Don’t worry I am not going to bombard you with figures from the budget statement there are enough news channels to do that. I thought it maybe interesting to give a brief overview as to what it all means.

There is no doubt we are in a mess. The large lenders and investment banks got it completely wrong with unsustainable investments that have to be unravelled. Part of this unravelling means assets have to be sold at knock down prices and this has caused a meltdown in world stock markets and global economies.

So what does this budget hope to achieve? Its simple we are going to throw money at the problem, and lots of it. Government borrowing is forecast to increase to £118billion in 2009/10 (their figures). I like George Osbourne's analogy; the government will put the bill on its credit card and think about paying it off later.

Where will this money come from? From higher taxes. The reduction in VAT will end in December 2009, employer and employee national insurance will increase in 2011 and personal tax rates for higher earners will rise as from April 2010.

Let’s hope that it all works but most financial planners know that you don’t spend your way out of trouble, you have to face the problems and look at a longer term plan to increase sustainable income. Fingers crossed. If you would like to see where your money is spent click on the link.

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