Why are we having an emergency Budget?

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Back in May, not long after the Conservative Party swept to a surprise victory, George Osborne announced there was to be an emergency Budget, held on 8th July.

So what exactly does this mean and why are we having one?

1. The number one reason for an emergency Budget is because we no longer have a coalition. The previous Budget was a Liberal Democrat/Conservatives collaboration, and the new all-Conservative government naturally wants to publicly assert their agenda for the next five years, based on their electoral mandate.

More specifically, the upcoming summer Budget is expected to incorporate the Conservative 2015 manifesto promise of £13 billion worth of cuts to government departmental spending and a further £12 billion cuts to the welfare budget. Commentators have been speculating over the last couple of months where the axe is likely to fall outside of the ring fenced welfare services, while business leaders and accountants have been publicly airing their views on what other changes they hope will be included.

2. While cuts remain the talking point in the news, there will also be other major announcements. There will be an update on growth forecasts from the Office for Budget Responsibility prepared especially for this Budget and George Osborne is also expected to speak on his proposed new law, which will commit future governments to a target of budget surplus during benign economic conditions.

3. The budget will also reiterate the provisions of the March Budget that will still apply and clarify any policy changes, for example which provisions will be removed. Therefore the previous budget will not be rendered void as such but rather will be incorporated into the summer Budget where applicable.

Why is it referred to as an emergency Budget?

It’s not as if the country will collapse without it, but there is an urgency from the Conservative’s perspective to implement their plans as soon as possible in order to achieve their aims while they remain in power. The term ‘emergency Budget’, however, refers to the fact that it falls so early in the new parliamentary term, just six weeks after the state opening of parliament on May 27th. Osborne’s budget in 2010 was also an emergency Budget as it came soon after the coalition was formed, though it is particularly unusual to have more than one budget in a calendar year delivered by the same chancellor.

Why didn’t we hear about the details of the Budget before the 2015 election?

There are of course opposing views on this. The government has explained that no detailed announcement was made before they were sure they knew exactly where the cuts could be made. The manifesto pledge was based on overall savings they believed to be necessary and achievable but according to Iain Duncan Smith, to announce the details of the summer Budget would have meant they would have ‘had to have done the work’ first. Meanwhile, opponents say the Conservatives did not want to reveal anything for fear of losing votes.

That’s the why covered – now, where can you follow updates on Budget day? YourAAT will be live-tweeting the event, so keep an eye on our feeds for announcements and commentary as it happens.

Kayleigh Ziolo is a freelance journalist and writer based in Ireland.

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