Autumn Budget 2024 – It’s a good start, but nowhere near enough
Chancellor Rachel Reeves has delivered her first Budget Statement, and whilst it looks like a good start, there is much more that needs to be done.
She is hoping that extra funds gleaned from a hike in Employer National Insurance Contributions (NICs), combined with increases in wealth taxes, and the introduction of a new investment rule that has enabled the Government to effectively redefine public debt, are sufficient to boost the economy and keep local authorities from the abyss.
After years of underfunding of local authorities and social care services, however, there is not much cause for celebration. Whilst more funding is being made available, the need is so much greater, and the rise in Employer NICs will affect all employers, regardless of sector. Even at a time when the unemployment rate is relatively low, this tax on jobs is likely to restrict hiring and limit growth across the economy. Following the recent airing of the Employment Rights Bill, employers could be forgiven for thinking that the Government’s claims to be ‘pro-business’ are sounding a bit hollow.
On a positive note, the £500 million confirmed by the Chancellor for the affordable homes programme (AHP), supporting the delivery of 5,000 new affordable homes, is good news. However, this is just a drop in the ocean when you consider the Government’s target of building 1.5 million new homes over the course of this parliament. Importantly, the funding confirmed for the AHP is alongside a 5-year social housing rent settlement of CPI+1% and reductions in Right to Buy discounts. These proposals will benefit Local Authority Registered Providers and housing associations alike.
The biggest risk the Chancellor has taken in the Autumn Budget is the decision to introduce new fiscal rules. By redefining public debt as ‘net financial debt’, she has effectively released significant borrowing capacity into the economy. How the City and investors will view this move, is not yet clear.
With a £22 billion ‘black hole’ in the country’s finances, some may have been expecting more tax increases. While private individuals and employers are taking the biggest hit from this round of fiscal changes, they may well be feeling relieved that the tax hikes weren’t more onerous.
So, whilst this is a good start, the problems we are facing in local government, health, social care and the housing crisis mean there is so much more to do. If the financial markets are not spooked by this Halloween budget, then maybe the Government will feel more confident next time to use more of the borrowing capacity created.
Peter Hubbard
Managing partner
Autumn Budget 2024 – Our insights
More funding for affordable housing, but radical changes are needed to make a real difference
The Chancellor’s decision to top-up the affordable housing programme (AHP) with funding to the value of £500 million, is welcome.
Autumn Budget 2024: We were warned that tax hikes were inevitable
As expected, Chancellor Rachel Reeves has announced a number of tax increases and other fiscal changes, some of which will affect private individuals.
Autumn Budget 2024: Little good news for the health and social care sector
There is a general feeling that the challenges facing H&SC providers were almost completely overlooked
Now let the change begin
The new Labour Government must press ahead with its plans for change and make the most of the first 100 days in office. There is an opportunity to change things for the better for some of the most vulnerable people in society. This is an opportunity that must not be missed.
To deliver on Labour’s manifesto pledges, Keir Starmer’s Government must demonstrate that it is ready to take radical action to tackle the big issues of the day. It must be bold and break the cycle of decline that is affecting many industry sectors by restoring economic stability so businesses and organisations can plan for the long term and invest in the future.
Here is what has been accomplished in the first 100 days:
The 100 days are up
Close of the first 100 days: an affordable housing perspective
Housing played a key part in Labour’s election campaign which was reflected in a very long to-do list.
Close of the first 100 days: a local government perspective
There have been a series of announcements during the first 100 days of Labour’s Government which will impact local authorities during the course of this Parliament.
Close of the first 100 days: a health and social care perspective
The flagship policy for the social care sector in Labour’s election manifesto was the introduction of ‘Fair Pay’ Agreements for the sector workforce.
Close of the first 100 days: a social business perspective
It has been a mixed bag for Labour’s first 100 days in office, and the forthcoming Budget may give a clearer road map.
Close of the first 100 days: a private client perspective
The Labour Government’s first 100 days in office have not brought much to cheer about from a private client perspective.
Our post-election insights
The Government’s ‘must-do’s’ for the first 100 days to support the social housing sector
The new government provides an opportunity for a reset in social housing. Here are our recommended ‘must-dos’ for the first 100 days.
Helping drive change in local government: the Government’s 100 days of ‘must-do’s’
Our local government specialists provide some suggested ‘must-dos’ for the Government’s first 100 days to start change on a sound footing.
The Government needs to drive clarity for health and social care in its first 100 days
Our HSC specialists outline their recommended ‘must-dos’ for the next 100 days focusing on it being a time for clarity.
Shining a spotlight on social purpose businesses: ‘must-do’s’ for the first 100 days
With a new government comes the opportunity to put social purpose business needs higher up the agenda with 100 days of ‘must-dos’ focusing on some urgent needs for reform.
The Government’s ‘must-do’s’ for the first 100 days to support the charities sector
The ‘must-dos’ for the first 100 days need to focus on getting the basics in place to ensure that the charities sector does not continue to be overlooked.
A commitment to change: 100 days of ‘must-do’s’ for private legal services
Our specialists recommend that the ‘must-dos’ for the first 100 days should be focused on addressing some key areas to support individuals.
Nowhere to hide: making the most of this reset opportunity
This is an opportunity to deliver a plan for the long-term
Keep up to date with the changes
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Read what our experts had to say in anticipation of the election.
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