2014 Government Budget: Taxing Your Future?

Helpful starting points/further reading: BBC Beginner's Guide to the Budget

The Gov.UK guide to government spending is more technical 

My previous blog post has many graphics, links and a short video

An unfortunate comparison, but this useful guide gives a quick summary of local gov. spending on p.12; I've also blogged on this before with many more resources!

older people vote – 76% last time. What is the point of easing the housing, jobs and debt crises of the young when only 44% bothered to vote? Low

earners don't vote much either, so the young/poor vote least of all. The IPPR shows how, since 2010, average voters lost 12% in service cuts, but those who didn't vote lost 20%, or £2,135 a year. So, Russell Brand, young people are badly treated if they don't vote. [Polly Toynbee, Guardian, 21.3.14 - lots of facts and figures on how decisions by both major major parties in recent years have hit young people]

Toynbee, above, criticises Brand; videos on Brand's controversial views here.

This can seem very abstract, and alien to teenagers who might not think this impacts upon them, but government budgets, and so their public spending plans, include how much more or less they will spend on schools for example, and how this money is divided up.

This Guardian article claimed that the budget targeted pensioners votes

There is an increasingly common point of view that this government - like its predecessors - puts the interests of pensioners above those of young people, basically because they are much more likely to vote. All of the broadsheet or 'quality' papers from March 20th 2014 (except the Telegraph) specifically mention the 'grey vote' on their front pages. We'll explore the press in more detail in another lesson.

Read what press expert Roy Greenslade made of the press coverage here.

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If you skip to 2:12 in, this BBC radio guide to the economy and public spending explains how it works if we imagine that the whole UK economy amounted to just 100 pennies ... from which more and more is going towards paying out pensions, putting pressure on spending on other areas, such as education.

Skip to 2:13 in, and this is a very user-friendly guide!

The Guardian reports that the 2014 budget, from 19th March 2014, was quite obviously pro-pensioner and unfavourable to youth (or 'Generation Y'), as the sample quote below illustrates:

It can be useful to have a grasp of the demographics of the UK; the map below (click here for the full-size image, here to read analysis of how the size of a youth population influences a country's politics) puts the UK into global context:

There are lots of reports on this year's budget; for example, you can find a 100 second video summary here from the Daily Telegraph, a right-wing paper, or select from a range of articles here from The Guardian, a more left-wing paper.

TASK RESOURCES:
As well as any of the above, you will have the following main resources to use for this task:

Interactive Telegraph guide to public spending - you can click (or just hover) on any of the circles, or the Department names, for further details.

Guardian pie chart graphic of public spending.

This UKPublicSpending.co.uk guide is not so user-friendly, but allows you to access some more detailed breakdowns.

This Money.co.uk guide to the main elements of the 2013 spending review highlights some of the key trends in government spending.

NB: the images below are only screenshots: click on the blue, bold underlined hyperlinks above to visit these sites/resources!

Telegraph guide: click/hover on bubbles or Department names for more detail

Guardian guide; zoom in to read the fine print!

The UKPublicSpending.co.uk guide: click on the + for more details

Money.co.uk guide - welfare is a key target for cuts; what is your view?

Budget, Revenue and Spending

The money raised by the government through taxation, assets and borrowing is its revenue, whereas the money paid out is known as government spending. We are currently experiencing widespread government spending cuts. Your generation could grow up with austerity the defining approach to government finance.
Every year the Chancellor of the Exchequer, second only to the Prime Minister in terms of seniority and authority within the government (and many would argue that Gordon Brown was more powerful as Tony Blair's Chancellor than when he became PM himself), sets out the government spending plans, including any changes to revenue-raising (taxes etc), in the Budget.

The Budget is the single most important economic and financial statement made each year by the Chancellor of the Exchequer to Parliament and the nation. The Budget Responsibility and National Audit Act 2011 require the Government to produce a Budget Report for each financial year. The Charter for Budget Responsibility sets out what the Budget Report must cover.  [source: http://www.hm-treasury.gov.uk/budget.htm]

Here's a short history of the Budget:



Every budget has winners and losers. In theory at least, Labour governments (at least before Tony Blair) would set budgets that reduced tax on the poor whilst increasing spending on the poor, using increased corporation (business) and wealth (income) tax to pay for this, while the Tories would cut public spending overall, especially welfare payments to the poor, and focus on reducing tax on the rich and business. The  2012 budget was extremely controversial: the so-called pasty tax (here's the BBC's take) seemed to penalise the poor while the richest saw their income tax cut from 50% to 45%.
After every budget the media quickly calculates who they think will the winners and losers, as do think tanks such as the IFS. The Guardian analyse the 2012 winners and losers from the autumn 2012 statement, which was heavy on welfare cuts, here.

TASK 1: LIST FORMS OF TAXATION
This is a very simple task that you can achieve by quickly browsing the relevant Wikis, hyperlinked above, and looking for the different forms of taxation they list. You should be able to find at least 9. They don't list Council Tax as they focus on national taxation. Write or type these 9, + Council Tax.

The Wiki on public finance is full of useful facts, including the range of taxes the government uses to raise revenue. There is also a separate Wiki on taxation.