Jeremy Hunt Autumn Statement RECAP: I’m £2,147 better off with pensions increase & wage boost – but I’m still worried
BRITS are starting to feel the squeeze of recession despite the Chancellor unveiling new measures to protect Britain's poorest.
In his this week, hiked pensions and benefits by 10.1 per cent, as well as lifting the National Living wage to £10.40 - but there will be hidden costs for many Brits.
Supermarket worker Alan Lunn, 71, earns the national living wage, which will go up in April by 92p an hour and give him an extra £855 a year - but the tax threshold freeze will cost him £247 despite being £2,147 better off.
He said: “That’s really, really good. The only thing that blunts it for me is my two-year fixed deal on my utilities runs out in July.
“My bills will probably double, which will likely cost an extra £80 per month. It’s more than I hoped I would get, but it looks like I may need half of it to pay for my electric and gas.
Read our autumn budget 2022 page for a breakdown of what it all means for YOU
Jeremy Hunt has offered 'big, big help'
Single mum Lyndsey Tate receives disability benefits as she suffers from rheumatoid arthritis, anxiety and PTSD.
Following the Chancellors decision to raise benefits by 10.1 per cent, Lyndsey will receive an extra £1,939 – nearly £40 a week.
She will also get a £150 cost-of-living payment.
But Lyndsey, 40, of Kellington, North Yorks, who lives with daughter Georgia, ten, will miss out on another £114.50 after child benefit was frozen.
She says: “I was getting worried about benefits claimants being left behind. That is great and a big, big help.
“We’ll be better off from April but we just have to get through winter, which is obviously the hardest.
“It’s really good though, as long as they stick to it. This time next year, it should mean things aren’t quite so difficult.
“Being forced to see a work coach doesn’t affect me. My disability has no prospect of improvement, I will only deteriorate.”
'We’ll be even less well off' after Hunt's announcement
James Arthur, a supply teacher and wife Amelie will lose out on £608 a year because of the tax allowances freeze.
They both earn £45,000 a year.
James says: “After a turbulent couple of months, it’s a sour twist that we’ll be even less well off.
“I’m not too pleased to be at this point of the rollercoaster. We’ve been up and down over the last couple of months. I think we’re paying the price for the Truss experiment and I blame her more than Rishi.
“I suppose we have to just get on with it now, but we’ll have less disposable income.”
But he was delighted the Chancellor is putting an extra £2.3billion into schools.
He says: “I welcome the commitment and I’m optimistic Rishi will deliver on his promise of improving our schools.”
'It could have been a lot worse'
Rebecca Suter earns £21,320 a year as a work-from-home hairstylist.
She will be worse off because her personal tax allowances are not going up with inflation and is worried about how she will manage after energy prices rise again in April.
The 45-year-old, from Loughborough, Leics, says: “It could have been a lot worse. But whenever there’s a Budget everything always seems to go up.
“My mortgage will be up for renewal soon, which is a real concern.
“But I think increasing the national living wage was a positive move.
“Liz Truss was right to resign as PM and I like Rishi so far. He seems level headed.
“He doesn’t make knee-jerk reactions to things and so far he seems quite trustworthy.”
'Tories have got their priorities right now'
Thanks to Jeremy Hint's Autumn statement, Michael Thorpe will see his £13,000-a-year college salary rise by £1,258.
Hunt announced yesterday that the national living wage would be going up from £9.50 to £10.42 an hour
And because he gets £3,000 a year Universal Credit, he should receive a £150 cost-of-living payment.
He says: “The Tories have got their priorities right now. They’re giving to the poor rather than the rich and thinking it will trickle down.
“It will really add up for me and it’ll mean I’ll be able to put more money on the electric meter.
“The bills are going up, but wages are going up, so it should even up. Overall, I’m happy with it.”
'It’s going to be tough'
Muhammad Afzal, a corporate security worker, earns £45,000 a year and lives wwith wife Aneela and daughter Izzah, 11, in Ilford, East London.
He will be hit by the freeze on tax allowances and child benefit.
