The Autumn Statement: Key Points
Written by Adam Foster on 22nd November 2023
Chancellor Jeremy Hunt delivered his Autumn Statement today, which provides the government the opportunity to outline its proposed spending plans.
He announced 110 measures to help grow the economy, and Spark has picked out five key points and what they mean.
National Living Wage rises to £11.44
Mr Hunt announced a rise in the National Living Wage, from £10.42 to £11.44 an hour, a rise of 9.8%, from April 2024.
This equates to a rise of £1,800 for a full-time worker, and Hunt said it is: “The largest ever cash increase” in the National Living Wage.
The wage will also be available to 21 and 22 year olds for the first time, as only workers over 23 years old receive £10.42 an hour.
Benefits and Universal Credit to rise by September inflation rate
The Chancellor announced that the Conservatives will increase Universal Credit by 6.7%, the inflation rate for September, and not 4.6%, which was the inflation rate for October.
This announcement also applies to disability benefits as well as Universal Credit and would see an average increase of £470 a year in benefits.
However, Mr Hunt did announce that he would look at cutting benefits for sick and disabled people if they did not go back to work, confirming plans for a tougher welfare regime.
He said that if people chose not to search for a job for six months: “we will close their case and stop their benefits.”
State Pensions to rise by 8.5% in April
Another measure announced by the Chancellor today was the increase of the State Pension by 8.5% from April 2024.
This equates to £221.20 a week and is worth up to £900 more a year.
Announcing the measure, Mr Hunt said: “That is one of the largest ever cash increases to the state pension – showing a Conservative government will always back our pensioners.”
Abolishing of Class 2 National Insurance
Class 2 National Insurance which is paid by almost two million self-employed people in the United Kingdom will be changed.
Today the Chancellor announced that he was abolishing the tax for self-employed people earning over £12,570. This would save the average self-employed person £192 a year.
Additionally, self-employed people who pay Class 4 National Insurance at 9% will see it cut to 8% in April.
National Insurance cut from 12% to 10% from 6 January
Mr Hunt announced the main employee National Insurance rate will be cut by 2%. This means it will be reduced to 10%, with the Chancellor saying the change will help 27 million people
This means people on an average salary of £35,000 will save over £450 a year.
Mr Hunt said: “Tomorrow I’m introducing urgent legislation to bring it in from 6 January, so that people can see the benefit in their payslip at the start of the new year.”
The Chancellor said his Autumn Statement has delivered: “The biggest tax cut in modern British history.
“An Autumn Statement for a country that has turned a corner. An Autumn Statement for growth.”
However, the Shadow Chancellor, Rachel Reeves slammed the Statement, saying: “Working people are still worse off.”
