Will the Budget see more people looking for finance jobs in London?

With the election now seeming like an age ago, the recently formed coalition government has set about outlining its plan to pay off the UK's deficit, with the chancellor of the exchequer unveiling his first Budget this week.

One of the biggest points of interest was that people working in the public sector are set to be subject to a two-year pay freeze, which could see some of these professionals looking for private finance jobs in London instead.

And George Osborne's Budget has further implications for the UK's workforce, with an investigation set to be carried out by John Hutton into public sector pensions, while the increase of the state pension age to 65 will be accelerated.

Meanwhile, from April of next year, the threshold for employees to pay National Insurance (NI) will rise by £21 per week, while new businesses located outside of London and the south-east will be exempt from up to £5,000 of employer NI payments for the first ten workers they hire.

The government is keen to invigorate the private sector and encourage recruitment, announcing a five-year plan to reform corporation tax regime to help with this recovery.

All of these announcements are set against a planned VAT rise from next January, taking the duty to 20 per cent.

Overall, the Budget has been welcomed for what it is attempting to do to ease any pressure on those actively seeking work, although one commentator has claimed it may not be such good news for public sector employees.

Martin Bamford, chartered financial planner and managing director at Informed Choice, said: "For investors and business owners, the measures announced were mainly better than expected."

He added that many of the measures introduced with the aim of helping businesses, including the decision to limit employer NI increases and reduce corporation tax, will make the UK private sector "more attractive and hopefully boost the economy".

Meanwhile, the Recruitment and Employment Confederation (REC) has suggested that the chancellor's decision to reduce tax liabilities on private sector businesses will help the country's jobs market.

Kevin Green, chief executive of the REC, said: "We are delighted that the government has put tackling business taxation at the heart of this budget.  It is clear that the private sector will need to grow jobs as the public sector sheds them and this Budget sets the framework for this to happen."

He went on to offer some advice to the public sector, claiming that it needs to become more efficient, in addition to learning how to attract the talent that it needs.

In the long term, he recommended that the sector become as successful as the private business model by making itself more flexible and adaptable to future changes.

In the mean time, people looking for finance jobs within the private sector may be breathing a sigh of relief, while the Budget may now have given those employed by public bodies something to contemplate over the coming weeks and months.

 

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