THESE are difficult times, and more uncertainty lies ahead.
Supply chains had only just been recovering from the disruption wrought by the pandemic. Now energy markets especially are facing the almighty shock of the ongoing European war in Ukraine.
Many households and businesses are having to grapple with much increased energy and fuel costs.
But these pressures are being felt not just in the UK, but in many countries, all driven by similar factors.
The inflation we have seen here in the UK is broadly in line with that seen in the EU. But it has been even higher in the US.
It is against this challenging backdrop that the Chancellor of the Exchequer Rishi Sunak delivered his spring statement.
Of course, the single moment of the spring statement does not represent the totality of what the government is doing to help with the cost of living.
Even so, the chancellor did announce a number of important measures.
Despite an uptick in active travel, in predominantly rural areas like East Hampshire the car remains vital for so many. So I welcome the chancellor’s announcement that he is cutting fuel duty by 5p for 12 months. Together with the existing freeze, this is expected to save car drivers £100, and van drivers £200, this year.
VAT will be scrapped on energy-saving materials too – a move which was called for in last October’s COP26 East Hampshire.
We have also already seen the announcement of the Energy Bills Rebate scheme. Worth around £9 billion, it will support approximately 28 million households with their energy bills.
There will be an increase and extension of the Warm Homes Discount as well.
On top of this, the spring statement committed an additional £500 million for the Household Support Fund from April. This will help the most vulnerable households with the cost of essentials, including utilities.
We cannot will the turbulence in world energy markets to stop. The turbulence will continue, and over time we will need to adjust to this.
But these measures will provide some help to households in offsetting costs in the immediate term.
Around 30 million people will benefit from the National Insurance threshold rising from £9,500 to £12,570. Thanks to this, a typical employee will be saving more than £330 in the year from July.
In fact, about 70 per cent of all those who pay National Insurance contributions will have their taxes cut by more than what they will pay through the new Health and Social Care Levy.
The levy itself remains, for good reason, in place.
Another welcome announcement is the basic rate of income tax will be cut to 19p in 2024.
The last budget cut the Universal Credit taper rate from 63 per cent to 55 per cent. And the national living wage will also rise to £9.50 from April for those aged over 23. Both of these measures will support those on the lowest income.
Small businesses are central to the economy in East Hampshire. They drive local employment and underpin our close-knit town and village communities.
They, along with almost half a million small businesses, will benefit from the Employment Allowance rising to £5,000.
This represents a £1,000 tax cut.
Enormous global events are taking place.
And although government cannot fully insulate us from every single external shock, helping ease pressures from the cost of living and operating must be a top priority.
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