Budget October 2021

The Chancellor of the Exchequer, Rishi Sunak, has today announced the Budget and Spending Review to a packed Houses of Parliament. Here’s a summary of some of the key announcements.

Wages

In real terms, wages have grown by 3.4% since February 2020.

From 1 April next year, the National Living Wage will rise to £9.50 per hour up from £8.91.

This is a 6.6% increase in the minimum wage for all those aged 23 and over.

An additional £170 million will be invested in 2024-25 to increase the hourly rate for early years providers so that the government’s free childcare hours can be delivered.

The pay freeze for public sector workers, which was put in place last November as a result of the Covid -19 pandemic, will be lifted.

Hospitality and leisure

A temporary 50% business rates discount, up to a maximum of £110,000 was announced for retail, hospitality, and leisure sector businesses.

Alcohol duty has been simplified. There will now only be six rates rather than 15. In effect it now means that the stronger the drink, the higher the rate. Sparkling wine will pay the same rate as still wine of the same strength.

A 5% Draught Relief was announced which will see a cut to duty on draught beer and cider served from draught containers over 40 litres.

Business growth

There are plans for public investment in UK R&D to be increased by £20 billion by 2024-25. With further reforms planned for R&D tax reliefs to support modern research methods.

There will also be support for private R&D investment. Funding for core Innovate UK programmes will be increased to around £1 billion per year by 2024-25.

Housing

£24bn has been announced for ‘a multi-year housing settlement. This covers £11.5bn to build up to 180,000 affordable homes, with brownfield sites targeted for development.

A 4% levy to be placed on property developers seeing profits over £25m. This levy will help create a £5.1bn fund to remove unsafe cladding.

Here’s further information about the budget and spending review.

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