Delivering his first budget as chancellor, Phillip Hammond pulled few surprise moves. As expected the NHS, small business tax rates, and schools, were are the heart of a budget that showed where the governments priorities lie for the year ahead.
Schools and Education
- Creation of T-Levels for technically based qualifications. A £500m annual investment in this further education scheme to increase the number of hours training for 16-19 year olds by 50%.
- 110 new free schools get funding, building on the current commitment of 500.
- Class 4 NI contributions to increase by 1%, to 10%, in April 2018; then 11% in April 2019.
- A reduction from £5,000 to £2,000 in the tax-free dividend allowance.
- By stopping businesses converting capital losses into trading losses, reducing the abuse of foreign pension schemes and introduction of VAT on roaming telecoms, the Government hope to see £820m in return.
- The threshold for income tax changes to £12,500 for basic rate and £50,000 for higher rate at the end of the current Parliament.
- The Government recognises the changes that the digital age brings with it.
- Businesses coming out of the Small Business Rate Relief will get an additional cap.
- Pubs with a rateable value of under £100,000 will see a £1,000 discount on their business rates.
- A discretionary fund of £300m to deliver relief to hard cases will be made available to local authorities.
UK and Regions
- Scotland will see £350m, Wales £200m and Northern Ireland almost £120m.
- The North will receive £90m for transport, while the Midlands will be granted £23m.
Health and Social care
- Changes to the way Personal injury compensation claims are handled are due to have a heavy impact on the NHS budget. To cover this the Government have set aside £1.2bn.
- In an attempt to relieve waiting times in A&E £100m will be made available immediately for on-site GP triage.
- £2bn in grant funding for social care in England in the next 3 years with £1bn of that in 2017/18.
- Protecting consumers from unfair contracts in T&Cs and giving consumer bodies greater powers of enforcement.
- With the aim of encouraging ‘returnships’ the Government commits £5m to the public and private sector. They hope this will help people getting back into work after a career break.
- Government borrowing is expected to be around £24bn lower than previously predicted. The Office for Budget Responsibility (OBR) says public sector net borrowing for 2016/17 will be £16.4bn lower than forecast.
- While a year-on-year rise in borrowing has be pencilled in by the OBR for 2017/18 it is the first since 2012/13.
- OBR predicts growth in 2017 at 1.4% to 2%. Over the period to 2022, cumulative growth is forecast to be weaker than expected.