What to expect from Jeremy Hunt’s Spring Budget
Jeremy Hunt is set to unveil key pension and childcare benefit changes in his highly anticipated Budget on Wednesday.
The chancellor is reportedly considering raising the £40,000 cap on tax-free annual pension contributions, as well as increasing the state pension age to 68.
Efforts to encourage the over-50s, the long-term sick and disabled, and benefits claimants back into the workplace are likely to form a key plank of Mr Hunt’s plans.
The Budget is aimed at silencing his critics from within the Conservative party. Mr Hunt is under pressure from supporters of ousted prime minister Liz Truss, who backed her focus on growth to revive the economy.
The Budget comes in the wake of the autumn statement last November, which saw the chancellor hike taxes as he and Rishi Sunak sought to restore UK financial credibility after Liz Truss’ short-lived premiership.
This time, the chancellor is expected to focus on measures that will get various cohorts back to work as part of a wider push to boost growth.
It follows the release of new figures from the Office for National Statistics which show no change in Britain’s unemployment in the three months to January.
Editorial: The chancellor needs to end the abuse of apprenticeship levy funds
In an editorial, The Independent has said that Jeremy Hunt and his colleagues “need to end the abuse of apprenticeship levy funds, as revealed by The Independent’s investigation.
It states: “Though hardly at the top of the chancellor’s list of priorities, the sums involved in these scams are material – at least £1bn. This is taxpayers’ money has been used over the past five years to fund 55,000 already high-earning executives to take courses that are equivalent to a master’s degree but are badged, absurdly, as “apprenticeships”.
“Indeed, some £100m has gone on funding MBAs, many for executives earning more than £100,000 a year – despite a government attempt to stamp this out two years ago. The rise of “apprenticeships” for management candidates appears to have come at the cost of the young, with 100,000 fewer under-25s starting apprenticeships than before the levy was introduced six years ago.
“It is outrageous that scarce resources should have been diverted in this fashion: would that those involved had steered their ingenuity to growing their businesses and taking on real apprentices, rather than exploring loopholes in a scheme that was never meant to subsidise them. The skills and apprenticeships minister, Robert Halfon, has vowed to crack down on the MBA scandal, and it can’t come soon enough.”
Andy Gregory15 March 2023 05:04
Jeremy Hunt bids to head off critics with ‘Budget for growth’
Jeremy Hunt is to unveil a “Budget for growth” designed to provide for the health service, pupils and pensioners as he seeks to silence critics in his own party.
The chancellor will say his measures go beyond helping Britain emerge from its brush with recession.
Instead, he will promise “long-term, sustainable, healthy growth that pays for our NHS and schools, finds good jobs for young people, provides a safety net for older people – all whilst making our country one of the most prosperous in the world”.
Alisha Rahaman Sarkar15 March 2023 04:30
What will happen to taxes in the Budget?
Conservative MPs have been pushing for tax cuts – despite Jeremy Hunt so far appearing to be resistant to those calls, particularly on the issue of the planned corporation tax rise.
The business tax is due to go up from 19 to 25 per cent in April, under plans agreed during Boris Johnson’s premiership and Rishi Sunak’s tenure as chancellor.
All eyes will be on the chancellor to see if he offers any tax relief initiatives for businesses when he stands up in the Commons on Wednesday. He has already made a pre-speech announcement reflecting his desire to shock the economy into growth.
Officials said the scheme – backed by £80m of investment over five years in each of the new high-growth zones – is designed to accelerate research and development in the UK’s “most budding industries”.
Andy Gregory15 March 2023 04:02
What we know and what has been rumoured to be in the Budget
The chancellor will unveil his Budget today as the country battles a cost-of-living crisis and a stalling economy.
Jeremy Hunt’s fiscal package comes in the wake of the autumn statement last November, which saw the chancellor hike taxes as he and prime minister Rishi Sunak sought to restore UK financial credibility after Liz Truss’s short-lived premiership.
With the UK narrowly avoiding a recession since and the latest economic figures giving reason for optimism, the chancellor is expected to focus his Budget on growth measures as he seeks to reignite the economy and encourage people back to the workforce after the Covid-19 pandemic.
Here is what has been briefed already and what we can likely expect in Mr Hunt’s first Budget since being appointed by Ms Truss last year.
