New Conservative Government: what it means for your money
With the Conservatives gaining sole power, here's what they've pledged.
The Conservative Party has secured a surprise majority victory in the 2015 General Election, meaning that it will be in sole control of the UK for the first time since 1997.
The stock markets were cheered by the news, as was the pound, as the scale of the victory assuaged fears of political instability, in the short term at least.
But what’s the longer term outlook for our money?
Tax
The Tories promised there would be no increases in VAT, National Insurance or Income Tax if they were elected.
Indeed, the party has pledged to increase the tax-free threshold to £12,500 over the course of the coming Parliament and raise the higher rate (40%) threshold to £50,000.
The additional rate of Income Tax will remain at 45%.
Inheritance Tax is set to be reformed, as the Conservatives pledged in their manifesto to raise the threshold from £325,000 to £500,000, or £1 million, for a married couple, when a property is included in the value of the estate.
The much-hated ‘bedroom tax’ is likely to remain as with no coalition partners to appease a Conservative Government can leave it as is.
Taxes on alcohol, tobacco and fuel could all increase early in the Parliament to pay for some of the above changes.
Benefits
The annual benefits cap is almost certainly going to be reduced from £26,000 to £23,000 within a matter of days as this was a key manifesto pledge.
The Conservative Government is also going to deny housing allowance benefit to 18 to 21-year-olds on Jobseeker's Allowance, and replace it for this age group with a 'Youth Allowance' time limited to six months, after which all recipients should be in an apprenticeship, training or doing community work.
The single-rate State Pension is set to be introduced next year. Other pensioner benefits are likely to remain untouched.
Parents of three- and four-year-olds have been promised 30 hours of free childcare a week.
What isn’t clear is where the £12 billion of welfare savings are going to come from.
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Housing
The controversial Right to Buy scheme, a key plank of the Thatcher years, is to be revived and extended to tenants of housing associations.
The Conservatives also pledged to build 200,000 new homes by 2020 and offer 20% off market price for first-time buyers.
Pensions
Following the monumental reforms of the last government, the incoming Conservative administration is likely to press ahead with plans to cut the amount of tax relief someone earning over £150,000 can claim on their pension.
The pension lifetime saving allowance is also going to be cut from the present £1.25 million to £1 million.
And there was also a pledge to allow pensioners who’ve bought annuities to sell them and cash them in.
More immediately, they’ll need to find a new Pensions Minister following Lib Dem Steve Webb’s defeat in Thornbury and Yate.
Savings and ISAs
A couple of pledges from this year’s Budget are almost certain to be introduced. From next April, the first £1,000 of interest earned on savings will be tax free. New flexible ISAs are also set to be introduced in the autumn, which will allow withdrawals to be replaced without counting towards an ISA allowance.
Meanwhile, the new Help to Buy ISA is set to be introduced in the autumn, with every £200 saved for a deposit topped up by £50 by government.
Pensions expert Dr Ros Altmann is set to be appointed as Savings Minister to oversee financial education.
Stock markets and investments
While many experts say the short-term picture looks pretty stable, the spectre of a referendum on EU membership by 2017 and the uncertainty that brings could lead to rockier roads over the coming years.
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