Infrastructure projects and pension changes among the expected announcements in first Budget of 2020
Sunday, 8th March 2020, 8:40 am
The Conservatives have signalled increased spending on infrastructure, while their manifesto promised extra public spending on areas such as the NHS as well as promising tax cuts.
The ups and downs of which, and the extent of borrowing that might be needed to fund those plans, will need to be laid out in this Government’s first Budget.
But when Mr Javid resigned in a cabinet reshuffle – after he refused to fire all of his advisers – it meant that a new Chancellor of the Exchequer, Rishi Sunak, will now take on the role of delivering the Budget.
Boris Johnson speaks during his first Cabinet meeting flanked by his new Chancellor of the Exchequer Rishi Sunak (Getty Images)
Here’s some of the priorities in his in-tray that we might see getting a mention in the announcement:
After the Government’s big HS2 and Northern Rail announcement, there will be many voters watching to see how much money the Government frees up instantly.
The Government has promised to invest £100 billion over the next five years, but it may put off a big installment until after the end of the Brexit transition period or the coronavirus crisis.
Mr Johnson has promised his Government would tackle the social care crisis.
He has pledged an extra £1billion of funding for councils to “ensure that the social care system provides everyone with the dignity and security they deserve” and a big part of his party’s promise was that no one would need to sell their home to pay for care.
Voters will now be watching closely to see how much of this is included in the first budget since the election.
There is also the suggestion that council tax could be increased which would, in turn, provide extra funding for local authorities.
And other public spending…
And there will also be pressure on the Government to deliver on some of the other promises it made during the election campaign regarding an easing up of austerity.
Mr Johnson promised voters a lot – building new hospitals, training new police officers and funding schools. He needs there to be a few choice cash giveaways in the Budget to avoid looking like he has done an immediate u-turn.
In the Tory manifesto there was a pledge to increase the threshold for National Insurance payments to £9,500 which would impact more than 31 million workers across the UK.
This came with a later commitment to raise it further but, for now, it would save all workers earning more than £12,600 around £100 a year.
The Conservative Party has pledged to reform the controversial entrepreneur’s relief and Mr Sunak is expected to be considering measures to cut back on the tax relief.
Also in the Queen’s speech, the Government said it would introduce a new policy to offer people a 30 per cent discount for key workers and first-time buyers purchasing properties in their local area.
The First Homes Scheme would reduce the cost of new homes for local people but, given that the consultation has just opened, there is not expected to be a concrete announcement in the Budget.
In light of the recent spread of coronavirus to the UK, the Chancellor is understood to be re-working his first Budget to protect the UK economy from the potential damage caused by the outbreak.
Mr Sunak said the Government would take “firm action to support families, businesses and public services”.
He is understood to be readying emergency cash which could be used to boost the NHS in a possible pandemic and also forming contingency plans to deal with the possible economic impact of having a large proportion of the workforce unwell.
He is also considering whether to change the rules around workers on flexible or zero-hours contracts who could be financially penalised for being off sick for extended periods of time.
Mr Sunak is also expected to end the freeze on fuel duty in a bid to get the country on track for its carbon emission goals.
It is understood he plans to scrap the £2.4billion diesel subsidy for users of farming and construction vehicles and is considering scrapping the freeze for all motorists as well.
The move would not be popular among many Tory MPs.
— to inews.co.uk