Yesterday saw the much anticipated and crucial Autumn Statement.
Like many countries around the world, the UK is facing profound economic challenges – Putin’s illegal invasion of Ukraine and the Covid pandemic having significantly hit public finances. We spent £409 billion in direct support during Covid and now our essential Energy Support scheme is costing roughly the same as the NHS – all this must be paid for, at a time when the global economic levels have deteriorated.
The Autumn Statement required some tough, though fair decisions to help start reduce Government borrowing (essential to keep mortgage rates down and protect pension pots) whilst where possible providing further help to those most in need as well as essential public services and business who we need to grow.
Therefore, it was a tough balancing act, with every penny counting. The priority is to restore economic stability, tackle inflation (as inflation makes everyone poorer) and provide additional support for those most in need.
Key measures announced include: • Keeping the Pensions Triple Lock • Uprating Benefits in line with inflation • National Living Wage increased to £10.42 an hour, worth £1,600 per year to 2m low paid workers • Extending the Energy Support Scheme for households and businesses a further year • £7.7bn increase in funding for the health and social care over the next 2 years • £4bn increase in funding for schools over the next 2 years • £12bn additional targeted support to the most vulnerable households on means tested benefits, pensioners, disability benefits and extending the Household Support Fund • £14bn business rates package to protect businesses, particularly retail, hospitality and leisure sectors.
Whilst there are no increases in the headline rates of tax, to help balance the books the Autumn Statement does raise an additional £25bn in a range of tax changes for larger businesses, wealthier households and the oil and gas industry (Windfall Tax).
These are undoubtably challenging times, but there is light at the end of the tunnel. The OBR expects these changes will reduce inflation (now believed to have peaked) and employment to remain high, with GDP expected to be 1% higher. The Bank of England expects these changes to keep interest rates lower for borrowers and mortgage holders.
These are challenging times, but we are best placed to navigate through, delivering strong, sustainable growth and then ultimately a return to our tax cutting principles, sharing the proceeds of growth with all.
Finally, I was privileged this week to attend the Remembrance Sunday service at the Cenotaph and lay a wreath on behalf of North Swindon residents. I have seen first-hand the number of people coming to pay their respects growing each year, remembering all of the armed forces personnel from Swindon who served and those who made the ultimate sacrifice for our freedom and way of life.