Darling Alistair, you've got it wrong again

Mr Alistair Darling, UK Chancellor of the Exchequer is probably, even as I write, checking his notes and preparing to address the House of Commons and give his pre-budget speech.

As you would expect, the main dish on his menu of recession-busting issues was leaked to the press over the weekend.

I totted up what difference a 2.5% cut in the VAT (value added tax) rate would have on my personal ecomomy, but the best I could come up with was a penny off the price of a pack of my favourite chocolate biscuits. You have to do better than that Alistair - couldn't your boss Gordon give you any better tips?

It will make a marginal difference to a tank of diesel for 'Lily' my faithful VW Golf. That is nice, but I am not planning ro replace Lily, or make any other major purchase which I wouldn't have done otherwise and that would bring the Government more VAT in the end.

Had Mr Darling consulted me before decinding on his budgetary changes, this is what I would have advised.

1. Remove the 5% special VAT rate on energy bills.
   The UK has seen very high rises in energy costs this year, and the energy companies have not been very quick to reflect the drop in oil prices and reduce their tariffs again. This measure would really help every household in the country at a stroke and free up money to spend on other things.
   
2. Make the tax rise for the highest earners immediate and restore the 10% lowest income tax rate band. It is nitpicking to say that this Government have not yet broken their pledge not to change income tax rates. the 10% band WAS the standard rate for millions of low-paid workers.
   
3. What is the point of delaying this rate, other than to hand a future Government a poison chalice. British workers are already feeling wholly betrayed by the Labour party they used to regard as 'the workers' friend' with policies that helped them
   
4. Fix and reduce the tax take on every litre of petrol and diesel so that it is less sensitive to changes in the oil price. Every small business is hit hard when fuel prices rise, from farmers to plumbers and window cleaners. It has to be stabilized and quickly.
   
5. There were major complaints from the business community about the most recent changes to corporation tax. Reverting to the previous arrangements would boost business confidence considerably.
   
6. Stop mortgage lenders proceeding to home re-posssessions and force them to pass on bank rate changes. What the Government disregard is the fact that millions of UK homeowners are on mortgage interest rates tied to the LIBOR (inter bank lending rate) and NOT the standard bank rate. This is a racket and needs to be made illegal. It is pushing homeowners around the country into arrears when their loans should be getting cheaper to repay. Removing the threat of repossession will make people happier to go and do Christmas shopping and they will be more generous with presents for their families.
   
7. Cut the tax rate on beer wines and spirits. That little holiday present to the nation will make it a happier festive season for everyone, including the pub landlords who need a boost. Forget the issue of binge drinking. It's not the price of beer over the bar, but in the supermarket that causes this, plus the social attitudes to drinking. Parents should be much more thoughtful about the standards and examples they set their children about the use and abuse of alcohol. Stop the closure of hundreds of pubs across the country every month and you will do a great deal for the economy and society in all sorts of ways.

In general Mr Darling should be looking more closely at every little thing that will make life financially less stressful for Jane and Joe Public and the small and medium sized businesses that many of them run or work for.

Listen to what the CBI have to say today and anything subsequently said by organisations like the Federation of Small Businesses. The FSB made a submission to the Chancellor in anticipation of today's statement and it will be interesting to see if any of their suggestions are taken up. I have read this document and commend it to the Chancellor who appears to be deaf in that direction and to pleas from ordinary British citizens like yours truly.

I shall send him the link to my blog, but I don't expect to get a reply or a comment!