In the end it was more of a "Budget" than a "pre-Budget" report - coming in at 54 minutes long and announcing major changes to UK tax, spending and benefits.

But what did the papers make of it all? MSN Money takes a look:

The Sun

The Sun devoted half the front page to Gordon Ramsay’s alleged affair and half to the pre-Budget report. “Up to arrears: Darling spree means ONE TRILLION debt,” screamed the headline. Inside, the pre-Budget report occupied five pages shared between the main paper and "Captain Crunch, the pull-out special". Overall the paper looked favourably on the pre-Budget report – specifically on the VAT tax cut and the 45% tax for high earners.

In its “Strings attached” feature, the paper explained how the nation would pay for the VAT holiday. “But the cut is only TEMPORARY. Booze, cigs and fuel will shoot up in cost in January 2010 when VAT goes back to 17.5%”.

The Sun’s business editor, meanwhile, explained that in the current economic crisis, Darling had no room to manoeuvre. “Prudence and stability went out of the window as Alistair Darling became the man of big, bold and decisive action,” Steve Hawkes said.

The Times

The cartoon on the front page of The Times sums up their take on the pre-Budget. It shows Brown and Darling dressed as traditional Labour supporters of the 1970s in their flat caps, boots and working clothes. Brown is using Darling as a flagpole and the flag is reminiscent of the hammer and sickle with a pound sign replacing the sickle. Could they be hinting that Labour have signalled a return to their red ways?

The focus is certainly on the effects on the “better-paid” in their analysis of Darling’s “Robin Hood-style Budget statement of breathtaking scope". The Times points out that 800,000 who earn more than £100,000 are being asked to “bear the brunt of deferred tax rises". To say The Times is not universally positive about the measures announced is an understatement. Pages four and five carry the headlines “Shot in the arm for economy may prove a shot in the dark” and “(Only) one thing is clear: it is worse than we thought".

The Daily Mail

The Daily Mail’s opinion on the PBR is unclear – it simultaneously commends the chancellor for extending a “helping hand to the poorest families” and attacks the policy for increasing tax on the UK’s high earners. It calls yesterday’s PBR a “crisis budget” and says New Labour has died. The National Insurance increase and new tax rate will “punish” both middle and high earners.  The Daily Mail has calculated that the NI increase will cost a family earning £40k an extra £550 a year in 2011.  There is some interesting analysis of the chancellor’s economic growth predictions and borrowing forecasts, with some scary looking graphs illustrating the government’s borrowing in 2009. Finally, the main editorial says that Brown and Darling have ignited a “fiscal nuclear weapon under Briton” and that we face many torrid months waiting to discover if they’ve saved the nation or bankrupted our children as well as ourselves.

The Daily Mirror

It’s really interesting that so many papers are saying the PBR announcements have come from Gordon Brown, yet it was clearly Alistair Darling who addressed Commons yesterday. He is the chancellor after all. The Daily Mirror says the PBR was a gamble for Gordon Brown: he’s staked his political career on a £20 billion gamble to save the UK from a crippling recession. Inside (after page 3’s “news” about Jude Law running into his ex-wife Sadie Frost at a function yesterday), the Mirror claims the PBR is a rescue package for “shoppers, OAPs and families” – pretty much everyone, then. The VAT cut – “A VAT lot of good” – means little as people don’t have any money to spend anyway. There’s a useful at-a-glance column showing the main changes and a brief mention of the difficulties that shops face in implementing the lower VAT rate.

The Daily Express

The Daily Express is almost as miserable as The Times. They reach similar conclusions, but in very different ways. There’s that phrase again: Robin Hood Budget. While The Times focuses on the better-paid, the Express carries the headline “Middle Britain Bashed”. Darling is responsible for “the biggest tax raid in living memory” as he clobbers the country with “swingeing” tax rises, bring Britain to the “brink of bankruptcy”. (They do like their alliteration at The Express.) Ah well, readers can always distract themselves by reading of how the Queen’s Russian teapot was “bugged” (see page seven).

The Daily Telegraph

The Telegraph, like the Express and unlike The Times, focuses on the middle class and how they face a “tax time bomb”. The time bomb is also stealthy however: the paper notes how “Labour again turns to favoured stealth tax”. The Telegraph devotes half a page each to the effects on motorists and long-haul holidaymakers, both of whom will be paying more. It waits till pages six and seven to spread some cheer, noting how struggling homeowners, families and the elderly will benefit, given the extra protection for those facing repossession, the rises in child benefit and the £60 “gift” for pensioners.

Its special report labels Darling the chancellor "with the worst economic forecasting record in history and the worst borrowing record since the Second World War". It does note that there is help for small businesses in the pre-Budget and also that it has been given a "Cautious approval from employers’ groups and unions".

The Guardian

The Guardian went big on the “£21bn tax gamble” and spread 15 pages of coverage between its front pages and a “What it means for you” special: “Alistair Darling yesterday gambled the government’s political future on a ‘spend now, pay later’ £21 billion package of tax cuts and spending increases designed to lift the economy out of recession by next summer.”

“Back to the 70s: high-stakes bet that redraws political battlefield” reads the headline on pages two and three: “Labour and the Tories have set out their stalls. Time – and the electorate – will tell who got it right and who got it wrong.”

The paper also ran a truth check on Darling’s key statements from yesterday. Perhaps most interesting was its audit of one of George Osborne’s rebuttals. “’It means a £20bn temporary giveaway, but £40bn in permanent higher taxes.’ This looks correct for 2009...what the tax takeaway really equates to is about £9bn of tax increases each year forever more.”

