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 693.

    @677. toorie
    but don't forget......there is a Indepedence Election first, in Scotand on Sept 18th
    What will Osborne and Balls do if Scotland says YES! ?
    This would certainly throw a spanner in the works for the House of Commons
    They'll have to think again.


    Another good reason for Scotland to say YES, and I'm an Englishman.

  • rate this

    Comment number 692.


    Imagine if only 10% of British people voted in a general election.

    Then there would be change.

    You know full well that whoever you vote for, will just take your vote ... and laugh in your face.

    Time for a Crimean-sized change.

  • rate this

    Comment number 691.

    Property did not devalue sufficiently during the crash of 2008 onwards due to the smoke and mirrors of zero interest rates , the real rebalancing will be done at the next crash when those rates are already low and nothing will be able to stop it, any rate rises between now and then will also crash it, you cant keep inflating a market whilst wages lag behind, something has to give in the end.

  • rate this

    Comment number 690.

    Good to see "back to basics": as partners

    hostile@17 "let's not spend more than we earn" together with 'let's not spend less than we earn', excellent sentiments given allowance for "common-sense", maintenance of circulation, maximisation of value, coping with inevitable swings around 'balance' (in modest personal savings, & in sensible levels of carry-forward, credit & debt, at accounting points)

  • rate this

    Comment number 689.

    "Most politicians are in it to get as much for themselves as they can."

    As if the rest of us are any better. Self preservation is in our nature.

  • Comment number 688.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 687.

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

    Well I've heard it all now.

    Some Labour poiticians have said they made "some mistakes" but Ed it seems is in complete denial.

  • rate this

    Comment number 686.

    All I can say is God help us if Ed Balls is ever Chancellor! I think Osborne has got a lot of good ideas. He can only do what he can with what he has got. The only thing I would change is the billions we give away in aid. We can't afford it at the moment, we need that money at home.

  • rate this

    Comment number 685.

    673. paul bad
    Ah Paul but it’s not a housing bubble is it, because it’s an investment bubble, we don’t live in houses anymore we live in investments, it’s such a good scheme that home ownership (the Tory dream) is going down, so lots of rents for landlords to collect many in the form of benefits.

  • rate this

    Comment number 684.

    Why not put put all tax on goods and property and get rid of income tax, the more you earn the more you spend the more you are taxed.
    Also you have computers buying and selling shares in seconds using maths way above an average investor, if you buy shares you should have to keep them for at least one week.

  • rate this

    Comment number 683.

    Why do Labour politicians insist on calling it the Mansion tax when they know that the majority of payers from London and the southeast live in flats and terraced houses? Rhetorical question..
    I purchased my house 35 years ago and will be forced to sell. I am not a fat cat I dedicated most of my working life to public service in a relatively low paid job.

  • rate this

    Comment number 682.

    We need fewer MPs, 300 would do for England, who are in effect part time, people immersed in the real world, in real jobs. New parties, or old parties radically changed, would naturally emerge to serve real needs. Then a second elected chamber of around 100 or less 'senators', or equivalent. The phrase 'political elite' sums up the error of our times. We need politics of, for and by the people.

  • rate this

    Comment number 681.

    @544. confusedtaxpayer

    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.


    Yes, they want the majority to be squeezed into a small band either side of the median income bracket as that is the only way the state will ever eliminate relative poverty as it is currently measured.

  • rate this

    Comment number 680.

    I wouldn't trust Balls and Millipied to push an empty pram. It was these 2 who created your current mess.

  • rate this

    Comment number 679.

    Two politically bald men fighting over an economic comb.

    At least the Labour wanna be had the guts to name himself after his policies.

  • rate this

    Comment number 678.

    So, Osborne & Balls ... in their hands lie our economic future ... all I can say is God help us !!

    To add insult to injury, their biggest achievements include steaming ahead with a staggeringly expensive rail line most people don't want (and couldn't afford to use anyway) and outsourcing our energy generation to Asia.

    At least we're all in this together hey boys ... if only.

  • rate this

    Comment number 677.

    669. johnboy99 "Roll on 2015 and the next election, you will be getting such a boot up you know where"
    but don't forget......there is a Indepedence Election first, in Scotand on Sept 18th
    What will Osborne and Balls do if Scotland says YES! ?
    This would certainly throw a spanner in the works for the House of Commons
    They'll have to think again.

  • rate this

    Comment number 676.

    Good to see some thinking!

    Hamish Cameron @571,584
    Listen to David Davies on Tony Benn

    An honest politician telling no protection with even a Labour Cabinet

    Labour or Tory, we need our leaders to set the people free, as equal partners all enabled defend ourselves and each other, to have rational trust in each other, and so to advance 'in it together'

  • rate this

    Comment number 675.

    No666, jgm2'

    'only a fool'

    Only a fool thinks MPs 'run' a free market economy.

    The ruling class love idiots.

  • rate this

    Comment number 674.

    The hectoring, 'ignore the facts', 'kick 'em' Tories are out in force on here today.

    The truth is that mainstream politicians argue over very little.

    The only real difference is that the Tories protect the rich & kick the poor, while Labour protects the poor from penury.

    Because they have to justify protecting the poor with taxes from the richer, Labour have to be the more professional.


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