Autumn Budget Highlights
Rishi Sunak, The Chancellor of the Exchequer, has outlined the latest spending plans in his Autumn Budget. He said the government is aiming for a stronger economy for the British people stating growth up, jobs up and debt down which is supported by £150billion additional funding being made available across all government departments for increased spending.
There was welcome news for some businesses with business rates cut for retail, hospitality and leisure as well as the planned inflation rate increase cancelled. Other measures are:
Economy Update
- 3.1% inflation, likely to rise further. This is due to an increased demand for goods and issues with supply, and the surge in global demand for energy. Oil, coal and gas prices have doubled. It will take months to ease but it is a shared global problem.
- The government is ready and willing to act against global fuel uncertainty and will be responsible with public finances.
- Economic recovery is expected to be quicker than previously forecast – OBR (Office for Budget Responsibility) expects pre-covid level of economy at the turn of the year. It predicts that gross domestic product (GDP) to expand by 6.5% this year compared to the 4% it forecast at the Budget in March.
- Wages are rising by almost 3.5%
- 0.7% will go to international aid (up from current 0.5%). At the projected rate of recovery, Britain can help the world’s poorest too.
Business Update
- Business rate evaluations will take place every 3 years starting 2023. The Chancellor explained it would be irresponsible of the government to get rid of business rates totally as they generate significant revenue. The planned inflation linked increase in the Business Rate multiplier has also been cancelled. Also from 2023 businesses can make property improvements and pay no interest rates.
- Tax relief for theatres, museums, galleries, will be doubled until April 2023.
- There will be a new 50% business rate discount for retail, hospitality and leisure businesses, for one year, capped at £110,000. This is the biggest tax cut in over 30 years – cut by £7 billion.
- Draught duty relief on beer and cider from draught containers over 40 litres cut by 5%. Permanent cut from February 2023.
- Planned increase of duty on spirits, beer and wine cancelled from tonight.
- To encourage businesses to adopt green solutions like solar panels, £750million will go towards incentives for businesses to go green.
Fuel prices
- Fuel duty rise will be cancelled. The average tank will cost £15 less for cars, £130 less for HGVs.
- Air passenger duty (APD) will be cut by half for travel between England, Scotland, Wales and Northern Ireland.
- APD for long haul flights to increase to offset carbon emissions from international flights.
Investing in education and work skills
- 3.8billion to go to skills including T Levels to increase, adding more places for skills bootcamps, more funding for apprenticeships.
- New numeracy programme for improving basic maths skills
Transport
- £21 billion to go to roads
- £46 billion to railways across the country
Health and NHS
- £5.6billion to the NHS and health services to help fund new hospitals, better screening technology, 50,000 more nurses and more training.
Homes
- £1.8billion for new homes
- £5billion to reduce unsafe cladding on modern high-rise buildings, with 4% levy for housebuilding developers to go towards the cost.
Policing
- 20,000 new police officers
- Extra £2.2bn for courts and rehabilitation services.
- £3.8billion to prison building
Schools
- £4.7 billion going to schools, with 30,000 special needs new school places
Communities
- £560m for youth services
- £200m for 800 football pitches
- New pocket parks
- £1.7billion in over 100 local areas
- Museums and libraries to be refurbished
Public sector pay rises
- National living wage increasing by 6.6% to £9.50 an hour. Brings us closer to a high wage, high skill economy of the future.
Taxes
- Taxes rising but will aim to reduce taxes by the end of this government and will reward work.
Universal credit
- Chancellor confirms that he will cut the universal credit taper rate from 63% to 55%, not later than 01/12/21. This will help families to keep more of their pay on universal credit, on average £1,000 a year.