Another feature praised Vince Cable  for the way he predicted the credit crunch. “In November 2003 when interest rates stood at a 48-year low at 3.5% and no one was talking about the end of the longest boom in the UK’s history, Cable was on his feet in the Commons warning of the hangover.”

The paper’s special led with “After the gain comes the pain” – discussing the changes to taxes and noting that it’s “just like the 70s – without the 3-day week”.

The Independent

“Brown goes for broke” began the paper’s 22-page coverage of the pre-Budget report. First focusing on the possible effect of the speech on New Labour, the Independent claimed that the report was a thrown gauntlet for the next election. “The battle lines for the next general election were dramatically redrawn yesterday,” the paper said on the front page. The main angle was “Darling helps the poor – and the party”.

Page three was reserved for the paper’s first critical articles. “A monumental debt that takes us back to the 70s” and “Tax rise is a repudiation of New Labour” raised doubts that the chancellor’s plans were going to work at all. “Having got us into a jam by borrowing too much, the way out is to borrow yet more. This is a gamble of monumental scale, a bet on the world economy growing again by the second half of next year. This is a gamble of monumental scale, a bet on the world economy growing again by the second half of next year. If it does recover, then the chancellor may have succeeded in puffing up our own economy a bit during the downturn but the borrowing levels to achieve that are terrifying. If the world economy does not recover, the consequences don’t bear thinking about,” said Hamish McRae.

The Metro

“I owe, I owe, it’s off to work I go” began the Metro’s seven-page pre-Budget report coverage.

The paper explained who the rise in National Insurance “will wipe out tax cut gains”. The tax hike will “virtually wipe out the rebate millions of basic-rate taxpayers will gain from Mr. Darling’s announcement that personal allowances will be cut permanently for the abolition of the 10p tax rate,” the paper said.

The Financial Times

There are nine pages of coverage in the FT, plus most of the front page.  The lead story contains all the facts and figures from Darling’s pre-Budget report and a column dedicated to the main points.

There’s also a clanging teaser for a p10 comment piece on the front page: “If a 45% top rate of tax today, why not 50% tomorrow”. If that doesn’t get the City boys reading I’m not sure what will.  Chris Giles answers five key questions on the pre-Budget report including: how bad will the recession get, is the plan credible and how will the Treasury restore prudence. Darling’s changes to business and corporate tax should stem the tide of companies leaving the UK, the FT says.  VAT changes will be a “nightmare” for retailers and savings will be eclipsed by pre- and post-Christmas sales.

There’s a good summary of comment from business chiefs and economists. The FT has dug deep into the report and reveals that a string of public sector businesses, including the Royal Mint and the Met Office, could be sold. A review is currently underway into alternative business models for the businesses which have a government stake. Finally, George Parker had these optimistic words for the nation’s politicians:  “Alistair Darling … gave the impression that the next general election is one that no party in its right mind would want to win.”

The words the chancellor used in the pre-Budget report

Posted by Katherine

The Bank of England has stunned borrowers and lenders alike with an unprecedented cut to the base rate – from 4.5% to 3% - however there is no guarantee that banks will pass the cut onto borrowers.

In-depth analysis on the interest rate cut - and what it means for you

Pressure mounted on the Bank’s Monetary Policy Committee to act aggressively, with markets factoring in a 75 basis point cut. Today’s unprecedented rate cut returns interest rates to levels unseen since 1951.

The FTSE's response to the rate cut         

Do you think the rate cut will be enough to restore stability? Did you see any benefit since last month’s rate cuts? Have your say on the message board.

Official figures showed UK output shrunk by 0.5% between July and September - the first quarter of negative growth since 1992. An economy officially enters recession after two quarters of negative growth.

In addition, UK manufacturers have experienced the worst decline for nearly 28 years.

Because of the grim financial data, anything less than a 1% cut would be "too little, too late" to combat the economy's steep decline, forecasters at the Ernst & Young ITEM Club warned.
         

What it means for you
For people with variable rate, discount rates or tracker mortgages, a 1.5 cut in interest rates will save you £125.14 - more than £1,500 a year - on a £150,000 repayment mortgage with a 25-year term; £150.17 a month on a £180,000 mortgage and £208.57 a month on a £250,000 mortgage on the same terms.

Whether the banks pass on the rate cut, however, is a real concern.

As our columnist Nick Louth pointed out already, a rate cut is unlikely to make any difference to your bank balance, no matter what the rate shrinks to, mostly because the banks aren’t about to put consumer concerns ahead of profits.

After October’s decision, 30 banks failed to adjust their variable rates to reflect the cheaper cost of borrowing. Another 34 had not passed on the full cut. The only banks to pass on the full cut last time were Lloyds TSB, Halifax, the Woolwich and Royal Bank of Scotland.

In fact, Abbey even increased the cost of its variable rate mortgage this week in advance of today’s announcement.

Banks are claiming they can't afford to lower rates for customers, however this doesn't stack up. Libor - the rate banks use to lend to each other - has fallen by more than October's 0.5 point reduction. Before the BoE's surprise cut in October, Libor stood at 6.2% - it is now 5.7% some 0.5 points lower.

What's more, banks are starting to act to make sure that can still make money from people on tracker mortgages. Lenders, including Abbey, Nationwide and Halifax, increased the cost of tracker mortgages shortly before the Bank of England announcement, so the rate cut will have less impact, while others are changing their terms and conditions.

It’s also worth considering that if banks pass on savings, it’s likely to be savings from last month’s rate cut, not today’s.

Have you seen any benefit from last month's rate cut? Do you think November's rate cut will be enough to save the UK from recession? Have your say on the message board.

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