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Budget 2021: What were the key announcements?
27 October 2021, 10:40 | Updated: 27 October 2021, 16:18
The Chancellor has revealed his Autumn 2021 Budget to MPs, warning of "challenging months ahead," post Covid-19.
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Speaking in the House of Commons this afternoon, Rishi Sunak unveiled the new plans, including a £150bn departmental spending spree.
Addressing the house he said: "Employment is up. Investment is growing. Public services are improving. The public finances are stabilising. And wages are rising.
"Today's Budget delivers a stronger economy for the British people: stronger growth, with the UK recovering faster than our major competitors.
"Stronger public finances, with our debt under control. Stronger employment, with fewer people out of work and more people in work. Growth up, jobs up, and debt down.
"Let there be no doubt - our plan is working."
Here are the key points the chancellor has announced this afternoon:
- Departmental spending will go up by £150billion over this parliament
- Per-pupil spending in schools will be back at 2010 levels by 2024-25
- Research and development spending will rise to £20billion a year
- Major reforms to business rates to help post-covid comeback
- Universal credit ‘taper rate’ slashed from 63p in the pound to just 55p
- Minimum wage will rise to £9.50 next year
The other measures in the Budget are:
Infrastructure and investment and transport links
- Increased investment to support transport systems, similar to London, across England's city regions
- A £21bn investment for roads and a further £46bn to improve railways in the hopes of shortening journey times
- The government will hit their target for research and development spending two years later than planned
- Libraries will be “renovated, restored and revived”
- Tax relief on museums and galleries was due to be announced in March next year; it will be extended until March 2024
- An increase in fuel duty will be cancelled, saving motorists £8bn over five years
- A levy will be placed on property developers with profits over £25 million at a rate of 4% to help create a £5 billion fund to remove unsafe cladding.
- An extra £2.2bn for courts, prisons and probation services, including £500,000 to reduce the courts backlogs
- A £3.8bn investment for the "biggest prison-building programme in a generation"
- A £5.9bn package will support the aim to deliver around 30 per cent more elective activity by 2024-25 compared to pre-pandemic levels - equivalent to millions more checks, scans and procedures for non-emergency patients
- Some £2.3 billion of the funding will be used to try to transform diagnostic services, with at least 100 "one-stop-shop" community diagnostic centres being opened across England
- A £1.7 billion investment in the "infrastructure of everyday life in over 100 local areas"
- Mr Sunak said the Government is backing projects in Aberdeen, Bury, Burnley, Lewes, Clwyd South and Stoke-on-Trent - along with Labour areas of Ashton under Lyne, Doncaster, South Leicester, Sunderland and West Leeds
- Through the Barnett formula Scottish government funding will go up by £4.6bn, Welsh government funding by £2.5bn, and £1.6bn for the Northern Ireland Executive
Alcohol and pubs
- The UK’s main duty rates on alcohol will be cut from 15 to six
- Lower strength alcohol will have a lower tax rate including fruit ciders, liqueurs and rose
- Higher strength alcohol will have a higher tax rate including strong red wines and high-strength cider
- "Draft relief" will be introduced in hospitality venues slashing the price of tap beer and cider
- Small beer, ale and cider brewers will receive relief
- The "irrational duty premium" of sparkling wines costing more than still wines of equivalent strength will end
- An 8 per cent cut to the Universal Credit taper rate from 63 per cent to 55 per cent and the changes will take effect "within weeks"
- A single mother of two, renting, and working full-time on the National Living Wage "will be better off by around £1,200"
- A couple, renting a home with their two children, one working full-time, the other working part-time, "will be better off by £1,800 a year"
- The work allowance will be increased by £500
- The living wage will increase to £9.50 an hour, which will produce a raise of £1,000 a year
- Public sector pay freeze on wages will be lifted
- The Office for Budget Responsibility forecast inflation will average 4 per cent next year
- Funding for each pupil will be returned to 2010 levels
- Funding will increase £1,500 per pupilA total of 30,000 special school places will be created
- £5bn support in catch-up funding because of the Covid pandemic
- A planned rise in fuel duty has been scrapped