Last week saw Philip Hammond’s first speech as Chancellor of the Exchequer, as he made the Autumn Statement to Parliament. It was not a speech to raise much in the way of optimism, as Hammond first acknowledged the challenges of ‘Brexit’, the issues the United Kingdom faces as it enters into negotiations with EU partners. The Office for Budget Responsibility (OBR) has forecast growth of 2.5 per cent less than before the vote to leave the European Union with Government finances now expected to be £122 billion worse off.
The main points to come out of the statement were;
- A forecasted need for higher borrowing and the expectation of slower growth,
- The UK deficit would no longer be cleared by 2020, and simply scheduled for ‘as soon as possible’ afterwards
- A commitment of billions of pounds of new spending on infrastructure – housing, transport and the digital economy, aiming to supply business with fibre optic cabled for 5G broadband.
- The OBR forecast £68.2 billion in 2016 of borrowing this year, and £59 billion in 2017 (rising from earlier forecasts of £55.5 billion and £38.8 billion respectively.)
Further changes announced include:
- Upfront fees imposed by letting agents in England will be banned.
- Fuel duty will be frozen for the seventh year running.
- The National Living Wage will rise to £7.50 an hour from £7.20 from April next year.
- A reduction in the rate at which benefits are withdrawn from people when they start work.
- There will be £1.4 billion made available to deliver 40,000 new affordable homes in England.
- The amount individuals can earn before tax will rise to £11,500 going up to £12,500 by 2020, after which it would rise with inflation. The higher tax band will rise to £50,000 by the end of this Parliament.
- The ‘productivity gap’ would be tackled with a new £23billion fund.
- A crackdown on compensation claims for whiplash injuries to reduce car insurance premiums
How do you feel the Autumn Statement will affect you and your business? Does the idea of 5G excite businesses in Somerset, where 4G is still a dream for many?