Budget of short-term gains fails to tackle need for long-term change
This afternoon, Chancellor Jeremy Hunt has delivered the final Spring Budget of this Parliament before the next General Election.
His announcement included plans to cut National Insurance, abolish the non-dom tax status and reform eligibility for Child Benefit among higher earners.
In other announcements relevant to the work of the Centre for Ageing Better, the Chancellor committed to:
- A new devolution deal with the North East Mayoral Combined Authority alongside new Level 2 devolution agreements with Buckinghamshire Council, Surrey County Council, and Warwickshire County Council.
- Further exploration of how savers could be allowed to take their pension pots with them when changing employers.
- The abolition of the Furnished Holiday Lettings tax regime and Stamp Duty Land Tax: Multiple Dwellings Relief.
- Allowing local authorities (LAs) additional flexibility in their use of Right to Buy receipts.
Changes to Stamp Duty designed to incentivise and help older homeowners to move, rumoured prior to today’s Budget announcement, did not materialise.
Dr Carole Easton OBE, Chief Executive at the Centre for Ageing Better, said:
“It is disappointing that this last Spring Budget before an election is focused on short-term gains rather than long-term change. A tax cut here and there will no doubt generate positive headlines for a day and quieten internal critics. But they won’t tackle the systemic issues our country faces.
“This Budget offered only fleeting reference to increasing housing supply, and even then worryingly framed as building homes for young people when there is demand for new homes across all age ranges.
“It is also very disappointing to see nothing in this Budget about improving the health and safety of our existing housing stock. With 8 million people currently living in homes that are dangerous to their health, it is disappointing to see little new money or initiatives to help people improve the energy efficiency of their homes, carry out urgent repairs or install aids and adaptations. Having huge numbers of people living in non-decent homes inevitably leads to increased costs and pressures on the NHS while investing in repairing these homes would stimulate significant economic growth.
“This time last year, the Chancellor promised significant back-to-work support for the over 50s. This would have been invaluable in tackling the labour and skills shortage our economy needs resolving. In reality, this was not what the Chancellor delivered and the risks to our economy of an unsupported and underutilised workforce are greater than ever.
“Overhaul of employment support for jobseekers aged over 50 is desperately needed as outcomes are so poor at present but we’re still waiting to hear how older workers specifically will be served by promised investment in these programmes.
“The Chancellor’s headline measure on back-to-work support was in fact a tax cut – specifically a National Insurance cut. He indicated that this would increase workforce participation. But the Office for Budget Responsibility’s analysis suggests that most of the employment increase from National Insurance cuts come from people increasing their hours, not newly entering the workforce. Getting the over 50s back to work will involve a much more targeted response.
“We have to do better by our older workers – for the sake of all workers who will approach retirement in the coming decades as well as for the sake of businesses and the wider economy. We need a national, targeted programme of 50 Plus employment support and clear targets to drive up performance across the board – to ensure that workers in their 50s, 60s and beyond are given fair opportunities to contribute and thrive in the workplace.”