Smoke and mirrors is how Brian Madderson, chairman of RMI Petrol, described the Budget. He said: "The Chancellor failed to mention that, in
addition to the 1ppl duty increase from April 1, he has already taken measures to claw back a duty incentive provided to the refiners for biofuels production. This latter measure will result in an increase to the cost of product by up to 1ppl also from April 1.
"Thus the real increase to the motorist at the pump will be 2ppl plus the VAT multiplier equating to around 2.35ppl some 135% more than might have been perceived from his speech. This size of increase does not sit well with his promise that "This is a Budget to secure recovery" especially with further duty increases now advised for October 1 and January 1, 2011."
There were the usual increases in duty on tobacco and alcohol. Tobacco product prices were raised by 4%, which the Tobacco Manufacturers’ Association said would "delight the smugglers".
The Society of Independent Brewers slammed the 2% above inflation rise in beer duty but welcomed the 10% above inflation rise on cider, designed to create a more even playing field between beer and cider. However cider companies were not happy. Roger Jackson, commercial director of Westons Cider said: "Cider has been a great success story. The investment in the industry as a whole has doubled the value of the cider market and doubled the contribution we have made to government; all that is now at risk."
Meanwhile, both the Association of Convenience Stores (ACS) and the Scottish Grocers’ Federation were concerned about the increase in the minimum wage. The new rates, which come into effect on October 1, include a 2.2% increase for those aged 21 upwards, to £5.93 an hour.
ACS chief executive, James Lowman, said: Throughout his Budget speech the Chancellor stressed the need to support the economic recovery and not to threaten jobs. We know that when faced with increases in the minimum wage retailers will cut back on jobs and hours, so we think this is an ill-judged decision."
However, the Forum of Private Business said it was celebrating key victories for small firms. The Forum’s chief executive, Phil Orford, explained: "While we’re sceptical of the motives behind some of the measures in the Budget, coming so soon before a General Election, there are some reasons to celebrate."
These include the four-year extension to the HMRC’s Time to Pay Scheme and a new Credit Adjudication Service with powers to overturn loan refusals.