The Live 2021 Budget Thread

[Ozzy]

For those of you who will be watching the budget announcement at lunchtime today, to hear anything that hasn't already been *cough* leaked *cough* to the press do share your thoughts here.

If I've got this right, you can watch the live stream when it happens here;
https://parliamentlive.tv/event/index/a491e75e-ca0c-493c-8d5f-355dfd2adcf3

If I've got that wrong it will also be live streaming on BBC, Twitter and others.

My colleague @JCBrown will be posting some of the main headlines here as he hears them, and it would be good to gather some of your feedback on the effects you feel these announcements could have on yours and/or UK business in general #WeNeedThumbsUpEmoji

 

[Mark T Jones]

I think there should be a tax on nurses & the NHS.

 

[JCBrown]

I'm interested to hear any bombshells they might drop seen as a few things have conveniently been leaked to gauge public reaction.

The media hype surrounding this day has been like a world cup final!

Hopefully, the day doesn't let us down!

 

[Ozzy]

Hopefully, the day doesn't let us down!

You seem more excited than most

Predictions, purely thinking of business here and ignoring anything domestic;

• Lots of cheers and jostling and a big thing made about funding being allocated to the Levelling Up agenda to boost the economies outside of London (relating to the public consultation questions we asked here on UKBF a little while back to give the Government input into whatever will be announced later).
• He'll brush over the reducing of tax surcharge on banks, but sticking with the increase in corporation tax across business, but some form of aspiration will be announced to reduce tax over a 4 or 5 year period as the cost of Covid support packages are recovered.
• A bit of a panic about inflation and interest rate rises.

What I hope to hear is some form of investment put into recovering the billions lots due to BBL and Furough fraud, but probably won't.

 

[Mark T Jones]

What I hope to hear is some form of investment put into recovering the billions lots due to BBL and Furough fraud, but probably won't.

I wonder what the political temerature is on that - kind of hot & cold.

I can say for sure that they are investing big money in BBL / CBILS recovery - including retaining some top accountancy firms; but it seems to be more covert than political flag-waving.

 

[Ozzy]

but it seems to be more covert than political flag-waving.

My suspicion is that they are going after the opportunist fraudsters, the long hanging fruit, but cannot make too much noise about it as questions would be asked "what about the organised fraud", the big ticket stuff. The opportunistic fraudsters will recover some, what hasn't been blown on holidays and unrecoverable purchases, but I suspect will end up just being a drop in the ocean.

HMRC estimate Furlough fraud to have been about £3.5bn
Various estimated on the BBL fraud have that valued at around £27bn
I doubt we'll see 10% of that recovered, probably not even 5%.

They'd be seen as going after the small time criminals and letting the big times get away with it, and that isn't good for their image. We'll just see a fee press releases when they make a million or so recovery here or there. The big money is already out of the country.

Anyway, my first shareholder has arrived for my board meeting so I'm off to answer questions about my own budget now

 

[JCBrown]

NON-BUSINESS UPDATE

According to Nick Eardley (Political correspondent), Sources confirm changes to universal credit expected.

Senior figures expect the chancellor to allow in-work claimants to keep more of the money they earn, by changing the taper rate.

Under the current taper rate, claimants currently lose 63p in benefits for every extra pound they earn.

The Treasury has refused to comment.

There is also speculation there may be other changes linked to universal credit, after lobbying by Tory MPs and others.

The decision to cut the £20-a-week universal credit increase, brought in to help low income families through the pandemic, was met with widespread criticism when it was withdrawn at the beginning of this month.

 

[Ian J]

I think there should be a tax on nurses

My nurse wife is taxing enough already thank you

 

[IanSuth]

My nurse wife is taxing enough already thank you

A bigger issue would appear to be that the promised public sector payrises next year will have to come from departmental budgets and not any extra cash. So along with the employers NIC rise large workforce departments such as Health & Defence are going to have to find a magic money tree

 

[JCBrown]

Sunak tells cabinet Budget will deliver 'stronger economy'

Rishi Sunak has been giving a very upbeat message to his ministerial colleagues this morning, telling them his Budget "will deliver a stronger economy for the British people".

