BREWERS, businessmen, pensioners and the low paid in East Lancashire gave a broad welcome to the Budget - but local homeowners and hauliers will be hard hit.

With East Lancashire having one of the worst rates of low pay in the country, the Chancellor's measures to cut income tax rates will be a boost to tens of thousands in the area.

But the abolition of tax relief on the first £30,000 of mortgages will hit the area harder than most as a high proportion of houses in East Lancashire are worth less than £30,000.

Owners will now have to pay interest at full whack, and the effect will be greater on their already low wage packets.

Businesses in East Lancashire - many battling against the strength of the pound which is hitting export markets - gave a muted response to the Budget.

Michael Toole, boss of M&J Textiles in Blackburn, said cuts in corporation tax were a start but said it was the increases in fuel duty which would have the biggest impact on business.

He said: "I can't see that the other changes will have any more than a minimal effect but the increase in fuel costs will have a major effect on firms right across the economy. "It is worth pointing out that this has come at a time when oil prices are at an all time low."

Michael Damms, chief executive of the East Lancashire Chamber of Commerce which represents more than 1,000 businesses, said the Budget did include a number of measures to help firms - provided the Government could meet its growth targets for the economy.

"The measures to encourage small business with a lower tax rate for start-ups and tax credits for research and development will be welcomed locally."

And he said measures to help the low paid would help more people in East Lancashire than in other parts of the country where wage levels are higher. But local manufacturers fear that the economic impact of the Budget means interest rate cuts are less likely.

Although beer duty has been frozen, brewers Daniel Thwaites said today they hoped the measure would be a "brief respite" and said it hadn't addressed the real problem.

"Beer duty has already gone up once this year and this decision doesn't address the issue of cross border shopping," said Paul Baker, managing director.

"As long as duty rates compared to other EU members remains high the threat to unemployment in the UK is very real."

And drinkers' pressure group CAMRA said although the freeze was preferable to an increase it was not good news for local tipplers and landlords.

"Pubs are closing directly as a result of high beer tax and without substantial duty cuts the situation can only get worse," said spokesman MIke Benner. The Chancellor's measures to increase fuel costs will have a major impact on haulage firms in the area.

Wayne Kenyon, managing director of Kenyon Road Haulage in Blackburn, said one local firm had already make 20 people redundant last week in anticipation of a harmful budget.

He said: "Profit margins are so low many firms won't be able to sustain the increase.

"We can't get any more money out of the customers because they are being squeezed too."

Pensioners were one of the main groups to benefit from the budget with measures including an increase in the winter fuel allowance.

"I think pensioners will welcome some of the measures provided they can be sustained," said Charles Warkman, a member of Mellor Senior Citizens Club and a Conservative councillor.

"But the fuel charges will have a major impact on senior citizens in rural areas like this who depend on their vehicles."

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