Muhammad says: “It’s going to be tough. With everything else going on, every £100 is going to make a difference now. Things are going to be tight.
“Our mortgage renewal comes up at the end of the next year, so that will go up. We’re going to have to start saving to prepare for that.
“They talk about cutting back but there’s nothing left to cut back for us.
“I think the Conservatives have made a bit of a mess of this. They’re meant to be all about the economy, but we’ve never had it this bad.
“I’m hoping that next year inflation will be under control. Hopefully the war will end and that will bring prices down too. All we can do is hope for the best.”
Pensioners are among the big winners
Millions of seniors will get an £870 rise in state pension payments from April next year thanks to the triple lock staying.
The increase has been made in line with September’s inflation figures of 10.1%.
The triple lock rule applies to UK state pensions and means pensions must rise each year in line with the highest of three possible figures: inflation, average earnings, or 2.5%.
The full new state pension is currently £185.15 per week, while the full basic state pension is £141.85 per week.
Unite slam Labour’s response to Autumn statement
Sharon Graham, the Unite General Secretary, has slammed Labour for making the “mistake” of not challenging the “the economic premise of the black hole”.
Unite general secretary Sharon Graham has said: “Our economy is broken. This Autumn Statement is not for working people.
“The chancellor has taxed income over wealth, backed City bankers instead of nurses and chosen profiteers over public services. He has made political choices based on rules that he himself has the power to change.
“As for the Labour Party, they appear to have accepted the economic premise of the black hole rather than challenge it. That is a mistake.
“We are stuck in an economic straight-jacket. Our political class repackage the same failed approach crisis after crisis, choosing to put a sticking plaster on a wound that needs surgery.”
Rent increases for social housing tenants
Social housing tenants will face rent increases of up to 7% next year.
Mr Hunt revealed there would be an increase in the amount that social rents can be hiked in 2023 – adding up to £340 a year to bills.
Compared to previous plans, which would have seen rents go up 1% above inflation, so around 11%, that’s a roughly £200 saving.
Last year, rents increased by 1.6%.
Many social housing tenants receive full housing benefits from the government, which means the increase in rents will be picked up taxpayers.
However, around 30% of social tenants pay full rents and will be hit by the increase in full because they’re not eligible for support.
That amounts to over 1.3million tenants.
Inheritance tax freeze extended
The rate at which families start paying inheritance tax (IHT) has been frozen since 2009, and it was extended by two years until April 2028.
This will force more and more households to pay the tax as house prices and inflation continue to soar.
The threshold currently stands at £325,000 with a further residential nil-rate band set at £175,000.
Had the rate kept up with inflation, the starting point where you pay tax would be £460,000 instead of £325,000, according to MCL Accountants.
Between April 2022 and September 2022, the Treasury collected £3.5billion from IHT – £400million more than in the same period last year.
Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, said: “IHT used to be seen as a wealthy person’s tax, but a mix of booming house prices and threshold freezes mean this is no longer the case.”
Jeremy Hunt's statement contains a 'housing hole' says homelessness charity
A homlessness charity says Jeremy Hunt's new measures won't help tenants with the rising cost of rent.
Shelter chief executive Polly Neate said: “There is a housing hole in this budget - housing benefit remains frozen at 2020 levels when private rents have been rising at record rates.
“Increasing Universal Credit will really help people struggling to pay their food and fuel bills, but crucially it doesn’t cover rents which are most people’s biggest outgoing. Unless housing benefit is increased, the shortfall with real rents will only grow - swallowing up other benefit increases. The boost to benefits will be built on quicksand.
“The glimmer of hope for those at the sharp end of the housing emergency is the planned increase to the benefit cap. Raising the cap will put more money in the pockets of the hardest hit families.
"The government’s refusal to unfreeze housing benefit ignores the rental crisis that is unfolding, and means that homelessness will continue to rise this winter.”
What is the £900 cost of living payment?
The £900 cost of living payment is a support payment paid to households in the UK that are struggling the most.
The payment is part of a £26billion package announced by the government to help people during the cost of living crisis.
This payment will be tax-free and will not have any effect on any existing benefit payments that you receive.
