Indycube Community - response to the Autumn Budget (November 2017)
Some predicted a bold Budget, to create the all-important political narrative and to show that the government were in control, while others thought Philip Hammond might play it safe to minimise opposition to the proposals. There were a few interesting aspects, but sadly not anything that will make daily life easier for indy workers.
Headline announcements included the abolition of stamp duty on properties of up to £300,000 for first time buyers in England, Northern Ireland and Wales (for properties costing up to £500,000, no stamp duty will be paid on the first £300,000). It’s worth noting that the situation in Wales will be slightly different from April 2018, when the new Land Transaction Tax (LTT) comes into effect - with 5% on homes priced between £250,001 and £400,000. A stamp duty announcement was widely anticipated and has been received with mixed responses, with some fearing that this will push up prices and not address the huge deposits required to buy property. The Chancellor stated that the housing focus would be on urban areas - ‘where people want to live’ - which hardly helps the towns and villages struggling to retain talent and spending as so many have little choice but to move to cities.
Amid mounting pressure to address story after story about damage caused by Universal Credit and it’s roll-out, the Chancellor did acknowledge concerns over 'operational delivery'. He announced changes to entitlement to housing benefit, as well as online access to and repayment of advances. Disappointingly to many, there was no change to waiting periods beyond scrapping the seven day wait before people are entitled to payments is a step in the right direction (meaning that a five week wait for payments is still realistic for many claimants).
Also announced was that councils will be allowed to charge 100% council tax premium on empty properties, and that there will be a review of delays between granting of planning permission grants and the start of building work.
There was no change to the public sector pay freeze - although the Budget did include a commitment to funding a pay rise for NHS nursing staff, if negotiations on wider NHS pay reform are successful The Chancellor pledged an additional £2.8bn of one-off NHS funding, £350m of which will be made available immediately and £1.6bn in 2018/19. While the extra funds will help, it falls short of the extra £4bn that NHS Chief Executive Simon Stevens said was needed in 2018/2019. There was also no mention of social care, an ongoing concern.
Other features of the statement were an acknowledgement of the UK’s dwindling productivity, and increases to the Personal Allowance (to £11,850) and Higher Rate Threshold (to £46,350). The National Minimum Wage will rise to £7.38 for 21-24-year-olds and £5.90 per hour for 18-20-year-olds, and the National Living Wage to £7.83 from £7.50 per hour.
There wasn’t a great deal in the way of support for independent, self-employed and freelance workers, despite Philip Hammond’s claim that he recognised the 'vibrancy and resilience' that small businesses bring to the economy. Here are the handful of points that will affect indie workers:
- From April 2018, business rates in England will rise in line with the lower Consumer Prices Index (CPI) measure of inflation, not the Retail Prices Index (RPI). This measure was planned, but has been brought forward by two years. Rates were due to go up in line with September's RPI of 3.9%, while CPI was 3%
- There will be a clean air fund and diesel supplement for cars, but white van men/women will not be affected
- The VAT threshold will not be reduced, and Chancellor will NOT reduce threshold at which small businesses pay VAT. He's leaving it at £85,000
- IR35 will be consulted on before being extended to the private sector
Not mentioned were pensions for the self employed (or anyone - a marked change from previous Budgets) or the horrendous impact of Universal Credit’s Minimum Income Floor on the take home pay of the self-employed. Overall, we feel that there were many missed opportunities in this Budget, and that indy workers haven’t been given much to make them feel valued - economically or otherwise.
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