What I listened out for (and what I heard) in The King's Speech

An early start to check the latest CPI data from the Office for National Statistics (2% in the 12 months to June, phew!) was followed by another exciting finance fixture...

King Charles kicked off the new parliamentary session today, in an event called the State Opening of Parliament , announcing the bills that will debated over the coming days in the House of Commons and the House of Lords.

As expected, we heard a series of pro-growth bills to help the UK economy shake off its hangover and start working out. Central to this are plans to drive private investment into UK infrastructure and green technology.

The King spoke about the desire to rebuild trust and deliver the “best outcomes possible” for citizens across the UK. It’s hoped that the change in government will see the UK become “a modern dynamic economy” and “a leading industrial nation”, at the forefront of AI and green tech.?

HRH described economic growth as “a fundamental mission”, promising that the government will help households and communities look forward to better living standards. But, for families struggling with day-to-day costs, “moving on” from the cost-of-living crisis doesn’t feel realistic. The new bills may point Britain’s finances in the right direction, but the journey to economic recovery could be a long one.

For our personal finances

• It’s hoped that the government’s commitment to green energy will see household bills reduce “over time”.
• Following recent sewage scandals, the water regulator Ofwat will be given more powers to ensure water companies deliver improvements to water quality. (In the short term, funding those improvements means our bills are going up.)
• Reform of the planning system to “get Britain building”, should make it easier to solve the shortage of housing stock which has pushed UK House Prices up so high over the long term. Driving private investment into UK infrastructure?is an essential part of this plan.
• An end to no-fault evictions – this was promised by the Conservatives but didn't come to life. Labour intends to help vulnerable private renters by reforming grounds for possession. The laws around leaseholds will also be reconsidered.
• The government is committed to “making work pay”, but we’ll have to wait for details of exactly how they will help people back to work. Nothing was given away in the speech about the benefits safety net for people whose income (or lack of) doesn't meet their basic needs.
• VAT exemption removed from private school fees and the money used to help recruit teachers for state schools. As a former secondary school teacher I'm happy to debate this.
• Investment in pensions will be "strengthened".

For small businesses

Small businesses were listening out for bills that would signal stability and consistency so that they can press on with growth plans. Other than the planning reforms (which won't be relevant to many small businesses) there wasn't much to go in the speech.

On the plus side, we found out from the Office for National Statistics this morning that inflation has stabilised at 2% and services inflation held steady at 5.7% , suggesting companies may face less pressure to keep upping wages.?

• Exploitative practices will be banned and workers given enhanced employment rights. Giving workers more flexibility is an issue close to my heart as a working mum, but this issue is tricky. Small and early-stage businesses may not be in a position to make long term hires - they need to be agile and respond to market changes. The flexibility needs to work for both businesses and workers. People who are self-employed , doing casual or freelance work, still need to be able to plan their personal finances around their income. Many people want to be able to work digitally, flexibly and remotely from home , so workers' rights need to be updated to reflect this.
• The apprenticeship levy will be reformed, helping businesses to recruit and train the people the need.
• Trade relationships with the EU will be "improved"...

What else?

• Nationalisation of the railway network so that it becomes publicly owned. I studied nationalisation vs privatisation as part of my Public Policy Economics course with 英国牛津大学 so I'm looking forward to nerding out on this one. I also have a couple of close friends who work, or have worked, for Network Rail in my nearest city, Milton Keynes. It's going to be fascinating how this plays out for our finances, whether you travel by train or not.
• More powers for the Office for Budget Responsibility to ensure there is always independent oversight of the country's financial plans BEFORE the government makes any surprise announcements about tax and spending.
• More powers devolved to local regions to make financial decisions specific to the needs of their community. Mayors and combined authorities will have new powers to support local growth plans and will collaborate with each other.?
• The Mental Health Act will be modernised so that it is fit for the 21st century.

Correct me if I'm wrong, but...

• I was expecting to hear about tougher sanctions for shoplifters, and I didn't. Local small businesses all over the UK struggle with this issue, with a shocking 5.6million incidents of shop theft reported over the last year. I was shocked reading the 2024 Crime Report yesterday. However, local policing to tackle antisocial behaviour was highlighted as a priority.

Warning: a pinch of salt might be required. It's possible we'll hear about bills that never actually turn into laws. The government may also pass bills later this year which don't get a mention in the speech.

Post updated 1pm on Wednesday 17th July 2024.