- By Anthony Reuben
- Check the BBC
image source, UK Parliament/Andy Bailey
Chancellor Jeremy Hunt will release his budget on March 6, nearly a year after his first spring budget.
In Budget 2023, he announced measures including growth, inflation and childcare. Government press release.
How has the government progressed in providing them?
Development budget
Introduced by Mr Hunt His speech “Budget for Development” on 15 March 2023.
But, according to official statistics, the economy has not grown since then.
For the rest of 2023, zero growth is followed by 0.1% and a contraction of 0.3% – meaning the UK economy has entered recession.
Halving inflation
Mr Hunt highlighted the Office for Budget Responsibility's (OBR) forecast that inflation would be halved by the end of 2023.
When he presented his budget, inflation was still over 10%, and it actually halved, reaching 4% by the end of the year.
Help for pubs
From 1 August 2023, the chancellor announced plans to make draft relief more generous, describing pubs as a “treasured social enterprise”.
It fits Alcoholic beverages such as beer and cider below 8.5% ABV can be served on draft.
The relief reduced the tax on them by 9.2%. Mr Hunt said: “We protect the price of a pint”.
But the price of beer continues to rise.
The Office for National Statistics (ONS) reported that prices rose by 7.5% in January 2024 compared to the same month last year, despite draft relief, with prices rising every month year-on-year.
But that's still a smaller increase than beer from stores, which grew by 8.6% over the same period.
Emma McClarkin, chief executive of the British Beer and Pub Association, said the duty cuts had “provided a valuable boost for brewers and pubs”, but called for further cuts in beer duty.
BBPA figures show that the same number of pubs closed in the UK in the second half of 2023 (266) as in the first half (265).
image source, Good pictures
Free childcare
Free extra childcare is one of the biggest measures.
From April 2024, eligible two-year-olds in England will be entitled to 15 hours of childcare a week – with more than 100,000 working parents signed up.
This will be extended to parents of children aged nine months to two years in September 2024, and then increased to 30 hours per week in September 2025.
A warning has also been given about the shortage of staff.
BBC analysis estimates that demand could rise by around 15%, equivalent to more than 100,000 extra children in full-time care once nine-month-olds become eligible in September 2025.
Think tank Nesta assesses Around 27,500 early career professionals will be needed in the UK to meet this.
Between 2022 and 2023 the total number of childcare workers in England is set to increase by almost 13,000.
That was Driven by the increase Staff in private providers and school-based nurseries. However, the workforce in childminders and voluntary groups continues to fall, with 5,600 fewer people in 2023 than in 2022.
In February, the government launched a campaign to recruit more staff, but said it would be too late for charities to help in the early years.
On 3 March 2024 Laura Kuensberg asked Mr Hunt if he could guarantee free childcare. He said: “You'll understand why I don't want to give an absolute guarantee. But we're offering this plan and am I sure it will be this April? Yes I am.”
“It's a big change; it means hiring 40,000 more people in the sector, which is why we're bringing it in gradually,” he added.
Back to work
One way Mr Hunt said he would encourage growth was by helping people back into work, including those out of work due to disability or long-term illness.
His measures included apprenticeships for the over-50s, the abolition of the lifetime pension and concessions to claimants who did not want to take up a fair job offer.
He said: “Excluding students, more than seven million adults of working age are out of work”.
We asked the Treasury what figures he was quoting, and it was said to be figures from December to January 2023, taking all people out of work and minus students, which actually gives a figure of over eight million.
The Official statistics Show that the number is slightly lower, but there are changes in the data, which means they are not strictly comparable.
Prepayment meter
Mr Hunt also announced measures on energy bills, which would see people using prepaid meters pay more for their energy than those paying by direct debit.
“The energy premium our poor families pay is coming to an end,” Mr Hunt said.
He has done this in two stages – initially he changed the energy price guarantee to temporarily remove the difference.
Then in February 2024, the adjuster Ofgem announced It removes from April the differences in fixed charges paid earlier by prepaid meter users.
Business investment
One of the big Budget 2023 announcements is “full costing”, which allows companies to deduct the full amount they invest in their equipment and machinery from their profits.
This means that for every pound a company invests, its taxes are reduced by up to 25p.
“The impact on our economy will be huge,” Mr Hunt said, citing the OBR as saying it would boost business investment by 3% a year.
This policy came into effect from 1st April 2023 Business investment status 6.1% higher in 2023 than in 2022.
Carl Williams, director of research at the Center for Policy Studies (CPS), welcomed the rise: “Business investment has been flat for years, contributing to weak economic growth.”
He said it was too early to say how much the rate of increase would be due to full spending, but predicted it would eventually increase by 1.5% a year.
We asked the Treasury for comments on the delivery of the 2023 budget measures.
It said: “Our childcare reforms will save parents up to £6,500 on average, and we forecast that our long-term results – including tax cuts for 29 million people and £11bn tax cuts for business – will permanently add 0.5% to the UK economy in terms of output and the number of people in work. raising it to about 200,000.”
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Additional coverage in the 2024 budget
