Despite enormous global challenges the economy here in the United Kingdom is proving the doubters wrong. The Chancellor has had to make difficult decisions but the decisions he made as he stepped up to the role have allowed him to restore stability, avoid recession and to focus on growth once again.
His aim now is to at least halve inflation, reduce debt and created better paid jobs and opportunities across our country to pave the way for a better future for the next generation.
Here's some key insights to the Spring Budget 2023:
Cost of Living:
- Extending the Energy support by capping the Energy Price Guarantee to £2500 this Spring, giving families the certainty they need.
- Freezing fuel duty for the 13th consecutive year running
- Ending the premium paid by over four million households using prepayment meters ensuring fairness to all bill payers
- Extending the Help to Save Scheme for a further 18 months
- Expanding the Staying Close programme for care leavers
- The Mortgage Guarantee Scheme will be extended for a year
Boosting the Economy:
- Announcing a tax cut for businesses worth £25bn over three years. Delivering full expensing which offers 100% first year relief on new qualifying investments in main rate and plant machinery from 1 April2023 until 31 March 2025
- For every pound a company invests their taxes are cut by up to 25p putting £25bn back into the economy over the next three years
- We will still have the lowest Corporation Tax rate in the G7 incentivising investment and boosting growth.
- The UK will have the most generous capital allowance regime for businesses in the OECD
- Corporation tax is rising - for big business to 25% on profits above £250,000 per year
- Small businesses remain at 19%, a rate which is still lower than the past Labour Government (where it was 30%!)
- Increasing support for R&D with £500million
- Simplifying tax for SMEs allowing them to focus on business development. A review will take place on SME taxes to expand the 'cash basis' this will also cover sole traders
- New measures to be introduced to simplify import and exporting processes - something I know business across Tamworth are keen to see.
- Launching a competition through Great British Nuclear to build small modular reactors in this country and including nuclear energy in our green taxonomy.
- Providing up to £20bn funding for early deployment of carbon capture usage and storage, unlocking investment and job creation.
- Delivering a Brexit Pub Guarantee to freeze Draught Relief for pubs so that draught duty will always be less than supermarkets - support your local pub!
- The Government will accept all the recommendations from the Sir Patrick Vallance Review on pro-innovation regulation of technologies plus an investment of £900m in supercomputing.
- Launching 12 investment zones across the country which will have access to £80m over five years. Local authorities are encouraged to work together to put forward ideas on this - I know Staffordshire will!
- Tobacco levies will rise with RPI boosting the coffers for the NHS whilst deterring people from smoking.
- Some construction occupations added to the shortage occupation list
- Business visitor rules will be simplified
- Creative and Cultural reliefs to be extended to help the creative, museum and music sector
- Introducing 30 free hours of childcare per week for children from 9 months old to 4 years. We also aim to increase the availability and flexibility of childcare provision.
- Paying UC childcare costs up front instead of in arrears and increasing the childcare cost maximum for UC claimants.
- Increasing the hourly rates paid to providers of free childcare to meet rising costs
- Introducing reforms to the childcare sector on ratios
- Rolling out a national pathfinder scheme to encourage school-based wraparound provision for school children between 8am and 6pm.
- Adding a childminders grant to support childminders with start up costs and encouraging more people to enter the sector. It will be £600 for individuals or £1200 for those going through a childminder agency
- Introducing Returnerships for older 50+ adults to train for new job roles
- Investing £11m in funding to help Ukrainians and other forced migrant cohorts who have sought refuge here to enter employment.
- Continue work rolling out T-levels, Skills Bootcamps and Lifelong Loans for education.
- Piloting an expansion of the Supported Internships Programme for young people with special educational needs and disabilities.
- Increasing the pension allowance to £60,00 so more can pay into their pensions
- Abolishing the Lifetime Allowance for pensions from April 2023
- Increasing the Administrative Earnings Threshold from 15 to 18 hours to help more UC claimants into work roles
- Strengthening the UC sanctions scheme ensuring that those who can work, do work
- Launching a new UC programme for supporting the disabled and long term sick back into work, matching with existing job vacancies and providing tailored support
- Working to abolish the Work Capabilities Assessment to remove the distinction between those 'capable' and 'not capable' for work. This will make the system better for disabled people to find work.
- Investing an extra £5bn in defence and national security over the next two years to improve resilience and readiness
- Investing £3bn across the defence nuclear enterprise to boost our nuclear skills
- Replenishing our munitions stockpiles and investing in the resilience of our own defences.
- Providing an additional £33m over the next 3 years to support veterans in three projects - Infrastructure, A Mobility Fund and a Capital Housing Fund
- Increasing our NATO spending from the standard 2% to 2.5% of GDP when the fiscal situation allows.
Levelling Up the UK
- Launching 16 regeneration projects to restore pride in communities.
- Investing £200m in maintaining and improving local roads and potholes (hurray!)
- Funding an additional 30 projects through the Community Ownership Fund
- Running a Levelling Up Fund Round 3 (I'm confident Tamworth will apply)
- Delivering 20 Levelling Up Partnerships in left behind areas
- Providing £60m to a Swimming Pool Support Fund to help the leisure industry stay open and recognising the high costs of maintaining public pools due to energy prices.
- Increasing funding for suicide prevention
- Self assessment forms to include crypto assets
- Increasing funds to devolved administrations (NI/Scotland/Wales)
- Running trailblazer devolution deals with Greater Manchester and West Midlands Combined Authority to devolve new levers across transport, skills, housing, net zero and employment.
- The Government will seek to negotiation a further wave of devolution deals in England over this year.
All this work is in addition to protecting the triple lock, uprating benefits in line with inflation, increasing the national living wage and putting in place the winter support schemes. More than six million people on disability benefits will receive a further Cost of Living Payment this summer of £150.
Looking ahead the Chancellor still has aims to make tax cuts but will only do so when it is financially sustainable and responsible, this will be aimed at both residents and businesses. There will also be more spending on defence as soon as finances allow.
I'm pleased the Chancellor is focussing on jobs and job protection, and is focussing on getting inflation down and keeping it down.
Inflation is the biggest threat to people's earnings as it eats into their spending power, especially people on lower or fixed incomes. It's clear that we are not over the aftershocks of Covid19 but it looks like they are now getting less severe.
We must continue to be aware that international events can derail the international economy, as the war in Ukraine has done, so we must continue to be vigilant. With this in mind, it is good that we are increasing defence spending in an unstable world.
I will continue to share resident concerns with the Treasury as it is clear from today's Budget that his ears are open to views and ideas, to further boost our country post-pandemic.