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Autumn Budget 2017: The Highlights

On the 22nd of November, 2017 the UK Chancellor of the Exchequer, Philip Hammond, delivered the Autumn Budget 2017 to Parliament. The budget outlines how the country’s money will be spent in the foreseeable future. What changes are being made, and how might they affect you? Read on to find out.

 

Brexit

The Chancellor began by addressing the impenetrable elephant in the room – Brexit. He confirmed that almost £700 million has been invested in Brexit preparations already and that he is now setting aside a further £3 billion (and more, if needed) for further preparations. It is clear that the cost of Brexit is considerable, and is growing; with estimates forming that claim Britain will be short of £72 billion in lost economic activity by 2021.

Technology

Hammond spoke: ‘The world is on the brink of a technological revolution… But we must invest to secure that bright future for Britain.’ Highlighting Britain’s front-seated role in the developments of worldwide technology, Hammond demonstrated a commitment to support such innovations in the budget.

His resolves:

  • £500m investment in initiatives such as AI, 5G, and full fibre broadband
  • Regulators’ Pioneer Fund (to support regulatory innovation)
  • New Geospatial Data Commission
  • Support for driverless vehicles

We are yet to find out if Hammond will succeed in his wish to create an environment in which a new tech-company is formed every half-hour; an ambitious improvement on the supposed current figure of one-per-hour.

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Unemployment

Mr. Hammond acknowledged the dire fact that currently, 1.4 million people are unemployed in Britain today. No specific budgetary changes seemed to come from this; the Chancellor simply reaffirmed the forecast by the Office for Budget Responsibility that there will be another 600,000 people in work by 2022.

Investments

Hammond committed himself to the following investments:

  • ‘The biggest rail programme since Victorian times.’
  • ‘The largest road-building programme since the 70s.’
  • ‘The biggest increase in science and innovation funding in four decades.’
  • ‘And the two largest infrastructure projects in Europe – Crossrail and HS2.’

electric-car

The Environment

The Chancellor welcomed a commitment to the environmental cause, mainly through investment in electric vehicles and taxation on diesel vehicles.

Hammond promised:

  • £400m charging infrastructure fund
  • £100m investment in a Plug-In-Car-Grant
  • £40 million in charging research and development
  • The existing diesel supplement in Company Car Tax will increase by 1%

The other element Hammond introduced with regards to environmental issues, unrelated to electric vehicles, was an investigation into how the tax system and charges on single-use plastic items could potentially reduce waste (and thus emissions).

Education

The budget announcement reflected a support of the newly implemented of T-levels (technological qualifications), which are new qualifications firstly to be achieved in Digital, Construction, and Education and Childcare. Hammond announced that the budget will provide a further £20m support these new qualifications. He also claimed that the deliverance of 3 million apprenticeship starts will be achieved by 2020; demonstrating some focus on technological and alternative further education schemes.

Hammond also announced a curiously mathematics-focused agenda. His promises regarding maths and digital education are as follows:

  • £40m to train maths teachers across the country
  • £600 Maths Premium for schools, for every additional pupil who takes A-level or Core maths
  • Investment of £30m in the development of digital skills distance learning courses

universal-credit

Benefits

Mr. Hammond vocalized a commitment to the benefits reform scheme which came in the form of Universal Credit in 2016. He claimed that the implementation of Universal Credit is necessary to replace a ‘broken system that discouraged people from working more than 16 hours a week.’ Be you a supporter of Universal Credit or not, Hammond promised the following reforms to the deliverance of the benefit:

  • A change in the advances system to ensure that any household that needs it can access a full month’s payment within five days of applying.
  • Include the possibility to apply for an advance online.
  • Extension of the repayment period for advances from 6 months to 12 months.

For more on Universal Credit, click here.

Living Wage

The Chancellor announced that from April 2018, the National Living Wage will rise 4.4%, from £7.50 an hour to £7.83. This is a moderately positive development for working Britons.

Duties

The following changes in duties were announced:

  • Additional 1% duty on hand-rolling tobacco
  • Increase duty on low-quality alcohol (from 2019)
  • Frozen duties on other ciders, wines, spirits, and beers
  • Pint of beer will be 12p less
  • Bottle of whiskey will be £1.15 less (in 2018)
  • Freeze short-haul Air Passenger Duty rates (from April 2019)

national-health-service

The National Health Service

Changes in NHS spending are as follows:

  • Deliverance of additional £10 billion of capital investment
  • £350 million immediately to allow trusts to plan for this winter
  • Overall, the NHS will receive a £7.5 billion increase to its resource budget over this year and next year.

Taxation

Hammond took the time to flaunt the achievements of his government’s tax collection methods, claiming that it has ‘raked in an extra £160 billion over seven years for our public services by collecting the taxes that are due’. He will, he claims, continue in the same vein, aiming to raise £4.8 billion by 2022-23.

Hammond also promised to commit to finding a solution to the tax loopholes that arise from businesses that operate in cyber-space and international businesses.

housing-market

The Housing Market

Hammond, in the wake of the Grenfell disaster, announced that £28m will be provided to Kensington and Chelsea Council for mental health services, regeneration support, and to provide a ‘new community space’ for Grenfell United community group.

He then went on to comment on the problem of vacant homes and homelessness.

His resolves:

  • To give Local Authorities the power to charge a 100% council tax premium on empty properties
  • To invest £28 million in three new “Housing First” Pilots in the West Midlands, Manchester and Liverpool
  • To establish a homelessness task force, with an eye to eliminating rough sleeping by 2027
  • To commit a total of at least £44 billion of capital funding, loans and guarantees to support the housing market over the next five years
  • A £630 million small sites fund to unstick the delivery of 40,000 homes
  • £2.7 billion to more than double the Housing Infrastructure Fund
  • £400 million for estate regeneration
  • A £1.1 billion fund to unlock strategic sites, including new settlements and urban regeneration schemes
  • An additional £34m to develop construction skills across the country

The most marked change is the decision to abolish stamp duty altogether for all first-time buyer purchases up to £300,000.

Summary

The round-up of the Chancellor of the Exchequer’s Autumn Budget 2017 is as such. The most significant announcement is undoubtedly the abolition of stamp duty for first-time buyers on properties worth up to £300,000, such that some outlets are branding the move a ‘gimmick’. The Brexit outlook remains worryingly expensive, despite the country being said to be borrowing £8.4bn less than the borrowing forecast made in March. We will have to steadily bear witness to the changes as promised by the Autumn Budget as we move into the New Year.

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