Grim times forecasted

The chancellor’s autumn statement and the latest economic forecasts may provide more reason for consumers to budget better.

The last couple of days may have provided plenty of reasons for consumers to improve their budget planning.

With the Organisation for Economic Co-operation and Development forecasting a new recession in the UK and the Office for Budget Responsibility (OBR) giving annual forecasts for low growth – 0.9 per cent this year and 0.7 per cent in 2012 – the situation looks bleak for consumers, not least as unemployment is expected to rise.

And it gets worse as the National Institute for Economic and Social Research (NIESR) has said the OBR forecast is consistent with its own projections – and that this will mean a short recession in 2012.

This will be bad news for those already on a budget, not least those who lose their jobs, although the NIESR did praise some of the measures taken to tackle the effects of the downturn by chancellor George Osborne in his autumn statement.

Among them are the improved Future Jobs Fund and the increase in free nursery places for two year-olds from disadvantaged families.

But helping with nursery places is not enough, according to Citizens Advice, which is unhappy over the apparent breaking of a budget pledge on child tax credits.

Chief executive of the charity Gillian Guy said: "The chancellor has broken the promise he made in last year's Budget to protect families on the lowest incomes from the impact of last year's harsh cuts by increasing child tax credits above inflation, leaving them now with no protection at all."

She warned: "Make no mistake, this means children in the poorest homes are at risk of going cold and hungry to pay for the new schemes the chancellor has announced today."

Whether this is a justified claim or not, hard times and tight budgets do call for good money management and consumers can make the most of their income with a budget planner.

This will enable people to check closely what they are spending and make adjustments where possible.

It could mean spending less on things that are not important, shopping at a cheaper store or simply cancelling direct debits that are paying for goods no longer received or expired memberships.

The next year may be very tough, but there are ways in which good budgeting can make it easier to get through.
 

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