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Imminent Pre-Budget Report stirs debate

Imminent Pre-Budget Report stirs debate

Category: Economy

Updated: 04/12/2009
First Published: 04/12/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Various groups have called on the Government to help homeowners, pensioners and savers ahead of next week's Pre-Budget Report.

The Chancellor of the Exchequer, Alistair Darling, is scheduled to deliver the report next Wednesday in an address that is expected to be dominated by the recession.

Ahead of the announcement, the Association of Mortgage Intermediaries (AMI) has called for the Stamp Duty regime to be reviewed as a matter of urgency. House buyers are currently enjoying a break from the tax, a benefit that has been cited as a major reason for the slight improvement in the mortgage market.

However, the holiday is to expire in the New Year – a move that has been strongly opposed.

"Stamp Duty places a disproportionate burden on first time buyers. Many are unable to extend their borrowing to cover the additional cost of stamp duty," commented Robert Sinclair, director of the AMI.

"The current holiday on the duty should be extended until the market has recovered. By helping more first time buyers onto the property ladder, this extension can serve to revitalise the market."

The Royal Institution of Chartered Surveyors has also added its voice to the debate, saying that the removal of the holiday will be a challenge the housing market has to face in 2010.

The National Association of Estate Agents (NAEA) has weighed in, urging the Government not to be short sighted. "The Government, at the very least, must extend the Stamp Duty holiday that is currently scheduled to end in December," said Gary Smith, president of the body.

His comments came after figures showed that members of the NAEA reported a year on year increase in first time buyers in the housing market – accounting for more than one in five buyers (22 per cent) in October.

"The danger is that this short-sighted policy could precipitate an unwelcome pause in the housing market at the start of the New Year."

In the savings market, the Building Societies Association (BSA) has asked the Government to do more to help savers.

Director-general of the BSA, Adrian Coles, said: "Allowing the two-way transfer from stocks and shares ISAs to cash ISAs would give savers more flexibility in managing their money.

The latest body to publicly call on the Government to implement changes is the National Association of Pension Funds (NAPF), which has asked the Chancellor not to dodge what it calls a golden opportunity to help millions of pension savers.

NAPF has asked for the long term needs of pension schemes to be met, helping member of both defined benefit and defined contributions schemes.

"Pensions have been placed under considerable strain during the recession and the Government has a golden opportunity next week to improve the retirement security of millions of workers paying into their company pension scheme," said Joanne Segars, chief executive of NAPF.

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