Darling announces UK budget for 2009

Thursday, April 23, 2009 

The Rt Hon Alistair Darling, MP, Chancellor of the Exchequer

The United Kingdom Chancellor of the Exchequer, Alistair Darling, yesterday announced the 2009 budget. The budget is an annual audit of the nation's finances, and decides what should be done with taxpayers' money.

The chancellor fell under scorn for his GDP growth forecasts, which are considered to be too optimistic in predicting that Britain will bounce back from its weakest economic performance since the end of the second world war. Darling forecast GDP growth of 3.5% in 2011, even after he was made to downgrade his predictions. He expects a record expansion of 1.25% next year, but chief UK economist Howard Archer disagrees, calling Darling's predictions "mildly optimistic in the near term and much more optimistic in the long term."

HAVE YOUR SAY
Was the increase in the ISA limit "too little, too late"?
Add or view comments

His plans for savers and pensioners, however, were commended by many, though was also criticised by a large portion of the populace. In the budget, Darling increased the amount that savers can put into an Individual Savings Account (ISA) from £7,200 to £10,200, of which £5,100 can be saved in cash. These increased limits will be available only to people aged over 50 from 6 October this year, and will not be available to everyone until 6 April next year. A number of financial experts described the move as being "too little, too late", and Rumina Hassam, of price comparison website uSwitch.com, said: "The government's decision to increase the cash ISA limit by £1,500 to £5,100 for the over 50's is a just another kick in the teeth for the majority of savers as they will have to wait even longer to benefit. There is no doubt that savers have been sacrificed as a result of the plummeting base rate, bringing savings rates to an all time low."

Departmental expenditure limits

The tables below show the government's plans for spending between now and 2011, although the 2010 budget may change these plans.

Resource DEL	Outturn 2007-08	Estimate 2008-09	Plans 2009-10	Plans 2010-11
Children, Schools and Families	44.9	46.8	49.2	51.3
Health	88.4	92.5	99.9	104.0
of Health: NHS England	86.4	90.9	98.2	102.3
Transport	6.8	6.5	6.4	6.4
Innovation, Universities and Skills	15.5	16.7	17.2	17.9
CLG Communities	4.2	4.3	4.5	4.5
CLG Local Government	22.8	24.6	25.6	26.3
Home Office	8.6	8.9	9.4	9.5
Justice	8.8	9.3	9.5	9.4
Law Officers' Departments	0.7	0.7	0.7	0.7
Defence	35.7	37.9	38.7	36.7
Foreign and Commonwealth Office	1.9	2.0	2.0	1.6
International Development	4.5	4.8	5.5	6.2
Energy and Climate Change	0.6	1.0	1.1	1.1
Business, Enterprise and Regulatory Reform	1.8	1.6	1.8	1.4
Environment, Food and Rural Affairs	2.7	2.7	2.7	2.7
Culture, Media and Sport	1.6	1.6	1.7	1.7
Work and Pensions	8.1	8.1	9.1	9.9
Scotland	23.8	24.6	25.4	26.1
Wales	12.3	13.0	13.6	14.0
Northern Ireland Executive	7.6	8.1	8.4	8.7
Northern Ireland Office	1.3	1.3	1.2	1.2
Chancellor's Departments	4.8	4.8	4.6	4.5
Cabinet Office	1.8	2.0	2.3	2.4
Independent Bodies	0.7	0.8	0.9	1.0
Modernisation Funding	0.0	0.0	0.3	0.3
Reserve	0.0	0.0	0.7	2.9
Allowance for shortfall	0.0	-0.6	0.0	0.0
Total resource DEL	309.9	324.3	342.1	352.3

Capital DEL	Outturn 2007-08	Estimate 2008-09	Plans 2009-10	Plans 2010-11
Children, Schools and Families	5.2	5.6	7.2	6.8
Health	3.8	4.6	5.6	4.8
of Health: NHS England	3.6	4.4	5.4	4.7
Transport	7.1	7.3	8.3	7.4
Innovation, Universities and Skills	2.1	2.1	2.6	1.8
CLG Communities	6.1	7.1	8.8	6.1
CLG Local Government	0.0	0.1	0.1	0.1
Home Office	0.7	0.9	0.8	0.8
Justice	0.8	1.0	0.8	0.7
Law Officers' Departments	0.0	0.0	0.0	0.0
Defence	7.9	8.6	9.1	8.8
Foreign and Commonwealth Office	0.2	0.2	0.2	0.2
International Development	0.7	0.9	1.4	1.6
Energy and Climate Change	1.5	1.7	2.0	1.8
Business, Enterprise and Regulatory Reform	0.0	0.0	0.3	0.3
Environment, Food and Rural Affairs	0.6	0.6	0.7	0.6
Culture, Media and Sport	0.5	0.8	0.4	0.6
Work and Pensions	0.1	0.1	0.1	0.1
Scotland	3.6	3.3	3.7	3.2
Wales	1.5	1.6	1.7	1.7
Northern Ireland Executive	1.1	1.1	1.1	1.1
Northern Ireland Office	0.0	0.1	0.1	0.1
Chancellor's Departments	0.3	0.3	1.0	0.3
Cabinet Office	0.3	0.4	0.4	0.4
Independent Bodies	0.1	0.0	0.1	0.1
Reserve	0.0	0.0	1.2	2.1
Allowance for shortfall	0.0	-0.2	0.0	0.0
Total capital DEL	44.1	48.3	57.7	51.6

Total	Outturn 2007-08	Estimate 2008-09	Plans 2009-10	Plans 2010-11
Depreciation	10.8	11.9	12.4	13.4
Total Departmental Expenditure Limits	343.2	360.7	387.3	390.5
Total Education spending	78.1	83.0	88.0	89.2

Sources

• HM Treasury. "Budget 2009" — The Stationery Office, April 22, 2009 (official treasury report)
• Larry Elliott. "Budget 2009: City pours scorn on Treasury's GDP growth forecasts" — The Guardian, April 22, 2009
• James Sturcke. "Budget 2009: at a glance" — The Guardian, April 22, 2009
• Myra Butterworth. "Savers and pensioners offered glimmer of hope in Budget 2009" — The Telegraph, April 22, 2009