The government budget announcements can seem tedious and dull to follow through the usual breaking news channels and it may not always be made clear as to how these things will affect you. Here we have done the hard work for you to give you a comprehensive guide of what you need to know about the recent spring budget.
The spring budget for the government is given by the Chancellor of the Exchequer, currently The Rt Hon Philip Hammond MP, to the House of Commons outlining the state of the economy and the government’s proposals for changes to taxation.
However, this has been the last spring budget as the 2016 Autumn Statement announced, following the 2017 Spring Budget, Budgets will be delivered in the Autumn rather than in March or April of each year.
Philip Hammond said: “The Office for Budget Responsibility (OBR) now forecasts that the UK economy will grow by 2% in 2017. The OBR also forecast that the economy will grow at a slightly slower rate in 2018, before picking up to 2% in 2021.”
A bit of a hint to a projected drop because of Brexit perhaps?
There will be a £5 million fund for celebrations to take place next year when it will be 100 years since the Representation of the People Act 1918 which was the first legislative step towards equal voting rights right for men and women.
Sophie Walker, leader of the Women’s Equality Party said:
‘Hammond’s offer of 5 million pounds to celebrate the centenary of women’s suffrage adds insult to injury as women in every corner of our country pay the price of successive governments’ failure to acknowledge their economic contribution. Celebrating women’s historic emancipation is important, but perhaps the Chancellor could invest in our future freedoms?’
A plan to fight against domestic violence and abuse with funding of £20 million was also announced. Which brings the total for the government’s strategy to end violence against women and girls to £100 million by the end of Parliament in 2020.
The strategy says they aim for “a reduction in the prevalence of all forms of violence against women and girls, matched by increases in reporting, police referrals, prosecution and convictions for what can still be hidden crimes.”
The funding shall also go towards educating young people about its significance.
A promise of £5 million to increase the number of returns to work by helping people back into employment after a career break, for instance, women who have taken time out of work to have a family.
A £425 million investment in the NHS over the next three years was announced. Along with £325 million will be invested in a first set of the best local Sustainability and Transformation Plans (STPs).
STPs are the NHS’s plans for improving patient services in local regions, developed collaboratively by NHS service leaders and their local partners.
£100 million will go to A&E departments in 2017-18, to help them manage demand ahead of next winter, and help patients get care faster.
For example, it will provide more on-site GP facilities and more space in A&E units for assessment of patients when they arrive.
The UK government are aiming to be world leaders in 5G technology. They have announced £16 million for a national 5G Innovation Network to trial new 5G technology.
5G simply stands for fifth generation and refers to the next and newest mobile wireless broadband technology.
5G is set to be available in 2020 but there are rumours it could be up to three times faster than the current 4G we are using on our phones.
It was also announced that they will provide £200 million for local projects to build fast and reliable full-fibre broadband networks.
Alcohol and Tobacco
Duty on tobacco products will increase by two per cent above inflation from 6pm on March 8, a rise of 35p a pack.
However, rollie smokers will be paying out more with the price of a 30 gram pack of rolling tobacco went up by 44p.
But it is not just tobacco that is going up. Your favourite tipple is going up too.
The Chancellor’s move means the price of a pint of beer is up by two pence and a pint of cider is up by one pence while your favorite bottle of still wine is up by eight pence, a bottle of sparkling wine by 10p.
Spirits are affected too with a litre bottle of vodka up by 40p and a litre bottle of gin by 43p, according to the Wine and Spirit Trade Association.
The Wine and Spirit Trade Association said today was the first time in 25 years a Chancellor has increased all alcoholic products by inflation.
Protection of consumers
Ever mistakenly paid for a whole year of Amazon Prime because you forgot to cancel the free trial?
This may no longer be a problem as the government is going to investigate ways to protect consumers from unnecessary costs.
They are going to look at preventing consumers being charged unexpectedly when a subscription is renewed or a free trial ends while also looking at making terms & conditions simpler and clearer including in digital contracts, like when you sign up to a social network.
They shall also be looking into fining companies that mislead or mistreat consumers
There will now be a three-year National Savings & Investments (NS&I) investment bond with a market-leading interest rate of 2.2 per cent
The bond will be available for 12 months from April 2017.
The government announced the NS&I Investment Bond at Autumn Statement 2016. It will be open to everyone aged 16 and over with the flexibility to save between £100 and £3,000 over three years.
So if you do happen to be a millennial with any spare change this may be where you want to put it.
There will also be a lifetime ISA will be available from 6 April this year.
The Lifetime ISA will allow younger adults to save up to £4,000 each year and receive a bonus of up to £1,000 a year on these contributions. Funds can be withdrawn tax-free to put towards a first home or saved until a person turns 60.
So yay! We may actually be able to buy a house or live comfortably in old age!
National living wage
Rises to £7.50 an hour in April. The government has pledged that the national living wage will be at £9 an hour by 2020.
The Chancellor has promised to give a helping hand to companies hit by planned business rate rises, but has also increased the national insurance (NI) bill for many self-employed people.
The Chancellor said he wanted to do something about the gap between NI contributions between those who are self-employed and currently paying less in tax.
People who are currently in full-time employment pay 12 per cent income tax and NI straight from their monthly pay, but self-employed workers pay slightly less. That said, they also do not get sick pay, maternity pay or holiday pay.
So, from next year Hammond is raising the rate of NI for self-employed people from nine per cent to 10 per cent and then 11 per cent the year after that.
There is currently rising “gig economy”, a labour market characterised by the prevalence of short-term contracts or freelance work as opposed to permanent jobs.
For instance, Uber drivers used to be classed as self-employed until they won a legal case to be classed as workers.
Deliveroo drivers are currently fighting the same battle.
So it could be argued that this announcement is just a way of the government taxing this new breed of workers to the max.