Beer drinkers may raise a glass to the Chancellor tonight, and drivers filling their cars with petrol will be pleased to hear that there will be no further increase in fuel duty, but people aspiring to become home owners are the real winners of this year's budget statement.
The new 'Help to Buy' scheme announced today will make owning a new home a possibility for the many people who are currently unable to move or buy a place of their own because the deposit required is too large for them to afford. High house prices mean that people currently have to try to save tens of thousands of pounds to put down a deposit of 25% of the value of the property. Under George Osborne's new scheme the government will be able to offer a deposit of 20% of the value of a new build property, with the home buyer typically just having to find the remaining 5%. This deposit loan from the government is only repayable when the property is eventually sold. This scheme will be open to anyone, regardless of their income, and for any new property worth up to £600,000. In addition to this, the government is offering to act as a guarantor for mortgages for people looking to borrow to buy any type of property, new or old, which will again help people who might not be able to afford to put down a large deposit.
This initiative will give lenders the confidence to offer higher loans against the value of the property. The 'Help to Buy' scheme will unleash the aspiration of the many people who want to move or buy their first home, and in so doing provide a massive boost to the whole housing market. House builders will have more confidence to build, knowing that there are more buyers in the market. People now able to move up the housing ladder, will be making more properties available for others to buy or rent.
This budget was focused on the need for a serious plan for Britain to start to pay its own way, rather than looking to borrow even more than we have done already. The national annual deficit is now down by a third and as a result of this we have record low interest rates.
Economic recovery is coming from the government supporting people's aspirations to own their home, work and start and run their own business. We have more private businesses in the economy now than ever before. Private businesses have created 1.25million jobs since 2010, and will create a further 600,000 this year. To help that growth in jobs, small firms will now benefit from cuts in employers national insurance contributions, and the overall level of company tax is being set to 20%, down from 28% in 2010; this means British firms will be paying the lowest levels of tax of any major economy in the world. We need to get behind the aspirations of the people and this budget was designed to do that.