How Would Each Party’s Manifesto Affect My Finances?

How Would Each Party’s Manifesto Affect My Finances? 

We’re just a couple of weeks away from voting day here in the UK, and the various political parties have started outlining their plans in order to attract votes from those who agree with their policies. Although politics can be rather boring at times, the release of the manifestos is an interesting time as it helps you to decide where you’d like your vote to go, and it also gives you an idea of where you might be financially depending on who gets into government once the votes have been cast. In this guide, we summarise how each major political party could affect your household finances should they get into power this time around.

We’ve looked at the manifestos for the Conservatives, Labour, the Liberal Democrats, the UK Independence Party and the Green Party and we’ve highlighted any areas which could affect your personal finances, from the obvious things like tax on wages and caps on household benefits, to the less obvious like energy bills, childcare and university fees.

How Could The Manifestos Affect You?

Let’s start with the main two parties – The Conservatives and Labour. Even if neither of these parties get in on majority votes alone, it’s likely that one of them will be in number 10 after 7^th May in some form of coalition, as the Conservatives are with the Liberal Democrats at the moment. Please note that the following points are what the parties have released in order to win votes and they may not all be implemented if the individual party gets into power!

The Conservatives (Tories) – led by the Prime Minister, David Cameron

• Those earning minimum wage and working 30 hours per week will not have to pay income tax.
• They will make 30 hours of free childcare available to working parents of 3 & 4-year-olds.
• They will maintain a freeze in working-age benefits for the next 2-years.
• The household benefits cap of £26,000 will be reduced to £23,000.
• They’ll replace Job Seekers Allowance for 18-21-year-olds with a Youth Allowance limited to 6 months. They’ll also end automatic Housing Benefit for this age group.
• They’ll raise the personal allowance to £12,500.
• They won’t raise VAT or National Insurance contributions.

Labour – led by Ed Miliband

• They plan to raise the minimum wage to £8 per hour by 2019.
• They’ll provide access to childcare between 8am to 6pm for primary school-aged children.
• They’ll freeze energy bills until 2017.
• They’ll scrap the bedroom tax.
• They’ll cut university fees to £6,000 per year.
• They won’t raise VAT or National Insurance contributions.
• They plan to freeze rail fares through until next year, and further increases will be capped.
• They’ll introduce a ceiling on rent increases.

At the moment, we’re governed by both the Conservatives and the Liberal Democrats, although it’s looking unlikely that the Lib Dems will get back into power after this general election. However, anything is possible in British politics, so it’s useful to look at the smaller parties too, especially seeing as a coalition is looking likely once again. A coalition can be made up of two or more parties, depending on the amount of votes cast, so some of the following policies may get to see the light of day once the public has spoken.  

The Liberal Democrats – led by Nick Clegg

• They want to increase the personal allowance to £12,500.
• They’ll implement free childcare for all 2-year-olds.
• They’ll also offer 15 hours of free childcare for all working parents with children aged 9 months to 2 years.
• They plan to retain the £26,000 cap on household benefits.
• They’ll make it easy for those on zero hours contracts to request a fixed contract.
• They want to enforce 24 hour switching between energy companies.

UK Independence Party – led by Nigel Farage

• If you earn the minimum wage then you won’t have to pay tax up to earnings of £13,000 per year.
• They’ll raise the 40% tax threshold to £55,000 per year and introduce a new 30% tax rate for those who earn between £45,300 and £55,000 per year.
• They’ll scrap the inheritance tax.
• They plan to increase the transferable tax allowance for married couples to £1,500.
• They’ll remove VAT from listed building repairs and sanitary products.
• There’ll be no access to benefits or free NHS to migrants until they’ve paid tax and National Insurance for 5 years.
• They’ll lower the cap on household benefits, but they’ll also abolish the bedroom tax.
• They want to force energy companies to end higher charges for pre-payment meters. 

The Green Party – led by Natalie Bennett

• They plan to abolish the bedroom tax.
• They want to cap rents and regulate landlords.
• They’ll increase the National Minimum Wage to £10 per hour by 2020.
• They’ll reduce National Insurance contributions.
• They’ll provide free early education and childcare for children aged 0-7 years.
• They plan to scrap tuition fees and write off existing student loans, as well as reinstating Education Maintenance Allowance for 16 and 17-year-olds.
• They want to set up a nationwide home insulation programme which would take 2 million homes out of fuel poverty.

After the referendum for an independent Scotland, many of the Scottish voters (who were traditionally Labour supporters) have decided to support the Scottish National Party instead. Due to this, Labour have lost a lot of support north of the border and the SNP are expecting more votes than ever before. It is possible that the SNP could be part of a coalition after the general election on the 7^th May, so it’s worth looking at their policies even if you don’t live in Scotland as they could hold some power in 10 Downing Street in the near future.

The Scottish National Party – led by Nicola Sturgeon

• They plan to put an end to the bedroom tax.
• They want to continue zero tuition fees for Scottish students.
• They want to take control of the personal tax allowance for Scottish residents in order to ‘lift more low earners out of tax’.
• They’ll raise the minimum wage to £8.70 by 2020.

Remember – if you don’t like a certain party and their policies, not voting just strengthens the vote of someone who does vote for them. Get out there on 7^th May and vote if you can.