Budget 2017 UK predictions: What you can expect from the chancellor’s Spring Budget
It's that time of year again: the chancellor is getting set to dust off his little red box and deliver the Spring Budget.
It's the last one we'll see at this time of year, as Philip Hammond decided to move the major announcements to an Autumn Statement schedule.
It's likely to be a more staid affair from "spreadsheet Phil" rather than a big bonanza of giveaways. The chancellor spoke of "fiscal discipline" as Britain heads towards Brexit negotiations just weeks away from triggering Article 50.
What are we expecting? Here's everything we know for certain so far…
Grammar schools
Fresh funding for schools will be unveiled, creating 70,000 new places. The government is promising £320m for 140 new free schools – those run by local communities and parents and other groups – with many expectd to be selective with Prime Minister Theresa May's plans to lift the ban on grammar schools.More cash will be earmarked for rebuilding and refurbishing existing schools to the tune of £216m.
Price of cigarettes
An "effective floor" on cigarette prices will be set following the minimum excise tax (MET) set out by Hammond's predecessor George Osborne last year. The tobacco industry could be forced to put up prices of its cheapest brands if it is higher. This is likely to be in addition to increased duty on a packet.
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Social care
Hammond is expected to promise £1.3bn for social care which is increasingly under pressure as a result of local government cuts. According to the Sun, the injection of cash is not a "sticking plaster", but a short-term plan while the government works on a longer term solution.
Getting young people into higher skilled jobs
Non-academic training for those in education after the age of 16 is a bit of a minefield. Hammond has now promised £500m a year to get things in order, and make sure young people are getting into skilled work and prepared for the so-called fourth industrial revolution.
"We will take further action to give our young people the training they need to access the highly skilled and highly paid jobs of the future. Not only is this vital for them as individuals, it is vital for British business, too. All the leading business organisations consistently tell me that access to highly skilled workers is the key prerequisite for Britain’s future economic success," said Hammond writing in the Sunday Times.
Find out more about the "T-Levels" shake-up.
Better consumer protection when it comes to subscription fees
Ever signed up for a free trial for something? Found yourself then getting charged for it even though you didn't want it? From Gym membership to Netflix or Amazon subscriptions, plans for a consultation on the matter will be announced on Wednesday, helping protect consumers from falling into such traps.
Tax hike for the self-employed
More people are working for themselves than ever before – nearly 5m – resulting in less cash going to the Treasury
Several reports suggest a three pence hike on national insurance is being considered by Hammond, bringing contributions in line with that paid by employed workers.
What else could be up Hammond's sleeve? Here's what might be on the table…
Price of a pint
A freeze on beer duty is highly likely going by the previous years of frezes. Alcohol industry groups are in fact calling for Hammond to make a cut in the light of Brexit putting pressure on prices.
Price of fuel
Fuel duty is likely to remain frozen after Hammond did just that in the Autumn Statement last year making it the seventh consecutive year without a rise. The price of fuel was up 17 per cent in January, signalling a potential squeeze on household spending as inflation in general was on the up. The chancellor is unlikely to want to add to that.
Business rates
The serious pushback from business over the hike in rates in April – the biggest in years – could trigger the government to hand out some support – businesses across the UK are certainly calling for it. The CBI wants a switch from rates calculated on the Retail Price Index to the lower Consumer Price Index. We'll see whether the chancellor will capitulate, or whether he may instead offer other brief respites to sweeten the blow. Communities secretary Sajid Javid has said he is working on more support which will be announced in the Budget.
Stamp duty
A major shake up of stamp duty was first announced in 2014.
It has hit the highest priced pads hardest, dampening demand in prime central London locations, but, the majority of first-time buyers now pay stamp duty, as rising house prices put them above the £125,000 bracket. The number paying is now at a 10 year high according to Halifax.
Some in the industry are calling for the 12 per cent rate on homes over £1.5m to be reviewed too. There hasn't yet been any hint of action from the Treasury on this, but it can't be ruled out.
Pensions
Analysts think Hammond could return to pensions reforms this Spring, although, that could be an unpopular move
Former pensions minister Steven Webb, who's now director of policy at Royal London, thinks there is still room for manoeuvre based on HMRC figures to reduce pensions tax relief.
We're likely to see more detail on the money purchase annual allowance – the amount of cash drawn from a pension which can be saved tax free – which is due to fall from £10,000 to £4,000 in April. Many are calling for this to be postponed and rethought since it flies in the face of the general move towards more pension freedoms. Whether that happens remains to be seen and the Treasury has remained tight-lipped.
The triple-lock for state pensions guaranteeing a rise at the highest of either the rate of inflation, average earnings or 2.5 per cent was kept by Hammond in the Autumn Statement. And while a change to it this Spring would likely raise more for the government to spend on much-needed social care, it would be a hugely unpopular move.
Read more on what the industry thinks is up for grabs when it comes to pensions in the Spring Budget.
Rural broadband boost
The government is considering how to boost broadband connectivity in rural areas, and that could come in the form of vouchers worth £3,000 for small businesses to spend on it, according to the Telegraph.