Downing Street says he briefed fellow cabinet ministers that the levelling-up agenda is the "golden thread" running through his approach.

 

[JCBrown]

What do we know so far?

• The National Living Wage for people aged 23 and over will rise to £9.50 an hour, while a pay freeze on public sector wages will be lifted.
• The taper rate on universal credit is also expected to be cut, though government has ruled out a cut in VAT on energy bills.
• There will also be an allocation of £1.8bn for building around 160,000 new homes on brownfield sites in England.

 

[IanSuth]

• There will also be an allocation of £1.8bn for building around 160,000 new homes on brownfield sites in England.

Do we know if this is new money or existing and what is the £1.8bn for;- subsidies to buyers, clean up costs, bribes to developers to put some "affordable housing" in larger developments, money to councils for infrastructure to support the housing ? £11.2k per house is not a lot to do much with when the average newbuild house price was £323,367 in June https://propertyindustryeye.com/average-new-build-price-premium-is-29/

 

[JCBrown]

HERE WE GO

 

[bodgitt&scarperLTD]

I'm only back in the office for lunch but will check this thread again later, great idea

 

[JCBrown]

Rishi Sunak's big day starts with a rollocking from the Deputy Speaker, Dame Eleanor Laing.

You have announced too much of it already, she tells him - you should save it for MPs first.

She then adds she looks forward to hearing "the remainder of your announcements". Ouch.

 

[bodgitt&scarperLTD]

Rishi Sunak's big day starts with a rollocking from the Deputy Speaker, Dame Eleanor Laing.

You have announced too much of it already, she tells him - you should save it for MPs first.

She then adds she looks forward to hearing "the remainder of your announcements". Ouch.

Burn!

 

[JCBrown]

Sunak: A stronger economy for the people

The chancellor opens his big speech by acknowledging the pre-briefing to the media before the Budget, saying he has listened "very carefully" to the Speaker's concerns.

After sending his best wishes to Sir Keir Starmer, he then begins his speech properly, saying: "Employment is up, investment is growing, public services are improving, public finances are stabilising and wages are rising."

Sunak promises his Budget will deliver a "stronger economy for the British people" and leave them in "no doubt" the government's plan is working.

Along with broad pledges on a high skilled economy and world class public services, he also makes his first mention of the phrase "levelling up", saying it is the "birth right of every child in an independent and prosperous United Kingdom" to succeed.

 

[JCBrown]

'Budget a foundation for future'

Sunak says the Budget does "not draw a line under Covid" and warns of challenging months ahead.

But he says it does begin the work of preparing for a new economy after the pandemic.

The chancellor says it will be "an economy fit for a new age of optimism - where the only limit to our potential is the effort we are prepared to put in and the sacrifices we are prepared to make".

He adds: "That is the stronger economy of the future. And this Budget is the foundation."

 

[JCBrown]

Government 'willing to act' on inflation

Next Sunak addresses rising inflation, saying it hit 3.1% and is likely to rise further.

He puts it down to global factors of the world opening up after the pandemic and demands for goods increasing.

"But where the government can ease these pressures, we will act," he says, announcing new funding to improve lorry park facilities.

"We’ve already suspended the HGV levy until August and I can do more today extending it for a further year until 2023, and freezing Vehicle Excise Duty for heavy goods vehicles."

He reveals he has written to the governor of the Bank of England today "to reaffirm their remit to achieve low and stable inflation".

Sunak adds: "People should be reassured [as] they have a strong track record in doing so.

"I understand people are concerned about global inflation – but they have a government here at home ready and willing to act."

 

[JCBrown]

Sunak positive on unemployment

Sunak has moved on to Office for Budget Responsibility (OBR) forecasts about the state of the economy.

He says the OBR expects unemployment to peak at 5.2% - which means "over two million fewer people out of work than previously feared".

That's "because of the actions we took to support our economy" during the pandemic he says.

Ministers have been "more successful than previously feared in preventing the long-term economic damage of Covid" he adds.

 

[JCBrown]

Sunak outlines his four fiscal rules

Rishi Sunak says he has made "four fiscal rules in this Budget".

