BUDGET 2021: Council praises support for low-income families and businesses

Britain's Chancellor of the Exchequer Rishi Sunak

Britain's Chancellor of the Exchequer Rishi Sunak. (Photo by LEON NEAL/POOL/AFP via Getty Images) - Credit: POOL/AFP via Getty Images

North Somerset Council has applauded the Government's pledge to support low-income families and businesses, but leaders say no mention about social care and local government funding is ‘desperately unhelpful’ following the Chancellor's budget announcement yesterday (Wednesday).  

In his address to the House of Commons, Chancellor Rishi Sunak announced the Government's tax and spending plans for the year, supporting the UK's economic recovery and measures to help business and jobs throughout the pandemic. 

The Chancellor announced the UK economy shrank by 10 per cent in 2020 with the economy forecast to rebound in 2021, with a predicted annual growth of four per cent this year. The UK is set to borrow a peacetime record of £355billion this year, with borrowing to total £234billion in 2021-22. 

The furlough scheme will be extended until the end of September, with the Government continuing to pay 80 per cent of employees' wages for hours they cannot work. Support for the self-employed will be extended until September and 600,000 more self-employed people will be eligible for help as access to grant schemes are widened. 

The national minimum wage will increase to £8.91 an hour from £8.72 in April and a £20 weekly uplift in Universal Credit worth £1,000 a year will be extended for another six months. There are no changes to rates of income tax, national insurance or VAT and tax-free personal allowance will be frozen at £12,570 from April 2021 levels until 2026. 

The Chancellor also announced a £5billion investment in restart grants for shops and other businesses in England which have been forced to close due to coronavirus restrictions, and a lower VAT rate for hospitality firms to be maintained at a five per cent rate until September. As well as this, £6,000 per premises for non-essential outlets due to re-open in April has been promised and £18,000 for gyms, personal care providers and other hospitality and leisure businesses has been announced.  

North Somerset Council leader Don Davies and deputy leader Mike Bell.

North Somerset Council leader Don Davies and deputy leader Mike Bell. - Credit: Archant

North Somerset Council has praised the Government's budget which aims to help low-income families and support businesses, but authority leaders say they are ‘disappointed’ about no mention of social care funding and ambiguity around local government funding. 

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Council leader Don Davies, and deputy leader, Cllr Mike Bell, said: “While we await all the details, we are pleased that the chancellor has pledged to maintain the £20 uplift in universal credit for a further six months as well as increasing the national living wage. 

“He has also announced increased funding for domestic abuse programmes, as well as providing additional funding to combat mental health issues among our armed forces veterans - we welcome these announcements, too. 

“The continued support for businesses as lockdown eases and the economy begins to wake up will bring comfort to many of our local businesses who have suffered during lockdown. The reduced five per cent VAT rate will also help our hospitality and tourism sector as it gears up to welcome visitors once lockdown restrictions ease."

Council leaders added that the lack of clarity around social care funding leads to uncertainty for care staff and service users.  

They said: “However, nothing was said in the budget about the future of social care and the need for sustainable funding. Yet again, a difficult challenge has been kicked down the road in a way likely to lead to further pressure on local budgets and more uncertainty for care staff and those who rely on their services. 

“The lack of any clarity on funding for local government was desperately unhelpful, too. 

 “We’re are disappointed that the bid we were part of for a freeport at Avonmouth was not among the eight successful bidders the chancellor announced – this would have brought real benefits to our junction 21 enterprise area and we will be seeking an explanation as to why this first bid wasn’t a winning one.” 

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