On 6 March the Chancellor of the Exchequer, Jeremy Hunt, delivered the Spring Budget, setting out his ambition to back the hard-working people of this country. We know that times have been difficult over the past few years. The crisis in Ukraine and the impact this has had on worldwide fuel and food costs, have been felt in our pockets through the high inflation of prices. During the covid-19 pandemic it was right that we supported people’s jobs and businesses but we all knew that the time would come when the government would have to start to pay back the debts that the nation had taken on. So yes, in the past few years taxes have risen as well as debt and inflation, but we are now at a turning point and there is a decision to be made on what future direction we take.
Inflation is now falling, back to four per cent, and well below its peak of 11% just over a year ago. This means that the Bank of England can start to consider cutting interest rates, and already the high street banks are reducing the mortgage rates they are offering to their customers. The economy is on the road to recovery, with the International Monetary Fund forecasting that the UK will grow faster than Japan, Germany, France and Italy over the period from 2024 to 2028. At the Budget, the Chancellor made clear that his priority, as he can afford to do so, is to reduce the burden of taxation to support people now, but also recognising that in the long run, this is also the best way to create further economic growth. Since 2010, the government has nearly doubled the personal allowance, from £6,475 in 2010-11 to £12,570 today, meaning people can earn more tax-free money a month. We will also now cut National Insurance by 4%, which will save the typical working person on an average salary £900 a year. Jeremy Hunt has also stated that it is his ambition, as the national finances improve and when it can be afforded, to abolish the national insurance tax altogether. As the economic position improves, the choice for the country is should the government increase spending and borrowing, or reduce our debts and cut taxes, giving people the freedom to determine how best to use more of the money that they have earned.
The Budget also included announcements of particular local importance as well. The Chancellor reaffirmed the government’s commitment to invest in new small modular nuclear reactors (SMRs) and invited the shortlisted companies to tender for contracts to deliver them. As I have previously written in this column, I believe that SMRs could ensure the future of the nuclear industry and Dungeness as their smaller size would allow them to be deployed on previously used land within the existing nuclear site. The government also announced further measures to back the British film industry, and particularly those international businesses looking to build new studios in this country. The announcement that new studios will receive a 40% rebate from business rates for ten years, can be a significant boost for investment in projects like the proposed new complex at Newtown in Ashford.
Published Monday 11th March 2024