Post Budget Analysis - Rolling Notes

1345 Summary of Measures:
VAT up 2.5% from Jan 2011
CGT up 10% from midnight
Bank Levy from Jan 2011
Child Benefit Frozen
Variety of Business taxes eased
25% cut over 4 years in Deparment Budget bar Health and International Development
2 year freeze of Public Sector Pay

1355 Instant Analysis:
Chancellor banking on the Coalition lasting for 5 years as would not want to go to the country with this set of cuts.  And without seeing if this has worked.  Rather than dripping cuts this seems to be all in one go - as recommended by Canadian and Irish models. 

Risk is a double dip recession but hopefull the honesty will avoid that rather than causing long-term uncertainty. 

Lib Dem impact is not clear - felt a very Tory budget: helping business, creating smaller government and removing some allowances. 

Higher Education: Department of Business, Innovation and Skils budget has been cut by 25% despite increases in some funds for business creation.  Instant thought is that there will have to be at least a 25% cut for UK's universities.

1403 Just done word search in the actual Budget Document for Universities and Higher Education.  Only a couple of references and the key one of which is the selling off of Part of the Student Loans Company.  No surprise but yet another prediction of the Browne review.  Hopefully, lots of clauses to protect the loans from too large an interest rate on the loans.

1413 FTSE down about 1.3%, GBP/USD up 0.2% GBP/Euro up 0.4%.  Nothing too serious thus far.  Waiting for people to go through the detail.

1430 So quite a busy day over at Westminster, the media village is going mad on our boxes and I suspect the Palace is buzzing.  From my point of view, I suspect that the University of Westminster is busy working out what the impact is and awaiting the details of the specific budgets to come out of government departments.  It's not looking good for the sector in terms of pay, in terms of finding new income and in terms of the service we can offer.  More to follow, I am sure but off to take stock after what has been a fascinating and, once again, historic few hours.  Coalition Government and an economic crisis have led to some interesting times.

1500 Deloitte Poll (which is probably mostly answered by Business Folk) has come out saying that the budget is tough but fair (70% agree to 30% against).

1658 So Universities UK have published some reaction to the Budget.  They criticise the VAT increase as damaging some of the cost basis and has worked out that a 25% cut equates to £3.6bn for the sector.  Finally, they emphasise the impact that knowledge and research hs to the income.  Nothing surprising but there is a feeling that there is not much to be done.

1713 FTSE ends day down just short of 1% and Stirling down less than 1cent against the Euro & Dollar.  A very calm reaction and hopefully indicating no concern so far on the part of the markets.