You'll only be able to get it if you are claiming one of these benefits below.
- Income-based Jobseeker’s Allowance
- Income-related Employment and Support Allowance
- Income Support
- Pension Credit
- Tax Credits (Child Tax Credit and Working Tax Credit)
- Housing Benefit
- Council Tax Support
- Social Fund (Sure Start Maternity Grant, Funeral Payment, Cold Weather Payment)
- Universal Credit
Jeremy Hunt's announcement will 'alleviate some pressure off the NHS'
Tina Woods, CEO of Business For Health has said that Jeremy Hunt's increase to the NHS budget will act as "short-term relief".
Tina said: “Today, Jeremy Hunt has announced that he will increase the NHS budget by an extra £3.3bn in each of the next two years.
"With health care costs skyrocketing, acute health worker shortages and record long waiting lists, the funding may provide some short-term relief as winter approaches and alleviate some pressure off the NHS."However, how that funding long-term will be allocated needs addressing, alongside an effective preventative care strategy to reduce the need for health care, with consequent cost-savings."
'I’m returning to work early from my maternity leave' due to Autumn statement
Megan Dancer who is currently on maternity leave looking after eight-month-old son Louie, earns £22,000 a year.
Her partner Dan, 32, is on £24,000 as a machine operator in the steel industry.
After Kwarteng’s mini Budget in September they were set to be £617 better off.
But because the threshold when you start paying tax is now being frozen, it will cost the couple, from Bournemouth, £494 next year.
Also, child allowance payments will not rise in line with inflation, which means they will miss out on an extra £114.50.
Megan, 28, says: “It didn’t sound like we were going to come out winners this time as we’re not on benefits.
“I’m returning to work early from my maternity leave. I don’t think we’d survive if I don’t.
“Our mortgage payments are going up next September. It doesn’t feel like it’s going to get easier for some time.”
Shadow Chancellor says 'it's not right'
Rachel Reeves, the Shadow Chancellor, has claimed that Jeremy Hunt's decision to allow "big companies" to escape paying any windfall tax is "not right".
The Shadow Chancellor said: "I'm really worried about what's going to happen to people's living standards next year from April, big increases in gas and electricity bills."
She added: "Whilst the windfalls of war being made by the energy giants are still not taxed to the degree that they should be.
"We should not be having these investment allowances, which just means there are some big energy companies aren't even paying any of this windfall tax. That's not right.
"And so we would have done more on that front to alleviate some of that pressure on the ordinary working person."
Britain left with biggest tax burden since WW2
Britain was left with its biggest tax burden since World War Two yesterday as millions of workers were hit by his £24.7billion stealth raid by Jeremy Hunt.
The overall tax take will hit £1trillion by the end of this year as the Chancellor made the pips squeak.
But he delayed £30billion of painful spending cuts until after the next election — with a surprise increase in the NHS and education budgets.
With the OBR fiscal watchdog now warning the country is officially in recession, the Chancellor increased spending by an extra £9billion until 2025.
Martin Lewis says he’s pleased with Autumn announcement
Mr Lewis said: “I am very pleased that both benefits and the state pension are being increased by the 10.1% September inflation rate.
“It only happens from next April, and it will still be hard for many, but if it was less than this it would’ve been devastating.”
His comments come after Mr Hunt announced that both universal credit and pensions would go up in line with inflation.
Jeremy Hunt insists 'this is a compassionate government'
Speaking to the BBC this morning, the Chancellor has insisted that the government is "compassionate".
Hunt added: "People will feel like even despite the hardship they can do things like go to the pub. We want people to feel the government is helping them through the recession."
When asked about fuel duty increases of 23% next Spring, the Chancellor claimed the government had not reached a decision yet.
He said that it was just an "assumption" that the OBR made yesterday about an increase.
'There is nothing Conservative about not tackling inflation'
Jeremy Hunt has stated that there is "nothing Conservative about ducking decisions that put the economy on track" as he told Brits "we're doing absolutely everything we can to help people".
Speaking to Sky News this morning, Jeremy Hunt said: "What I would say to my Conservative colleagues is there is nothing Conservative about spending money that you haven't got.
