The Spring Budget eliminates impediments to employment, frees up corporate investment, and directly addresses labour shortages with the goal of ensuring longterm, sustainable economic growth that will bring prosperity to the people of the United Kingdom.
According to Chancellor of the Exchequer Jeremy Hunt, “Our plan is working – inflation falling, debt down and a growing economy. Britain is on a lasting path to growth with a revolution in childcare support, the biggest ever employment package and the best investment incentives in Europe.”
Here are the major takeaways from the budget:
Substantial childcare reforms would help nearly half a million English parents with children under 3 who are unable to find work due to caregiving obligations, thus reducing discrimination against women and boosting the general economy in the process.
- By September 2025, every child over the age of nine months with working parents should receive 30 hours of free childcare, with eligibility matching the current 30-hour provision for children between the ages of three and four.
- This will be implemented in stages, with 15 hours of free childcare for working parents of children aged 2–3 years coming into effect in April 2024 and for working parents of children aged 3-9 months coming into force in September 2024.
- In addition, starting in September, the cash given to nurseries for the currently available free hours offered will increase by ￡204 million, reaching ￡288 million the following year.
- To overcome the obstacles to working caused by the lack of wraparound care, schools and local governments will receive funding to improve the supply of care so that parents of school-age children can drop off their children between 8am and 6pm.
- The maximum claim has been increased to ￡951 for one child and ￡1,630 for two children—an increase of about 50%—and will now be paid upfront rather than in arrears for childcare costs of parents who start working or increase their hours while receiving Universal Credit.
- In order to increase the number of childminders available and give parents more options and affordable childcare options, incentive payments of ￡600 will be tested starting in the fall of this year for those who decide to enter the field. These payments will increase to ￡1,200 for those who join through an agency.
The chancellor presented a thorough plan to assist people in finding employment, working more hours, and extending their working lives, especially for those receiving benefits.
- Before being completely abolished, the lifetime allowance charge will be eliminated. By doing so, the tax code will be made simpler by removing thousands of pounds from the complexity of pension tax.
- Increasing the Annual Allowance from ￡40,000 to ￡60,000 will encourage highly trained professionals to stay in the workforce. An estimated 80% of NHS doctors would not be subject to a tax penalty with regard to accruals under the 2015 NHS Career Average Scheme as a result of the pensions tax reforms announced today.
- A brand-new "Returnerships" apprenticeship programme geared for older employees will improve current skills programmes to make them more approachable to older workers and provide them with the knowledge and assistance they need to find a clear path back into the workforce.
- To ensure that people receive the best possible financial, health, and career assistance well in advance of retirement, the midlife MOT offer will be expanded and improved. For Universal Credit claimants who are 50 and older, there will be an improved digital midlife MOT tool and an extension of the DWP's in-person midlife MOTs, with a goal of reaching 40,000 each year.
- To ensure that it better fulfils the needs of disabled individuals in Great Britain, a DWP White Paper on disability benefits reform will mark the beginning of the welfare system's most significant overhaul in the last ten years. This includes getting rid of the Work Capability Assessment, which means most claimants will only need to undergo one health examination as opposed to two. Also, reforms will encourage claimants to work without worrying about losing their financial support.
- In England and Wales, funding will be provided for the creation of a new voluntary work programme called Universal Assistance for persons with disabilities and medical problems. If fully implemented, the government would assist 50,000 persons annually by spending up to ￡4,000 on each individual to find them a suitable role and take care of their needs.
- A ￡406 million plan to address the primary health issues keeping individuals out of the workforce, with funding earmarked for treatments for cardiovascular disease, musculoskeletal disorders, and mental health.
- Strengthening the standards for lead carers of children ages 1–12 who are claiming Universal Credit in the United Kingdom.
- Increasing the Administrative Earnings Threshold (AET) for an individual claimant from the equivalent of 15 to 18 hours at the National Living Wage and eliminating the couples AET in Great Britain. The AET determines how much support and Work Coach time a claimant will receive based on their earnings. About 100,000 people who are unemployed or earning low wages will be urged to meet with their work coach more frequently in order to receive assistance in finding employment or raising their income.
- By giving Work Coaches additional training to apply sanctions effectively, including for claimants who do not look for or accept employment, and by automating administrative steps of the sanctions process to lower error rates and free up Work Coach time, the application and enforcement of the Universal Credit sanctions regime will be strengthened.
- The UK's six-month business visit visa offer will now cover more short-term commercial operations, and five construction occupations will be added to the list of Shortage Occupations. This will help attract international talent from other countries.
The chancellor proposed a strategy to encourage business investment, foster innovation, and control energy costs.
- A "full expensing" policy that will be in effect from 1 April 2023 through 31 March 2026, along with an extension of the 50% first-year allowance during that time, will result in a change in capital allowances that will save firms ￡27 billion over the course of three years.
- 20,000 R&D-intensive enterprises will receive a ￡500 million per year package of assistance due to reforms to the R&D tax credit.
- Substantial tax measures for the creative industries will shield theatres, orchestras, museums, and galleries from continued economic constraints and encourage the UK to produce even more performances of the highest calibre.
- To make the most of the Brexit freedoms and hasten patient access to therapies, the Medicines and Healthcare Products Regulatory Agency (MHRA) will get ￡10 million in additional funds over two years. As a result, starting in 2024, the MHRA will be able to implement new, quick approvals systems, facilitating faster access to medical procedures already recognised as effective by reputable international partners as well as cutting-edge technologies such as cancer vaccines and AI therapeutics for mental health.
- The Spring Budget was released today, along with Sir Patrick Vallance's review into pro-innovation regulation of digital technologies. All of the recommendations are to be adopted.
- A commitment to a ￡2.5 billion ten-year quantum research and innovation programme under the government's new Quantum Strategy, as well as ￡900 million in financing for an exascale computer and an AI Research Resource, making the UK one of just a few countries to have one.
Local communities will be given the authority to direct their own economic futures to promote equal growth throughout the Country and generate opportunity everywhere.
- Increased accountability for local leaders in expanding their communities' economies.
- From the renovation of Ashington Town Centre to a skills and education complex in Blackburn, more than ￡200 million will be used for high-quality neighbourhood revitalization initiatives in regions that require these.
- Twenty of England's districts most in need of leveling-up, including Rochdale and Mansfield, will receive more than ￡400 million in new Levelling Up Partnership funding.
- In the following Parliament, business rates retention was extended to other regions.
- Delivering ground-breaking devolution agreements to the Greater Manchester and West Midlands Combined Authorities, which include one-time multi-year settlements for the upcoming Spending Review and a promise to negotiate other devolution agreements in England.
- In the UK, there are 12 investment zones, including 4 in Scotland, Wales, and Northern Ireland.
- ?A second round of the City Region Sustainable Transport Settlements will get ￡8.8 billion in investment over the subsequent five years.
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