Alisha Rahaman Sarkar15 March 2023 03:40
Hunt to promise ‘sustainable, healthy growth’ in Budget
Jeremy Hunt will pledge to tackle labour shortages and get people back to work when he delivers his Budget.
The chancellor is also expected to reference the “difficult decisions” taken last November to stabilise the markets, following the short-lived premiership of Liz Truss, as he outlines a plan he hopes can deliver “sustainable” growth.
“Today, we deliver the next part of our plan: a Budget for growth,” he is expected to say. “Not just growth from emerging out of a downturn.
“But long term, sustainable, healthy growth that pays for our NHS and schools, finds good jobs for young people, provides a safety net for older people … all whilst making our country one of the most prosperous in the world.”
Mr Hunt will promise a growth plan that will remove “the obstacles that stop businesses investing” while also “tackling the labour shortages that stop them recruiting” and “breaking down the barriers that stop people working”.
Andy Gregory15 March 2023 03:03
Jeremy Hunt mulling raising cap on tax-free annual pensions contributions
Jeremy Hunt is known to be considering raising the £40,000 cap on tax-free annual pensions contributions – and could reportedly hike it to £60,000.
Mr Hunt’s team has also looked at a possible increase in the lifetime allowance (LTA) on pension savings, another tweak Mr Hunt’s team has looked at. The tax-free lifetime amount could rise from £1.07m to as much as £1.8m, according to reports.
Meanwhile, other reports suggest that the UK state pension age could rise to 68 sooner than expected.
Andy Gregory15 March 2023 02:05
What cost of living measures are expected in the Budget?
Jeremy Hunt is expected to cancel the planned £500 hike in the government’s ceiling for energy bill support which was due to come into force next month.
For the average household that means bills will stay at around £2,500, instead of going up to £3,000 as was previously announced.
On fuel duty, some Tory backbenchers have urged the chancellor to act to support motorists facing a 12p-per-litre hike in fuel duty in March. A 23 per cent increase in the duty is pencilled in for this month, but chancellors have repeatedly frozen the levy in the past. Mr Hunt has so far not said what he will do.
Action is expected on prepayment meters with the Chancellor set to end the so-called “prepayment premium” from July – which the Treasury expects will save more than four million households £45 a year on their energy bills.
Struggling public swimming pools will also be handed assistance to cope with their rising energy bills, with a £63m one-off pot to be created. Most of the money will be earmarked for leisure centres to invest in moving towards renewable energy forms.
Patrick Daly15 March 2023 01:03
Hunt told he is running economy like ‘Jeremy from accounts’
Speaking to Sky’s Sophy Ridge on Sunday show, the chancellor was told that he was running the economy “like Jeremy from accounts”.
He replied that “Jeremy the chancellor will be responsible with public finances, I make absolutely no apology for that”, adding: “What you will also see on Wednesday is that we have a plan to tackle the biggest problems we face as a country.”
Sophy Ridge tells Jeremy Hunt he is running economy like ‘Jeremy from accounts’
Andy Gregory14 March 2023 23:59
Hunt vows to ‘go further to bear down on inflation’
Jeremy Hunt earlier vowed to ”go further to bear down on inflation” in Wednesday’s Budget.
“The jobs market remains strong, but inflation remains too high,” the chancellor said this morning. “To help people’s wages go further, we need to stick to our plan to halve inflation this year.
“Tomorrow at the Budget, I will set out how we will go further to bear down on inflation, reduce debt and grow the economy, including by helping more people back into work.”
Andy Gregory14 March 2023 23:00
Job vacancies fall for eighth month in a row amid economic ‘uncertainty’, as Hunt prepares ‘back-to-work’ Budget
Vacancies across the UK have fallen for the eighth month in a row as firms hold back on hiring amid woes in the wider economy, official figures have shown as Jeremy Hunt prepares to unveil his “back-to-work” Budget.
The Office for National Statistics revealed a 51,000 drop in the number of job vacancies to 1.12 million in the three months to February, while the redundancy rate edged higher, which it said “reflects uncertainty across industries, as survey respondents continue to cite economic pressures as a factor in holding back on recruitment”.
Britain’s unemployment rate remained unchanged at 3.7 per cent in the three months to January, but the drop in vacancies signalled cracks in the jobs market as economic uncertainty weighs on companies.
The figures also showed there were 220,000 days lost to strike action in January, down from 822,000 in December, with schools the hardest hit.
Andy Gregory14 March 2023 22:01