He says the fiscal situation in the UK is between four to six times more "sensitive" than it was before the pandemic, so forecasts have been adjusted.

Secondly, he says he wants to continue to help working families.

Thirdly, he says he wants to meet obligations to the world's poorest people. He says if recovery is strong, then the government will be able to return to spending 0.7% of GDP on overseas aid by 2024.

And finally, he says spending is growing by 3.8% a year in real terms. Contrary to speculation, he says, there will be a real terms increase in spending for every government department.

"The conservatives are the real party of public services," he says.

 

[JCBrown]

Sunak: Immigration policies to attract highly skilled

The chancellor is talking about innovation, one of the key things he says he wants to invest in for the economy of the future.

The UK is already a world-leader he says - with less than 1% of the world’s population, we have four of the world’s top 20 universities

He says he will maintain the target to increase research and development investment (R&D) investment to £22bn.

Referring to new immigration policies, he says the Scale-Up Visa system will make it quicker and easier for fast-growing businesses to bring in highly-skilled individuals.

It will help "identify, attract and relocate the best global talent in key science and tech sectors" he says and is "all part of our plan to make our visa system for international talent the most competitive in the world".

 

[JCBrown]

Hospitality gets 50% rates discount

Sunak says he wants "to help those businesses hardest hit by the pandemic".

He confirms a new 50% business rates discount for companies in the retail, hospitality, and leisure sectors, lasting for one year.

"Pubs, music venues, cinemas, restaurants, hotels, theatres, gyms, any eligible business can claim a discount on their bills of 50%, up to a maximum of £110,000," he says.

Alongside the Small Business Rates Relief, the chancellor claims his measures mean more than 90% of all retail, hospitality and leisure businesses will see a discount of at least 50%.

"Apart from the Covid reliefs, this is the biggest single-year cut to business rates in 30 years," he adds.

"We’re unleashing the dynamism and creativity of British businesses with a simpler, fairer, more competitive tax system."

 

[JCBrown]

Sunak: Jobs, growth and wages up

Rishi Sunak says jobs, growth and wages are all up, and there will be a pay rise for more than two million people.

At the same time, the government will be investing in infrastructure and skills, he states.

Public finances will be "back in a better place" and the Budget helps with working families, he says.

He says the Budget will build a stronger economy for British people.

He sits down, to cheers from Conservatives and shouts of "more" from backbench Tory MPs.

 

[JCBrown]

A new 50% business rates discount for companies in the retail, hospitality, and leisure sectors, lasting for one year.

 

[japancool]

I think there should be a tax on nurses

Tax on nurses, tax on the causes of nurses.

 

[japancool]

Rishi Sunak's big day starts with a rollocking from the Deputy Speaker, Dame Eleanor Laing.

You have announced too much of it already, she tells him - you should save it for MPs first.

She then adds she looks forward to hearing "the remainder of your announcements". Ouch.

But why does it matter? MPs aren't going to change any of it.

 

[japancool]

A new 50% business rates discount for companies in the retail, hospitality, and leisure sectors, lasting for one year.

Sticking plaster?

 

[JCBrown]

Sticking plaster?

No business should fall in love with that! By the time they start celebrating that one year would have already finished

 

[IanSuth]

Sticking plaster?

Who is paying the 50% rebate, the gov by refunding local councils or local councils out of their budgets or the govt just foregoing it's 50% (assuming it is still council gets 50% exchequer gets 50%) ?

 

[Paul Norman]

Sunak: Immigration policies to attract highly skilled

The chancellor is talking about innovation, one of the key things he says he wants to invest in for the economy of the future.

The UK is already a world-leader he says - with less than 1% of the world’s population, we have four of the world’s top 20 universities

He says he will maintain the target to increase research and development investment (R&D) investment to £22bn.

Referring to new immigration policies, he says the Scale-Up Visa system will make it quicker and easier for fast-growing businesses to bring in highly-skilled individuals.

It will help "identify, attract and relocate the best global talent in key science and tech sectors" he says and is "all part of our plan to make our visa system for international talent the most competitive in the world".

Who decides who is highly skilled? We need Truck drivers, fruit pickers, medical stuff and, locally bus drivers?

