2011-12 Budget Announces Government Posts To Go

Redundancies A Possibility

Treasury Minister Anne Craine has delivered her first budget this morning in Tynwald, announcing hundreds of Government posts will need to be cut over the next year.

Despite staffing costs being down 8% on their projected level Minister Craine stated that 285 posts need to go in the next year, staffing was reduced by 99 posts last year.

She said that they can't rule out redundancies.

It was also announced that the public sector pay freeze will remain unchanged.

Taxation remains largely unchanged, however tax relief on both class 4 National Insurance contributions and Educational Deeds of Covenant have been removed, with the proceeds from the latter now going to Education and Children to help with the student award scheme.

The Minister identified that savings of £25 million will be made over the next year, with spending £11 million below last year's rebalancing plan.

It’s also been identified that the increase in VAT to 20% will generate an extra £25 million a year, this combined with reduced savings means that it’s unlikely they will need to dip into their reserves.

The cap on Mortgage and Loan Interest relief has been further reduced by £2,500 to £7,500 per person each year.

The Department of Health is the only one to get a budget increase of £7.5 million pounds.

The Minister finished by saying that the time ahead is going to be challenging, but this year’s largely positive budget reflects cautious optimism.

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