Budget 2011 - reactions to some of the key announcements for HR

"Forget the cuts, just fill up your petrol tank", is the Guardian's take on the Chancellor's instant 1p fuel duty cut, while the Telegraph's Benedict Brogan focuses on the steps taken by the Chancellor to woo business (with the exception of the banks and oil companies) with a range of tax cuts, as well as a "big, clanging hint" that he wants to scrap the 50p income tax rate for high earners as soon as possible.

The proposals most relevant to HR - covering pensions, taxation, job creation and employment regulation - received mixed reactions from employment groups.

Cutting "red tape"

The Plan for Growth (on the HM Treasury website) accompanying the Budget says that the government aims to ensure that the UK has "the lowest burdens from employment regulation in the EU".

The Chancellor's package of deregulatory measures was welcomed by employers' lobby groups, although deciding not to implement the dual discrimination provisions in the Equality Act and remove some existing employment rights seemed a long way from the apparent threat to remove maternity rights from women working for small firms floated a week or so earlier (on the FT website).

Confirmation of a moratorium on employment regulation for firms with fewer than 10 employees was welcomed by the CBI but not by the CIPD, who described it as "a dangerous precedent that risks creating a two-tier labour market" that could even act as a "perverse disincentive" to firms to take on an extra member of staff. Meanwhile the FSB thought it should be extended beyond micro-firms.

Single-tier state pension

Amongst the many Budget announcements affecting pensions (on the National Association of Pensions Funds website), the announcement of a plan for a single-tier state pension seem to be pretty universally welcomed, with the NAPF describing the announcement as "a turning point for pensions in the UK".

The proposal - which will be presented as an option in a green paper on state pension reform expected shortly - was also welcomed by the CIPD, who said that: "Good employers will welcome the clarity a universal, flat-rate pension will bring."

However others have pointed to the Budget's confirmation that this plan would end contracting out for defined benefit (DB) pension schemes, meaning that DB schemes will no longer be able to replace part of the state pension, as well as topping it up, leading to both employers' and employees' national insurance rebates being lost and remaining private sector DB schemes closing as a result.

"Having declined so rapidly, what is left of private sector benefit pension provision was never going to stand in the way of the Government's ambitions for the state pension," John Ball, head of UK Pensions at Towers Watson says. "Unfortunately, it is again employers who provided good pensions who will face disruption as the Government tries to fix the system for everyone else."

There will be plenty of small print for HR and reward specialists to pick over in the coming weeks particularly on the aspects of the Budget dealing with income tax and the possible impact of tax avoidance measures on employers' arrangements for employee benefits and share schemes (on the PWC website).

Trade union and other reactions

While the TUC's Brendan Barber had some words of welcome for additional funding for apprenticeships and the "much needed relief on fuel duty", he said yesterday that: "Most of today is about taking us back to the 1980s with deregulation gimmicks, hand-outs to big business and a deterioration of working conditions that failed to deliver jobs or growth then and won't today."

Meanwhile, the GMB took the opportunity to highlight the fact that low-paid council staff will not be getting the £250 flat-rate pay rise promised to other public sector workers as highlighted in the Chancellor's Budget speech (see my colleague Rachel Sharp's post on this on the Pay Intelligence blog).

Finally for the bigger picture, it is worth reading the Budget response from the Work Foundation, on the prospects for growth and employment, the EEF's take on things and the response from the Institute for Fiscal Studies, which recaps on the important changes to tax and benefits that we already knew were going to come into effect in April 2011.