Spending Review & Autumn Statement – 2015

Brief case 4The Autumn statement was made on 25th November by the Chancellor of the Exchequer, George Osborne.

PLEASE NOTE:  This snapshot is not intended as an in-depth analysis of the Chancellor’s speech, but we hope this brief summary helps you gain a quick grasp on the key points delivered by the Chancellor from the Dispatch box.

Spending Review

  • Government pledges that £12bn of welfare savings mentioned in the summer 2015 Budget will be delivered in full
  • Public spending to be £756bn in 2015, £773bn in 2016, £787bn in 2017, £801bn in 2018 and £821bn in 2019
  • NHS – 25% cut in Whitehall budget at Department of Health
  • NHS – £101bn budget today to rise to £120bn by 2020/21 – enabling NHS availability 7 days a week
  • Police – No cuts in budget
  • Defence – Defence budget to rise to £40bn.
  • Foreign & Commonwealth Office – Budget maintained
  • Department of Transport – Department’s operational budget to fall by 37% but spending on UK transport infrastructure will increase by 50% to £61bn (London will get £11bn of investment in transport infrastructure)
  • Department of Work & Pensions – 14% savings to be made on resource budget
  • Department of Energy & Climate Change – Budget to fall by 22%
  • Culture, Media & Sport –budget to fall by 22% but greater commitment to museums and 29% increase in budget for UK sport
  • Overseas Development – Budget to be increased

Forecasts

  • The Chancellor announced adjustments to previous growth forecasts from those previously announced in the summer 2015 Budget.
    • Growth forecast for 2015 – revised upwards to 2.4%
    • Growth forecast for 2016 – revised upwards to 2.4%
    • Growth forecast for 2017 – revised upwards to 2.5%
    • Growth forecast for 2018 – revised upwards to 2.4%
    • Growth forecast for 2019 – revised upwards to 2.3%
    • OBR borrowing forecast revised down to £73.5 billion for 2015/16 (taking account of new statistical data) – Government will borrow less than forecast over subsequent years, reaching a surplus of £10.1bn in 2019/20
    • OBR states national debt now decreased to 82.5% of GDP (taking account of new statistical data)

Taxation/Welfare

  • Tax credit taper rate and thresholds to remain unchanged
  • State pension will rise by £3.35 to £119.30 per week
  • Savings credit to be frozen at current levels
  • Small business rate relief scheme extended for a further year

Devolution

  • More devolution to be introduced, giving more responsibility to a greater number of local councils.
  • 26 new or extended enterprise zones to be created, 15 in towns and rural areas
  • Councils to keep 100% of receipts from asset sales
  • Welsh block grant to reach £15bn in 2019/20
  • Scottish block grant to be over £30bn in 2019/20

Housing

  • Housing budget to be doubled
  • Help to buy shared ownership introduced
  • Housing supply to be increased via easier planning rules and making more land available for building new homes
  • ‘London help to buy’ to be introduced
  • New rates of stamp duty (3% higher from April 2016) for buy to lets and second homes

Education

  • £23bn to be invested in school buildings and new school places
  • Current national base rate for 16-19 year olds maintained
  • Apprenticeship funding to increase
  • Financial support for education, including higher education loans, to increase by £10bn

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