Autumn Statement Review – November 2023

Chancellor Jeremy Hunt has unveiled the government's road map for the upcoming year through his Autumn Statement in the House of Commons.

This outlines the tax and spending strategies that will impact individuals' finances and shed light on the allocation of funds for vital public services.

Here is a breakdown of the key measures announced.

Tax and Wages

• Main rate of National Insurance cut from 12% to 10% from 6 January, affecting 27 million people
• Class 2 National Insurance - paid by self-employed people earning more than £12,570 - abolished from April
• Class 4 National Insurance for self-employed - paid on profits between £12,570 and £50,270 - cut from 9% to 8% from April
• Legal minimum wage - known officially as the National Living Wage - to increase from £10.42 to £11.44 an hour from April
• New rate to apply to 21 and 22-year-old workers for the first time, rather than just those 23 and over

Pensions and Benefits

• The state pension will increase by 8.5% next year, in line with average earnings. It will reach £221 a week from April
• Universal Credit and other working-age benefits to increase by 6.7% from April, in line with September's inflation rate
• Local Housing Allowance rates - which determine the level of housing benefit and Universal Credit people receive to pay rent - to be unfrozen and increased to 30% of local rents
• Work Capability Assessment to be reformed to reflect availability of home working after Covid pandemic
• Funding of £1.3bn over the next five years to help people with health conditions find jobs
• Further £1.3bn to help people who have been unemployed for over a year
• Claimants deemed able to work but refuse to seek employment to lose access to their benefits and extras like free prescriptions

Business

• "Full expensing" tax break - allowing companies to deduct spending on new machinery and equipment from profits - made permanent
• The 75% business rates discount for retail, hospitality and leisure firms extended for another year
• Households living close to new pylons and transmission infrastructure to get up to £1,000 a year off energy bills for a decade.

Alcohol and Tobacco

• Duty on hand-rolling tobacco will rise by an additional 10%, but for beer, cider, wine and spirits will be frozen until August next year - a year on from the last rise.

The Chancellor said that he has taken difficult decisions, and instead of entering a recession the UK economy has grown "but the work is not done"

He said that this was an “Autumn Statement for a country that has turned a corner. An Autumn Statement for growth”.

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