"There is nothing Conservative about not tackling inflation.
"There's nothing Conservative about ducking difficult decisions that put the economy on track.
"And we've done all of those things.
"And that's why this is a very Conservative package to make sure that we sort out the economy, which is one of the most important things that people expect from us as a party."
There could've been 'fairer choices' according to Labour
Shadow chancellor Rachel Reeves has claimed "fairer choices" could have been made on tax by Jeremy Hunt.
Speaking to the BBC this morning, Reeves said "we need a serious plan to grow our economy".
She added: "If (the government) did some of those things, (it) wouldn't have needed to increase taxes on ordinary people. This government comes time and again for the pockets of the ordinary man and woman rather than for those with the broader shoulders."
Autumn statement overview
Jeremy Hunt raised taxes and squeezed spending in a scramble to balance the books - but put an arm around the poorest.
In his the hiked pensions and benefits by 10.1 per cent, as well as lifting the National Living wage to £10.40.
To cushion rising energy costs he promised a whopping £900 cost of living payment to eight million benefits claimants and an extra £300 for vulnerable pensioners.
However millions of workers are being clobbered for more tax, with the richest bearing the brunt of changes to the thresholds.
In a mixed statement, Mr Hunt said recession-rocked Britain needs to “face into the storm” with tough choices to confront a £56billion black hole.
New nuclear power plant confirmed
The long-awaited announcement of nuclear power plant Sizewell C was confirmed yesterday.
Jeremy Hunt said: “Subject to final government approvals, the contracts for the initial investment will be signed with relevant parties, including EDF, in the coming weeks.”
Hunt’s statement branded ‘cost of chaos’ budget by Lib Dems
The Liberal Democrats’ Treasury spokeswoman, labelled Autumn Statement the “cost of chaos budget”.
Sarah Olney said: “This is the cost of chaos budget. Everyone is being forced to pay the price for this Conservative government’s incompetence.
“After crashing the economy and sending mortgage bills spiralling, the government is now inflicting eye-watering tax hikes and real-terms cuts to our public services. The country shouldn’t be forced to clean up their mess.
“Britain needs a fair plan to get through this cost of living crisis, yet today confirms we have a chaotic Conservative government lurching from crisis to crisis. They have let oil and gas firms escape a proper windfall tax for months whilst shamelessly cutting taxes for the big banks. This is an out of touch Government which has no plan to help people with their bills.”
Autumn Statement: The key points
In yesterday's Autumn Statement, Jeremy Hunt announced:
- Up to £1,350 in cost of living payments – £900 for benefit claimants, £300 for pensioners and £150 for Brits with a disability
- Pension triple lock to stay in yearly £870 state pension boost for seniors
- Benefits including Universal Credit and pension credit to rise in line with inflation
- Changes to benefits and Universal Credit, including new work coach requirements
- Social housing rents to rise 7%, adding £340 to bills
- Freeze on income tax and National Insurance thresholds until 2028
- Stamp duty cut to end in 2025
- Typical energy bills to be capped at £3,000 from April
- Minimum wage to rise to £10.42 an hour
- Extra windfall tax for energy firms
- One million to get £100 for heating oil costs
- Extra £6billion for insulation grants to cut energy bills by £450
- Electric car owners to pay road tax from 2025
- Dividend allowance halved, inheritance tax and VAT threshold held for another two years
Will the price of cigarettes go up?
Smokers won’t have to pay more for a pack of cigarettes as Chancellor Jeremy Hunt didn’t announce plans to hike rates in his announcement yesterday.
A hike wasn’t expected as the duty is usually changed in the Spring Budget.
Tobacco duty is a tax charged to companies making or importing cigarettes in the UK.
When the tax is raised, the cost is passed on to consumers who have to pay more for tobacco products in the shops.
Cigarette prices were last hiked in October last year, when 88p was added to the most expensive packs of fags, increasing their cost from £12.73 to just over £13.60.
The cheapest 20 packs jumped by 63p from £9.10 to £9.73.
GRAPHIC: Stamp duty threshold rises
