Chancellor Rishi Sunak will present his next budget and spending review in the House of Commons on Wednesday, October 27, 2021.
Mr Sunak is expected to make a series of announcements as he seeks to rebalance the books after the ‘fiscal meteorite’ of the Covid-19 pandemic saw him spend billions of pounds to keep the country afloat .
A jobs plan is expected to be the focus of this autumn budget, with Mr Sunak having already announced £ 500million in funding to help people find jobs after the leave scheme ends on September 30.
As part of Boris Johnson’s ‘build back better’ strategy to move the country to a ‘high-wage, high-skill, high-productivity economy’, as outlined in his recent speech at the Conservative Party conference in Manchester, Mr Sunak is also being urged to raise the minimum wage for over 23s to £ 9.42 an hour, which he last did in his spring budget on March 3 when he had it raised to £ 8.91.
It could end the one-year public sector wage freeze, which affected 1.3 million professionals last year, including government officials, municipal staff, teachers and emergency service personnel. (frontline NHS workers were exempted) in a move the government deemed necessary at the time to bring the national deficit under control.
Mr Sunak expressed in Manchester on October 4 his preference for tax cuts while stressing that he is unlikely to be able to do so this time around given the government has borrowed a record $ 299 billion pounds sterling at the height of the pandemic between April 2020 and April 2021.
Instead, another council tax hike is likely, given that the Tories have increased local levies every year for the past 10 years and could do so again, perhaps by as much as 5%. .
The Treasury has already frozen income tax thresholds and announced an unpopular 1.25% increase in national insurance contributions to pay for health and social care, a move that went against of the Conservatives’ 2019 election manifesto promise not to raise taxes.
Climate change is expected to be a key topic as the budget comes just four days before the start of the crucial Cop26 summit of world leaders in Glasgow.
The Treasury has yet to outline its plans for how Britain can pay to achieve the 78% carbon dioxide reduction it pledged to achieve by 2035 and achieve net zero emissions from carbon by 2050.
But the government has already delayed the availability of £ 5,000 in heat pump subsidies from next April to encourage homeowners to move away from their existing gas boilers to low-carbon alternatives with a view to phasing out the heat pump. precursor dependent on fossil fuels by 2035.
In an effort to recover money, the Chancellor could also lower the threshold at which students start repaying their graduate loans.
Currently students in England and Wales pay 9% of anything they earn above £ 27,295 per year until their loan is paid off, but that could drop to £ 23,000 in the aim of recovering £ 2 billion a year faster, at low cost for new graduates.
Savvy observers have also suggested that the Treasury could significantly bolster its coffers by reducing tax breaks on retirement savings for those with high salaries or by capping the amount employees can set aside for their retirement years.