Analysis and Opinion on June 2010 UK Budget Report Essay

Analysis and Opinion on June 2010 UK Budget Report - Essay Example Tariffs, taxes and rates indicated in the Budget also do have an impact on the trade policy and the volume and type of import and export transactions that take place in the light of budgetary restrictions or allowances. In the long run these will impact the UK’s balance of trade and balance of payments on current and capital account vis-a-vis its trading partners. Macroeconomic Objectives of the June 2010 Budget A review of the June 2010 Budget document as unveiled by the Chancellor of the Exchequer on 22 June 2010 indicates that two main macroeconomic objectives are to (a) rebalance the UK economy and (b) put it on the path toward sustained economic growth (Budget Document, p1). In order to achieve these twin goals, the Government has determined that action needs to be taken in three areas: (1) deficit reduction, (2) creation of business opportunities for private enterprise and (3) ensuring in fairness that all sectors contribute to deficit reduction. The Government has even created an Office of Budgetary Responsibility (OBR) and this institution has been entrusted with the task of reviewing the policy measures taken by the Government and their execution from time to time to ensure that these steps will reduce the deficit and contribute towards sustained economic growth in the future. The OBR in its review of the June 2010 Budget document has already opined that there is a more than 50 percent chance that these measures will achieve the Government’s planned macroeconomic objectives of reducing the deficit, meeting fiscal and debt policy objectives and thereby kick-starting the economy towards sustained economic growth. Macroeconomic Problems Highlighted in the... This essay is one of the best examples of the comprehensive analysis of the state of Budget fulfilment on a certain date in the United Kingdom. The Budget Report attached with the June 2010 Budget document very succinctly highlights the state of the UK economy. The new coalition Government led jointly by Nick Clegg and David Cameron promised to usher in a new era of prosperity and recovery, and at least be truthful to the public in order that its integrity never have to be questioned. The first step was to take stock of reality and let the public know how good or bad things were. Once this was established, new austerity measures were soon on the anvil to mend the state of the economy and bring the UK to a better path on the road to recovery. While everyone acknowledges that we are still not out of the woods yet, there has been some recovery in key sectors like banking, insurance and retail sales- which shows consumer confidence in the present Government and its ideals and vision for the future. The Budget is a key instrument for controlling the incomes and expenditures in the economy. The fiscal and monetary policy are other tools and instruments by which the Government and the Treasury hope to control the rate of interest, lending and borrowing and spending and saving. Care must be taken to keep the British Pound and the Euro at a good rate of exchange on the open market, while reducing signs of inflation or deflation at home. The Government is serious about promoting private business expansion through various actions.