Autumn Budget and Spending Review 2023
November 23, 2023
Following on from yesterday’s autumn budget, below is a statement from Propertymark outlining the main points:
Local Housing Allowance (LHA) will at last be unfrozen and Universal Credit (UC) will rise under UK Government tax and spending plans announced by Chancellor of the Exchequer, the Rt Hon Jeremy Hunt, MP, today, 22 November 2023. Rate relief and full expensing for businesses are also included.
Vital relief for tenants on lowest incomes
Hunt committed to increasing the Local Housing Allowance rate to the 30th percentile of local market rents which he said will give 1.6 million households an average of £800 of support next year. Universal Credit will also rise by 6.7% from April 2024.
Propertymark welcomes this announcement, having lobbied for an uplift in LHA, including in our 2023 Spring and Autumn Budget representations, since the rates were frozen in 2020. As LHA has increasingly lagged behind rising rents it has effectively priced the most vulnerable tenants out of the market for private rented homes.
We will continue to urge the UK Government to go further and increase the LHA level to the 50th percentile. This will ensure that tenants have wider access to secure and affordable housing options.
Minimum wage rises
Delivering on a manifesto commitment to eliminate low pay, the minimum wage – known officially as the National Living Wage – will rise from £10.42 to £11.44 per hour in April next year.
This is a rise of 9.8% and worth up to worth up to £1,800 for a full-time worker.
National insurance reduced
From 6 January 2024, the main employee National Insurance rate will drop from 12% to 10%, saving someone on an average salary of £35,000 over £450 per year. The Chancellor said this would be pushed through with urgent legislation to begin before the new tax year.
Class 2 National Insurance for self-employed people will be abolished.
Pension triple lock maintained
The UK Government will increase the full new state pension by 8.5% to £221.20 a week, worth up to £900 more a year, from April 2024 as well as honouring their commitment to the triple lock.
Business rate relief extended
The small business multiplier will remain frozen for another 12 months. The 75% discount on business rates over £110,000 for retail, hospitality and leisure businesses will continue for a further year, saving the average independent shop over £20,000.
Full expensing made permanent
For every £1 that a business invests in IT, machinery and equipment, they can claim back 25p in corporation tax – a big benefit for companies which invest heavily in equipment, such as manufacturers.
Faster planning applications or your money back
Hunt will allow local authorities to recover the full costs of major business planning applications, in return for being required to meet guaranteed faster timelines. If they fail, these fees will be refunded automatically with the application being processed free of charge.
There will also be a change to Permitted Development Rights to allow any house to be converted into two flats, so long as there is no change to the external appearance.
