The Budget is the Goverment’s primary fiscal event of the year. Covering pretty much every area of taxation and spending, the Chancellor sets out where money will be taken and spent over the coming year. It’s practically Christmas for policy wonks like me. But with so much packed into one red booklet, there is always a risk that the overriding theme is lost or misunderstood.
Fortunately, my colleagues in the Treasury made our aims loud and clear last week. This Budget saves households money, spurs private investment and helps people back into work.
For households, we have acted quickly to extend the current Energy Price Guarantee rate beyond April to July. The Government will continue to shield billpayers from high retail prices until lowering wholesale costs translate into cheaper bills from July. A long-standing premium on pre-payment customers has also been removed from bills through the Guarantee.
I was delighted that calls by local residents to freeze fuel and beer duty were answered. Pubgoers are also set to enjoy pints taxed up to 11p less than supermarket booze thanks to the incoming “draught beer duty”. Having recently ran a competition to decide the best pub in the Bishop Auckland constituency, it is clear punters have a wealth of brilliant locals to choose from.
When it comes to business support, new national and local incentives will promote reinvestment over profit-hoarding. For example, if you’re a firm investing in qualifying plant and machine over the next three years, you’ll get the full cost written off. That’s the result of a new full capital expensing policy announced last week, which makes our capital allowances the most generous in the OECD.
Here in the North East, we stand to benefit from a new Investment Zone, subject to tax relief and grant funding worth £80 million over 5 years. It means new jobs and supply chains springing up all around us. Alongside our region’s Freeport status- and the £1.4 billion investment budget available to the inaugural North East Mayor- County Durham residents are well placed to take advantage of new opportunities in the coming decades.
Finally, this budget will relieve existing burdens on the economically inactive so they can earn a living. Where people want to and can work, we will do more to facilitate it.
Childcare has long been too expensive in this country, restricting parents’ ability to work. Parenthood should not be a barrier to employment, which is why the Chancellor unveiled huge reforms for the sector. In the coming years, working parents of children aged 9 months and over will be eligible for 30 hours free childcare per week. By expanding the free childcare offer to younger children, parents will both save money and gain the time to earn more.
Accompanying the expansion of free childcare are the launch of “returnerships” skills courses for over-50s, up to £4,000 funding for disabled people on Universal Credit to access work and new financial incentives for carers and childminders.
Over the past year, our country has weathered unprecedented economic conditions globally. The impact on growth and inflation has been tangible on our day-to-day lives. However, Ministers have refused to let these circumstances trigger our country’s decline.
This Budget is another important step on the journey to a stronger economy. If we maintain the path we are on, businesses will grow, inflation will slow, and we’ll keep unemployment low.