MP reflects on BUDGET 2010: Pension success but pain ahead

Monday, 28 June 2010

After two decade of fighting for it the Lib Dems have succeeded in restoring the link between pensions and  earnings It was incorporated in the Coalition agreement at the insistence of the Lib Dems and in the budget the Chancellor announced “a triple lock that will guarantee each and every year a rise in the basic state pension in line with earnings, prices or a 2.5% increase – whichever is the greater.”

This is a landmark decision that puts right the breaking of the link with earnings under Mrs Thatcher.

There will be a lot of number crunching still to do but the strategy is now quite clear - to encourage business growth and not massive public and private debt.

That’s why I am pleased to see the financial incentives for new jobs and businesses in the North West and the priority given to new capital schemes that boost the economy.

The tightening of benefit rules, VAT increase and public sector savings though obviously have an impact but we cannot base our future prosperity on unlimited government borrowing and spending. The interest on the colossal   £150bn of  annual government debt comes out of everyone’s pay packet as tax and achieves nothing.

We have just got to take the country out of the hands of the moneylenders.

It going to be tough for everyone with the ever present risk of the government getting the balance wrong but surely an enterprise led recovery is the only sustainable option for the North West.