Despite some of the deepest public spending cuts since the beginning of austerity coming into effect in 2016, Chancellor Osborne, in his 2016 Spring Budget, announced plans to cut yet more, saying that there would have to be a 50p saving on every £100 spent by the Government and a further £3.5bn cut to spending in 2019/20.

More spending cuts will impact heavily on the public sector’s ability to provide services, however, the Chancellor has announced tax cuts  that will benefit business and higher earners.   Department of Work and Pension Secretary, Ian Duncan Smith resigned his cabinet post in protest at the decision to cut tax for higher earners while removing support for disabled people, criticising the Government for the narrow focus on cutting working age benefits to reduce the deficit.  Following his resignation, the Chancellor announced a u-turn on the PIP policy, which he now admits was a mistake.

The Chancellor intends to raise £12bn in revenues by cracking down on tax avoidance and closing a number of loopholes that have benefited multinational companies, however, corporation tax will be lowered to 17%.

Other measures include:


  • An increase in the Income Tax threshold to £11,500 by next April to rise to £12,500 by 2020.
  • An increase in the 40p tax threshold to £45,000 from next April.
  • The threshold for small business rate relief is to increase from £6,000 to £15,000.
  • From April next year 600,000 small businesses will pay no business rates.
  • Fuel duty frozen
  • £1bn tax cuts for the gas and oil industry
  • A sugar tax on soft drinks
  • Duty freeze on beer and spirits, but wine will see a 2% increase


  • Tax relief on financial advice.
  • “Help to save” for lower income savers.
  • Increase in the Isa limit to £20,000.
  • New lifetime Isa for £4,000 of savings per year.

Climate change

  • An increase in the climate change levy from 2019.
  • An end to the carbon reduction commitment energy efficiency scheme.
  • £730m to back renewables.

In addition to these measures, growth forecasts have been revised downwards from 2.4% to 2%, meaning that the economy is not doing as well as expected.

GCVS welcomes the u-turn on PIP, which would have removed this financial support entirely for hundreds of thousands of disabled people.  We worked with Glasgow Disability Alliance to develop a response to the Government consultation on Personal Independence Payments in December 2015.  In our response we argued that:

  • The nature of the Consultation displayed a fundamental lack of understanding of what it means to live with a disability;
  • The options proposed contradicted the purpose of PIP – to enable people to live independently; and
  • The number of points awarded to people who use aids & appliances should, if anything, be increased.


Source: The Guardian