

"At that point, we had the lowest level of national debt of any big country and George Osborne, the Conservative shadow chancellor, had matched Labour's level of public spending.

"Am I going to apologise for the level of public spending that George Osborne, Alistair Darling and Gordon Brown agreed on in 2007? Absolutely not.

"What we did on the NHS was hugely important, the national minimum wage, not joining the euro.

"The economics of this is that we had a very low deficit [and] low national debt before the crisis. What happened was a collapse in tax revenues because of the crisis.

More on Budget 2014

"There was nothing that could have been done pre-crisis to raise taxes or to cut spending which would have made any difference."

The two MPs also took to the Sunday tabloids to set out their policies.

Writing in the Sun on Sunday, Mr Osborne pledged to build what he called a "resilient economy".

But Mr Balls, in the Sunday Mirror, said millions of people were not feeling any benefit from economic recovery.

Meanwhile, Liberal Democrat Chief Secretary to the Treasury Danny Alexander also hailed rises in the personal tax allowance.

Writing in the Mail on Sunday, he said: "I made it clear at our spring conference last week that further rises would be a top priority for our party in any negotiations that might be required should the British people deliver a hung parliament.

"We aspire to raise it substantially to £12,500."

He also said the Lib Dems were committed to sticking to the plan to eradicate the deficit and get the nation's finances on a firm footing by 2018-19.

"That means that there is a period of further deficit reduction required after the next General Election."


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  • rate this

    Comment number 553.

    Why not do something that helps everyone ( not just those who earn enough to even pay tax) and reduce VAT. Everyone wins and it gets the economy moving. It worked last time - something George conveniently forgets.

  • rate this

    Comment number 552.

    The LIBLABCON is over for me,none of them will get my vote!

  • rate this

    Comment number 551.

    @526. Whatsyourproblem

    " It is an Etonian thing that seperates the "US" from "THEM"."

    That would explain why it comes across as so arrogant and condescending.

    Come 2015 however, I, for one, will not be doffing my cap.

  • rate this

    Comment number 550.

    544. Been saying exactly the same for years but I advocate 25 percent but keep increasing the allowance threshold. The thing is you will always get those on medium to low income saying the rich are getting away with it (with this system they probably would pay more) and the have nots/envious wanting what the haves have and thus becoming the haves themselves. You cannot win in this Country.

  • rate this

    Comment number 549.

    546. Ridiculous comment. £10 hour minimum wage would result in massive unemployment!

  • rate this

    Comment number 548.

    ask yourself this question would you buy a used car from either of them

  • rate this

    Comment number 547.


    He had little choice but to adopt Labours spending plans. Any massive (but probably necessary) cuts to public spending would have been met with public outcry especially during a recession.

    The left are still in denial that Labour overspent during the boom period they presided over, unbelievable.


    Dress it up however you want but the fact remains Labour overspent as per usual.

  • rate this

    Comment number 546.

    I also think abolishing the BBC licence fee which is, in effect another tax, would be a good idea, as would abolishing VAT from a raft of essential items needed for daily living such as utilities. Also the threshold of taxable income needs to be raised to £12,500 & a minimum wage of £10/hr across the UK. Anything less is unreasonable & unrealistic.

  • rate this

    Comment number 545.

    539 Muiriel
    You are forgetting banking, you have crooks investigating crooks there.

  • rate this

    Comment number 544.

    the way they are going the starting rate and the 40% rate thresholds shoud meet soon, so you will either pay nothing or 40%, maybe that what they acually want.
    It would save time and confusion if they just had a flat 20% rate, no allowences/loop holes, just the one rate for all.

  • rate this

    Comment number 543.

    Both sides are rotten to the core. The bankers & big business run the show & Joe Public has no say, no say at all.

  • rate this

    Comment number 542.

    533 Chubby

    Public spending was pre the global financial crash was at a level that achieved political consensus. This is demonstrably true as it is a matter of factual record that George Osborne adopted Labour's spending plans in 2007. Si if it was out of control as you suggest, then George didn't agree at the time.

    Strange that everyone is wise with hindsight!

  • rate this

    Comment number 541.

    It's a global economy, that's true, but local communities must be enabled.

  • rate this

    Comment number 540.

    You don't seem to know the difference between a cyclical deficit and a discretionary (structural) deficit. The increase in the deficit from 2008 happened because of a collapse in tax revenue associated with the recession - there were no give-aways that caused that.

  • rate this

    Comment number 539.

    Amazing how Politics seems to be the only profession without some sort of regulation (self or otherwise). Demonstrate the sort of incompetence in office and general untruthfulness that the average UK politician exhibits in any other industry and you'd be going to gaol pretty quickly.

  • rate this

    Comment number 538.

    GB was Ball's and Milband's mentor and doesn't it show. Wasn't it ED that said Govt policies would drive up unemployment to 3m+ it's now 2.3m. Didn't he say there wouldn't be any growth it's now higher than most of Europe. Why put in a 10% tax and take out only to put it back in again, why live with 40% until 6 weeks before being kicked out he's just trying to be popular. GO marginally better!!!!

  • rate this

    Comment number 537.

    Wait a minute........2 Satan's?

  • rate this

    Comment number 536.

    The whole situation in the world is absurd. There are very obvious solutions to the issues we face, but nobody wants to implement them for fear of being labelled a communist. Why have we issues? Uneven distribution of wealth. Who has shouyldered the burden of the crash? The poorest, all the while the richest get richer and we continue to pay yo more to recieve yo less. Absurd.

  • rate this

    Comment number 535.

    497. john
    (Cont) Of course without tax credits the benefits bill would be smaller but then we really would resemble the third world with literally hundreds of thousands of people if not millions unable to feed themselves or their children, Investment would have gone elsewhere if the government had been unwilling to make up the poor wages being offered in trickle down eco world,

  • rate this

    Comment number 534.

    As the NHS has now officially been privatised, NI also needs to be abolished. Governments are quick to impose taxes when it suits them, very reluctant to abolish or reduce them except in election year!


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