Budget is seen to have negative impact on personal finances – London Business News | Londonlovesbusiness.com

Despite still performing negatively overall, Reeves’ long anticipated Budget performed better than three of four of the last four major fiscal events, according to Opinium’s latest polling.

The Budget, delivered earlier this week, received a net approval rating of -14%, which performed better than the 2022 Mini-Budget (49%), the 2023 Spring Budget (-15%), and 2024 Spring Budget (-20%).

The only major fiscal event which performed better than the recent Budget, was the 2023 Autumn Budget, which saw the reduction in National Insurance contributions, and a net approval rating of -4%.

Additionally, the Budget may have welcomed a change in view towards Reeves, who has struggled with negative ratings over the last few months. Despite still receiving a negative net approval at -18%, she sees an 11-point jump from two weeks ago. Keir Starmer saw a similar boost in ratings, seeing a 7-point jump to -24%.

Reeves’ Budget targets personal finances

In light of a tricky economic situation, the changes made by Reeves in her budget may be a necessary pill to swallow for many. Two in five (37%) think the budget measures were necessary, versus a quarter (28%) who think they are unnecessary – a net improvement from August, although only marginally.

On Wednesday, Reeves introduced changes such increasing the rate of employers’ National Insurance and increasing the lower rate of Capital Gains Tax. Overall, in the public’s view, the Budget is harsh on those on higher incomes, with over two in five (42%) thinking the budget will have a negative impact on them. This comes as 40% also think the changes will have a negative impact on their own individuals’ personal finances.

Although some perceive the Budget as unfavourable for higher earners, it scores much more highly on fairness than expectations from August, and many accept its measures as necessary (37%). However, the net rating is still negative, three in ten (30%) think the measures in the Budget are fair, compared to 38% who believe it is unfair.

In keeping with what might be expected from Labour, Reeves’ Budget was viewed favourably in its ability to fully fund public spending (39%); almost two-fifths (37%) also feel it did a good job at investing in the UK’s future.

Economy remains a concern

Despite the changes made by Reeves this week, the public remained very concerned about the economy. Three quarters are concerned about the general state of the economy (76%), second only to inflation and the cost of living (81%).

In spite of this fear, more people still believe that Labour is prioritising the balancing of the books over economic growth (36% compared to 29%). However, more people think the government are prioritising growth than in September, when 44% believed Labour was prioritising balancing the books.

Adam Drummond, head of political and social research at Opinium said: “Rachel Reeves’ first budget has relieved some pressure on the government after weeks of difficult headlines.

“Many Labour voters backed the party in hopes of greater investment in public services, and this week they got what they asked for, boosting approval ratings for both the chancellor and prime minister. That said, the government has only recovered ground it arguably should never have lost in its first three months in office.”