Election Betting.com

Imagine the scene. Six weeks before England’s opening match at this summer’s World Cup – a tournament England have an outside chance of winning – Fabio Capello stands up in front of all the opposition managers heading to South Africa and tells them that his team’s form has been rubbish over the last few months, and shows no sign of getting better. He does, however, stress that he thinks he and his coaching staff are the men who can improve England’s fortunes.

It would be ridiculous, wouldn’t it?

And yet, with the Budget scheduled to take place on 24th March – just six weeks before the General Election – that’s the scenario the Labour government find themselves in today.

Alistair Darling will deliver one of the most eagerly awaited Budget speeches in recent history on 24th March. With Gordon Brown and Labour set to argue that a change of government would damage the nation’s economic recovery, the plans to be outlined in the last Budget before the General Election could either make or break Labour’s chances at the polls.

Darling and Labour have a huge problem. The ideal political Budget offers some nice financial incentives to voters such as a small tax cut, perhaps, or a freezing of duty on cigarettes or booze. However, any such measures this time around will be pounced on as irresponsible when Britain has borrowed several hundred gazillion pounds in recent months as a result of the credit crunch and financial crisis.

Darling has to appear to be in control of reducing Britain’s deficit, whilst not announcing any measures so stringent that it alienates millions of voters already struggling financially. It’s a tightrope as thin as Liverpool’s chances of playing Champions League football in 2011.

The easiest way for Darling to tackle Britain’s huge deficit is to raise taxes and duties in order to generate additional revenue. If Labour were assured of a safe election victory he could increase the road fund licence, National Insurance, income tax, VAT, duties on cigarettes and alcohol and Corporation Tax.
However, they are a lengthy 4/1 to win most seats at the forthcoming Election and so hitting every voter in the pocket with tax increases isn’t the brightest political decision Labour could make. However, a rise on duties is almost expected by voters and so he does have an easy way of making a few quid there. It’s 1/3 that duty on cigarettes increases, and 2/3 that we pay more tax on booze.

Changing major taxation rates is more unlikely however, as this generates headlines and negative mutterings from voters. It’s an evens chance that the highest rate of income tax remains at 50p and 5/4 that Darling increases it by up to 5p in the pound. The 10/11 on Corporation Tax being unchanged looks about right, as does the 8/13 on VAT being left at 17.5%.

Where Darling could save money, however, is on Jobseekers allowance. If he froze the benefit (a 2/1 chance) it would save the Government millions of pounds, although with increasing numbers of people out of work it might hit their vote in key marginal areas where unemployment rates are highest.