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It’s Budget day today. What is the Chancellor expected to announce?

   NEWS / 03 Mar 2021

Published: 03 March 2021

By Suzanne Evans, Director, Political Insight


It’s Budget day today. What is the Chancellor expected to announce? These are the measures either briefed in advance or the subject of strong speculation:

  • The furlough scheme is to be expanded until September
  • The self-employed income support scheme is to be extended to an estimated 600,000 people who became self-employed in 2019/20 and were previously not covered by the scheme
  • Tax rises to plug the £400bn deficit: specifically an increase in corporation tax from 19% to between 20-23% and an increase in capital gains tax to bring it in line with income tax
  • A one-off windfall tax on businesses that have done well from the crisis, such as supermarkets and/or online retailers
  • A new tax on online deliveries
  • Changes to taxation for the self-employed
  • The announcement of sovereign green savings bonds, to fund renewable energy and clean transportation projects
  • A revamped Future Fund, set up last year to help startups survive the COVID-19 crisis, now focussing on scale-ups, with a £375m budget
  • A ‘Help to Grow; scheme costing £520m to enable top business schools to offer MBA-style management training to small businesses
  • An extra £126m into the traineeship scheme, with payments of £2,000 per trainee rising to £3,000, and a new "flexi-job" apprenticeship.
  • A new covid-survival business loan scheme, offering loans up to £10m with a 80% state guarantee
  • A new £100m fraud task force to catch those fraudulently using Bounce Back loan schemes
  • Plans for a "fast track" visa scheme for highly skilled workers looking to join UK tech startups
  • Business reopening support, with individual businesses able to claim up to £18,000 each, as part of a scheme will be worth £5bn in total
  • The £20-a-week temporary increase in universal credit extended for a further six months
  • An extension to business rates relief and a VAT freeze for leisure and hospitality
  • Stamp Duty holiday extension until June
  • First-time buyers able to access 5% government-backed mortgages for house purchases up to £600,000
  • Billions earmarked for the already announced UK Infrastructure Bank
  • A £150m funding pot to allow communities to take over their local pubs, sports clubs and theatres hit by the pandemic
  • A £300m recovery package for sport and £400m for the arts
  • Another £1.65bn in funding for the UK's vaccine rollout programme; a further £33m to vaccine testing and development; and £22m to test vaccine combination efficacy.

Britain's biggest banks are opposing a possible Budget announcement to increase contactless payment limits from £45 to £100 because of the growing fraud risk.
 
More than 125,000 UK employers have now repaid more than £700m in furlough grants, handing back some or all of their coronavirus job retention scheme subsidies, according to data obtained by Yahoo Finance UK through a freedom of information request.
 
National Grid is leading an industry rebellion against the energy regulator Ofgem’s plans to halve the returns allowed on investment in the UK’s transmission cables and gas pipes to protect household energy bills. National Grid is referring parts of Ofgem’s new regulatory plan to the Competition and Markets Authority, because it does not allow large enough returns for its investment in the UK’s gas pipes and electricity wires. Other energy network firms, including Scottish Power and SSE, are expected to follow suit later today.
 
The BBC reports that a million UK energy customers that switched providers could have been overcharged, according to Ofgem. Ovo Energy and Shell were named as the worst offenders, with British Gas, E.On, EDF, Npower, Scottish Power, SSE and Octopus among a total of 18 suppliers whose errors led to excess bills adding up to £7.2m. The refunds, plus compensation have led to payouts of £10.4m.

Taylor Wimpey
, one of the UK’s biggest housebuilders, has set aside £125m to replace cladding and carry out other fire safety work on its apartment buildings after huge flaws were uncovered in the wake of the 2017 Grenfell fire. The company said the fund would support fire safety work for leaseholders in apartment blocks built in the past 20 years, including those below 18 metres in height.
 
The owners of the Daily Mail have bought the leading science magazine, New Scientist, for £70m in cash. 
 
Estate agency chain Foxtons said on yesterday that it has bought Douglas & Gordon for £14.25m in cash.
 
Builders' merchant Travis Perkins has swung to a full-year loss of £7.7m from a profit of £180.8m the year before; has re-started the process to demerge Wickes; and is to reinstate dividend payments.
 
Shares in fast fashion retailer Boohoo fell sharply yesterday following reports by Sky News  that the US Customs and Border Protection may ban the company from exporting to the US following petitions from groups campaigning against modern slavery.
 
The Chairman of mining company Rio Tinto and a director are to step down over the destruction of two ancient Aboriginal rock shelters, destroyed for an iron ore mine in Western Australia last year. A public and investor backlash led to the resignation of then-chief executive Jean-Sebastien Jacques and two deputies. However, last month the mining giant's remuneration committee handed large payouts to all three executives.
 
The Financial Conduct Authority has launched a consultation into pre-paid funerals, hoping to improve standards in the sector. The FCA will oversee the industry from July next year. A ban on cold-calling is among changes on the table.
 
Market research firm Kantar says Brits spent an extra £15.2bn on groceries last year, equivalent to 7 billion extra meals eaten at home and 2 billion cups of tea drunk since last spring.
 
Only 25% of office workers in the UK plan on returning to their workplace on a full-time basis once normality returns, according to a study by digital coaching provider Ezra. 46% felt they were as equally productive at home; 35% stated they were more productive; and only 19% of the 2,175 office workers surveyed said remote working had a detrimental effect to their productivity.
 
Black women are the least likely to be among the UK’s top earners, according to a study by The London School of Economics. A analysis of pay over the past 17 years established that while all women experience substantial differences in pay, hours and representation in top jobs, it is Black women, regardless of whether they are UK born, who have the lowest probabilities of being top earners. While 1.3% of UK-born white men are in the top 1% of high earners, only 0.2% of UK-born white women and less than 0.1% of UK-born black women feature. Overall, the biggest differences between black and white women are in banking, finance and insurance.


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