NFRN Budget Review: Key Points

The Chancellor announced a £30bn fiscal stimulus for 2020 to support the economy through coronavirus.

OBR has downgraded productivity over the forecast period; and reduced GDP growth compared to the March 2019 forecast. OBR GDP growth forecast 1.1 per cent in 2020, 1.8 percent in 2021, 1.5 percent, 1.3, 1.4 in the following years – without accounting for the coronavirus. The UK’s long-term productivity will increase by 2.5 per cent and inflation will increase to 1.8%. Borrowing will increase slightly from 2.1 percent of GDP 2019 to 2.4 percent in 2021, 2.8 percent in 2022 and falling.

Please find below the issues below that will affect our members:

Business and Employment
• Statutory sick pay will be available to all of those who are advised to self-isolate.
• £7bn to support the self-employed, businesses and vulnerable people.
• £18bn to support the economy, adding up to £30bn.
• Self-employed people will be able to access contributory employment and support allowance will be able to claim on day one.
• Businesses with fewer than 250 employees will be able to claim back their Coronavirus sick pay from the Government
• New temporary coronavirus business interruption loan scheme for SMEs, with Government able to cover up to 80% of losses.
• Increase of the NI Threshold from £8632 to £9,500.
• Planned rise in beer duty will be cancelled: Freezing duty for cider and wine drinkers.
• Entrepreneurs Relief lifetime limit will be reduced from £10 million to £1 million.
• Employment Allowance to be increased by 1/3 to £4000.
• £4.4bn to be raised by clamping down on tax avoidance.

Business rates
• Business rates retail discount: from 50% to 100% for a year for businesses with RV under £51,000
• Museums, art galleries and theatres will benefit from the 100% retail discount over the next financial year.
• Business rates discount for pubs will be £5000 for this year.
• Long-term review into the overall future of Business Rates.

Burdens on business
• Low Pay Commission will have a fixed target that the minimum wage should be 2/3 rdof Median Earning by 2024, assuming favourable economic situation.

Communities, Housing and Local Government
• 500m hardship fund for local authorities to support local people affected by coronavirus.
• Structures and Buildings allowance will be increased from 2 to 3 percent, giving an extra £100,000 of relief if you are investing in a building worth more than 10m.
• £242m of funding for new city and growth deals.

Women and Equalities
• The tampon tax will be abolished in full from January 2021.

CORONAVIRUS
• £5bn emergency fund for the NHS to support Coronavirus.
• Government to provide £150m to support IMF’s coronavirus relief efforts.
• £1.4bn to be invested in science institute researching coronavirus.
• NHS will get whatever funding it needs to tackle coronavirus — be it “millions or billions”.