The autumn 2021 budget was announced against a backdrop of a rising cost of living that threatens to leave some consumers struggling to pay for everyday essentials.
On announcing the budget, Chancellor Rishi Sunak said it would create an “economy fit for a new age”. Indeed, much of the budget was focused on investing in housing, education and infrastructure, which may have left some disappointed that there was little announced that would help consumers cope with the current rising cost of living.
During the budget there were some announcements that would help consumers, however, including the Government cancelling the planned rise in fuel duty and increasing the National Living Wage from £8.91 per hour to £9.50, which will come into effect from 1 April 2022. As well as this, those who are working and receive Universal Credit will see the taper rate cut by 8%, down from its current level of 63% to 55%, which will come into effect by 1 December 2021.
Consumers who buy alcohol may also see prices start to fall, as the Chancellor announced that the Government would simplify alcohol duty, which will see the number of rates drop from 15 to six, which the Chancellor said would reduce the tax paid on lower alcohol drinks such as rose wine, fruit ciders and lower strength beers and wine. It will, however, see a rise in tax on stronger red wines, fortified wines and high-strength ciders.
Travellers who take long-haul flights may also see the cost of air travel start to rise from April 2023 as the Chancellor announced a new ultra long haul band in Air Passenger Duty for flights of over 5,500 miles will be introduced. Meanwhile, those who take internal UK flights may find that the cost of flying becomes cheaper as flights between airports in the UK will be subject to a new lower rate of Air Passenger Duty from April 2023.
Consumers looking to get onto the property ladder in the coming years may welcome the Chancellor’s announcement that £24 billion has been earmarked for housing, which includes £11.5 billion for up to 180,000 affordable homes.
As well as this, in the days leading up to the budget announcement, it was leaked that the Government would:
- Give £6.9 billion for English city regions to spend on train, tram, bus and cycle projects.
- Give £5.9 billion to NHS England to help tackle the backlog of people waiting for tests and scans.
- Spend £2.6 billion on creating 30,000 new school places for children with special educational needs and disabilities.
- Spend £1.6 billion over three years to roll out the new T-levels for 16 to 19 year olds, as well as £550 million for adult skills in England.