A better term than highly skilled would be to talk about skills where we have a shortage.

 

[Paul Norman]

Who is paying the 50% rebate, the gov by refunding local councils or local councils out of their budgets or the govt just foregoing it's 50% (assuming it is still council gets 50% exchequer gets 50%) ?

I guess the hope is that to at least some extent this will fuel some of the empty stores to reopen, and the councils will receive at least some rates from premises not having rates paid at the moment.

Of course, that is a risk. But I reckon this is a risk that was needed unless we want the remaining three shops in your High Street to close next week.

It will be fine, provided that some more robust, and lasting, thinking happens on the topic.

 

[Ozzy]

Well, Wetherspoons shares have been given a boost today I see....

 

[Ozzy]

My quick scan of the highlights hasn't shown much that will effect business owners.
A small increase in dividend tax of 1.25% which in the scheme of things isn't much. I feel the national living range impact is more of an impact more larger businesses with high numbers of minimum wage staff, more in the fast food and hospitality sectors.
Overall I was dreading the worse because we know the billions spent during C19 will have ramped up huge debt, and it's how that is to be repaid that hangs in the air.

Personally, I'm pleased to see the headline about the brown field development investment but I don't understand enough about that sector to know the impact. I just like the prospect of less green field development and more utilisation of brown field.

 

[Deleted member 59730]

What will make a big difference is what funds local councils get to make the sort of changes which affect peoples lives.

Bojo the Clown promised Cornwall that he would replace EU funding. So far he is £97 million short on his promise. He also promised Millions to improve the hospital in Cornwall while waving artists impressions which were 17 years old. The cheque is still to arrive.

 

[Paul Norman]

My quick scan of the highlights hasn't shown much that will effect business owners.
A small increase in dividend tax of 1.25% which in the scheme of things isn't much. I feel the national living range impact is more of an impact more larger businesses with high numbers of minimum wage staff, more in the fast food and hospitality sectors.
Overall I was dreading the worse because we know the billions spent during C19 will have ramped up huge debt, and it's how that is to be repaid that hangs in the air.

Personally, I'm pleased to see the headline about the brown field development investment but I don't understand enough about that sector to know the impact. I just like the prospect of less green field development and more utilisation of brown field.

You are correct. The corporation tax change is not going to make a massive impact to small businesses, and the minimum wage will most impact on large players with large percentages of their payroll on low pay.

It will make zero difference to our business, but, in fairness, we are not really looking out for any gains. A decent economy, and we can press on.

 

[Paul Norman]

What will make a big difference is what funds local councils get to make the sort of changes which affect peoples lives.

Bojo the Clown promised Cornwall that he would replace EU funding. So far he is £97 million short on his promise. He also promised Millions to improve the hospital in Cornwall while waving artists impressions which were 17 years old. The cheque is still to arrive.

He did say that. But surely, no one acted on that. He was never, ever going to do that. If people in those regions thought that was going to happen one can only describe that as massively gullible.

 

[Paul Norman]

Well, Wetherspoons shares have been given a boost today I see....

I understand that Tim is having a bit of a profitability challenge. This help warms the heart a little.

He was a loyal supporter of Brexit. This is his dividend.

 

[IanSuth]

He did say that. But surely, no one acted on that. He was never, ever going to do that. If people in those regions thought that was going to happen one can only describe that as massively gullible.

Then describe them as such

My motherinlaw is on the devon/Cornwall border and at the time my sister in law was living nr Hayle and teaching in Camborne which must be one of the places with the highest EU derived funding, yet many many many of the people she was talking to (enough to have persuaded her to vote leave until we had a discussion) were convinced that the SW was being held back by EU farming an fisheries rules and along with the Vote Leave promises to make up any shortfall they were in for a bonanza

(I will add the in laws old farm ended up as part of Zak Goldsmiths holdings and having see both what he did and the amount of EU funding he got for doing it - which was revealed when he sold up and needed new purchasers to indemnify him against paying it back - there are some very big Pinocchio noses in the area)

 

[Bob Morgan]

MEMO TO SELF: Review again after Interest Rate increases!