Pensioners will be hit hardest by latest Budget

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The Chancellor’s Budget speech held few surprises but some good news for businesses.

Most key announcements had already been leaked, including a reduction in child benefits and the cutting of the 50p tax.

The most controversial announcement was that from April 2013 pensioners will no longer receive a higher personal income tax allowance.

Daphne Savage, chief executive of Age UK Suffolk said: “We welcome the Chancellor’s announcement that the Government is to bring in a flat rate pension.

“However it is important that the Government does not lose sight of the needs of current pensioners, 1.8 million of whom are living in poverty.

“Someone with an income as low as £10,500 who reaches 65 from April 2013 could be £259 a year worse off than under the current system.”

Despite calls from MPs and the public the Chancellor did not announce a retraction of plans to increase fuel duty in August.

David Ruffley, MP for Bury St Edmunds, said: “I was disappointed that the Chancellor did not find savings from public expenditure in order to cancel the 3p fuel hike this coming August.

“We have the highest fuel duty in Western Europe and it’s crippling rural areas like Suffolk where a car is not a luxury it’s a necessity.”

Businesses received some good news, corporation tax will be cut to 24 per cent from next month and Sunday trading laws will be relaxed during the Olympics.

The Chancellor also announced that the Government would expand its enterprise finance guarantee scheme through which it guarantees bank loans to small businesses.

Andrew Denny, chairman of Bury St Edmunds Chamber of Commerce, said: “What we need in order to continue the recovery from recession is more jobs and more profitable companies who retain more of their profits so they can continue to grow, so the reduction in corporation tax is very welcome.”

“Enterprise plans are a good initiative and in West Suffolk we have a good history of successful start up businesses, I do not necessarily think it will create much more employment but it will help businesses prosper in the longer term.”

n Nick Plumb gives his budget verdict on Page 37 and on our website.