This year’s Budget was pretty political – which is no great surprise given the forthcoming
general election in May. There can be little doubt that a number of the Chancellor’s
measures were designed to attract voters. Non-pension savers, for example, were offered a
new personal savings allowance, which is worth up to £200 a year and are to be given more
flexibility and investment options for their ISAs after the election. The Budget is also likely to
be good news for existing pension annuity owners, who are to be allowed to sell their
income in return for a lump sum.
House prices and the difficulties of getting onto the property ladder are rarely out of the
news these days and the Chancellor has proposed to give those who aspire to own their
own home a helping hand – a new Help to Buy ISA. This scheme, due to start in August
2015, will see the government provide a £50 bonus for every £200 of monthly savings
deposited in this ISA, up to a maximum of £3,000 on £12,000 of savings.
Unfortunately, the Budget can’t all be good news for everyone. Those who have not yet
retired received a bit of a blow in the form of a further reduction in the lifetime allowance,
which the Chancellor has cut down to £1 million – a measure proposed by the Shadow
Chancellor in February.
So, we heard lots of interesting announcements in this Budget but whether these proposals
become legislation very much depends on the outcome of the election.