Today’s announcements will affect daily life for millions of Brits (Picture: Getty/Metro.co.uk)
It’s truly the blockbuster event of the fiscal year, and the 2024 Budget has attracted even more attention than these things normally do.
That’s because an election is coming up this year – and with the Conservatives sitting in the doldrums according to most polls, many were expecting Chancellor Jeremy Hunt to produce something spectacular.
But forget the forthcoming vote, and forget all the spin coming from every political party.
What was announced today will matter to people across the UK, whether it’s the cost of childcare or how much you’ll be spending at the petrol pump.
Here are seven of the main takeaways from what was announced this afternoon.
National insurance
National insurance was lowered in the Autumn Statement too (Picture: UK Parliament)
This was arguably the headline announcement at today’s Budget.
If a 2p reduction in national insurance sounds familiar to you, that’ll be because Jeremy Hunt announced exactly the same thing at last year’s Autumn Statement.
Back in November, the chancellor cut the tax – which funds state pensions and several benefits – from 12p to 10p in the pound.
This time round, it’s been lowered further to 8p in the pound. For the self-employed, who were already paying 8p in the pound, it’s now 6p in the pound.
By the way, if all this talk of pounds and pence confuses you, it can be thought of as a percentage too – the National Insurance contribution rate has been cut by 2%, from 10% of pay to 8% from next month.
That means someone on a £35,000 full-time salary will be taking home an extra £450 or so.
Childcare
Mr Hunt said his measures would lead to an extra 60,000 parents entering the workforce over the next four years (Picture: Getty Images)
Another major theme in the Budget was supporting families with young children, both through funded childcare and a major change to the child benefit.
Let’s take the second point first. At the moment, full child benefits are paid to households where the highest-earning parent makes up to £50,000.
That limit is going to be increased to £60,000.
Previously, families would get partial payments from child benefits when the highest-earning parent makes more than £50,000 with the exact amount tapering off to a £60,000 limit. Following today’s announcement, that taper will be in place between £60,000 and £80,000.
Meanwhile, rates paid to nurseries to allow them to fund free childcare hours – as announced by Mr Hunt last year – will continue for the next two years.
Vaping and tobacco
The government hopes today’s news will discourage people from taking up vaping, while ensuring it’s still a cheaper alternative to smoking (Picture: PA)
If you smoke or vape, there was a bit of bad news for you in the Budget today: both habits are about to get more expensive.
Vaping has been a favourite target of Rishi Sunak’s government since the PM took office, though the focus has been discouraging kids from taking it up by banning bright colours and sweet flavours.
Today’s announcement will impact everyone who buys vapes, with a new levy to be introduced.
Those who aren’t keen to pay it have a good amount of time to wean themselves off though – the move will not come into effect until October 2026.
There will also be a one-off increase in tobacco duty at the same time.
Alcohol
Alcohol duty was going to raise by 3% in August before today’s announcement (Picture: Daniel Leal/AFP)
The chancellor loves talking about how much he loves ‘the great British pub’, and has previously used his budgets and statements to talk up his efforts to revitalise the industry in the wake of Covid.
The 2024 Budget was no different, even if nothing new was unveiled.
Instead, Mr Hunt announced that the freeze in alcohol duty will continue for another year.
Before today, alcohol duty had been due to rise by 3% in August.
The measure announced today will benefit 38,000 pubs across the country, the chancellor said.
Fuel
The chancellor is extending support for drivers (Picture: Getty Images/iStockphoto)
One of the less surprising announcements in today’s Budget was the continuation of the freeze on fuel duty.
This is the 14th year running that the government has declined to raise the levy in line with inflation, as it should do.
In addition, a 5p cut to fuel duty which was introduced in 2022 to help with the cost of living crisis will be kept in place.
The cut was set to run out this month.
British Isa
The new Isa will support UK-based firms like those in the City of London (Picture: Getty Images)
Savers will soon have a new Isa to choose from at the bank, with an extra perk.
They’ll be given an additional £5,000 annual savings allowance, on top of the current individual savings account allowance of £20,000.
And that £5,000 will be directed towards investment in British businesses, giving them a welcome boost.
This plan, called a British Isa, was previously mooted by business leaders and fund managers.
Energy bills
Those hoping for extra support with energy bills in today’s Budget were disappointed (Picture: PA)
This time last year, the eye-watering increase in energy bills was at the front of everyone’s minds.
The Energy Bill Discount Scheme (EBDS) came into effect last April, replacing the previous Energy Bill Relief Scheme, and was set to end at the end of this month.
Mr Hunt did not announce any specific policies targeting these bills at the Budget today, so it appears that the scheme will come to a close as planned on March 31.
This may be because gas prices fell by 26.5% and electricity prices fell by 13.0% in the year to January 2024, according to the Office for National Statistics (ONS).
However, 41% of British adults who pay energy bills told the ONS in a January survey that they still found it ‘very or somewhat difficult’ to afford them.
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