I am writing this column on the eve of the UK’s ‘Government Budget’, and so I thought it would be an ideal subject to reflect upon. So what is The Budget ? In simple terms it is a projection of the Government’s revenue and spending for a particular period of time, often referred to as a financial or fiscal year. It is no different to a household budget where we look at the amount that is coming in and whether there are ways we can increase this, and then decide how we are going to spend it.
Some of the decisions or announcements have been more memorable than others and not necessarily for the right reason. I am not sure anyone is going to forget the budget of Liz Truss’s reign last September.
For me, the one that was most memorable was the 2014 Budget when the term ‘Pension Freedom’ was announced, when individuals no longer had to annuitise (secure an income from) their Pension at any stage. I heard someone refer to this as a “JFK moment”, and saying that if you ask the majority of our parents what they were doing when they heard about the assassination of JFK they can clearly remember. There have not been many events like this where we clearly remember exactly what we were doing when we heard about something significant, but I do believe that when ‘Pension Freedom’ was announced IFAs would remember when they first heard this news.
There is a lot of history surrounding the Budget which originates from the 1720’s. The red briefcase which carries the papers has been used for over a century and the chancellor is even allowed to consume alcohol whilst delivering it, which is the only time during a parliamentary debate that ministers may consume alcohol in the House of Commons.
There’s always plenty of speculation around what’s going to be in the Budget announcement, but only time will tell. Once all has been revealed, should you need some help understanding the implications and how this is likely to affect you personally, do not hesitate to call us for a free without-obligation consultation.
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