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The Budget 2017

Wednesday, March 08, 2017

 

Chancellor Philip Hammond delivered his first budget to parliament promising an extra £2 billion for social care. The first spring budget under Theresa May's premiership also outlined an increase in National Insurance contributions by the self-employed and revised up its growth forecasts. The opposition described it as a "budget of utter complacency."

Headline Statistics

UK second-fastest growing economy in the G7 in 2016

Growth forecast for 2017 upgraded from 1.4% to 2%

GDP downgraded to 1.6%, 1.7%, 1.9% in subsequent years, then 2% in 2021-22

Inflation forecast to rise to 2.4% in 2017-18 before falling to 2.3% and 2.0% in subsequent years

A further 650,000 people expected to be in employment by 2021 

Public Spending & Borrowing

Annual borrowing £51.7bn in 2016-17, £16.4bn lower than forecast

Borrowing forecast to total £58.3bn in 2017-18, £40.6bn in 2018-19, £21.4bn in 2019-20 and £20.6bn in 2020-21

Public sector net borrowing forecast to fall from 3.8% of GDP last year to 2.6% this year, then 2.9%, 1.9%, 1% and 0.9% in subsequent years, reaching 0.7% in 2021-22. But borrowing still predicted to be £100bn higher by 2020 than forecast in March 2016

Debt rose to 86.6% this year, but will fall to 79.8% in 2021-22

Personal Taxation

The main rate of Class 4 National Insurance contributions to increase from current rate of 9% to 10% in April 2018 and 11% in April 2019

This will raise £145m a year by 2021-22 at an average cost of 60p a week to those affected

No changes to income tax, VAT or other National Insurance categories

Personal tax-free allowance to rise as planned to £11,500 this year and to £12,500 by 2020

Alcohol, Tobacco and Fuel

A new minimum excise duty on cigarettes based on a packet price of £7.35

No increases in alcohol or tobacco duties on top of those previously announced

Vehicle excise duty rates for hauliers and the HGV Road User Levy frozen for another year

Pensions, Savings and Business

Reduction in tax-free dividend allowance for shareholders and directors of small private firms from £5,000 to £2,000, from April 2018. 

£435m for firms affected by increases in business rates, including £300m hardship fund for worst hit

Pubs with rateable value of less than £100,000 to get a £1,000 discount on rates they pay

Increases for businesses losing existing relief will be capped at £50 a month

A tax avoidance clampdown totalling £820m to include action to stop businesses converting capital losses into trading losses, tackle abuse of foreign pension schemes and introduce UK VAT on roaming telecoms services outside the EU

Review of taxation of North Sea oil producers

Education 

£300m to support 1,000 new PhD places and fellowships in STEM (science, technology, engineering and maths) subjects

Free school transport extended to all children on free school meals who attend a selective school

Increased investment in schools of £216m

New T-Levels to be introduced to give parity of esteem for technical education

Number of hours of training for technical students aged 16 to 19 increased by more than 50%, including a high-quality, three-month work placement

Health & Social Care

£100m to place more GPs in accident and emergency departments for next winter

Additional £325m to allow the first NHS Sustainability and Transformation Plans to proceed

An extra £2bn for social care over next three years, with £1bn available in the next year 

Long-term funding options to be considered but so-called "death tax" on estates ruled out

Housing & Transport

Transport spending of £90m for the north of England and £23m for the Midlands to address pinch points on roads

£270m for new technologies such as robots and driverless vehicles

£16m for 5G mobile technology and £200m for local broadband networks

£250m in funding for Scottish Government, £200 for Welsh Government and £120m for Northern Ireland Executive

Women

New funding totaling £20m to support the campaign against violence against women and girls

A further £5m committed to project to celebrate the centenary of women first getting the vote, and to educate young people about its significance

Funding of £5m to support people returning to work after a career break

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