Chancellor Jeremy Hunt has unveiled his Spring Budget amid a cost-of-living crisis.
In it, she covers everything from energy caps to childcare – and you might find out what her plans mean for you.
Baby care
Priority is given to child care. Hunt announced that the policy, which will be phased in, will provide 30 hours of free care a week for children aged nine months to four years.
“By extending 30 hours of free childcare for one- and two-year-olds in England, it closes the support gap at the end of parental leave and gets economically inactive people back into work,” said Victor Trokoudes, co-founder and CEO of smart money app Plum.
“We have been talking for some time about the economic growth benefits of better childcare, so we are delighted that this has been recognized by the Treasury.
“The impact on the economy could be enormous: helping to reduce inflation, freeing up labor markets and providing a much-needed boost to productivity and optimism about the country’s future.
“For women in particular, today’s announcement could be a game-changer, as the single most important factor helping mothers stay in the labor market is free part-time childcare.”
Energy
There’s good news for those struggling with high energy bills on a budget.
“Millions of people in the UK will be relieved at the news that their energy price guarantee has been extended for another three months,” said Sarah Pennells, consumer finance specialist at Royal London.
“The Chancellor’s announcement means that energy bills paid by direct debit for households using typical gas and electricity will be capped at £2,500 a year, instead of the £3,000 planned to start on 1 April.
“Without the government’s energy price guarantee, a typical household would face energy bills of £3,280 a year, which is the current energy price cap from energy regulator Ofgem,” he explains.
So at least you know what to budget for energy heading into the warmer months.
In addition, the often expensive prepaid meters change.
“There has long been criticism that some poor families have to pay more for their energy through pre-payment meters,” says Pennells.
Ofgem has agreed to temporarily halt the forced installation of prepaid meters by suppliers and Hunt said it would “bring their charges in line with comparable direct debit payments”.
Fuel
Last year, after fuel prices skyrocketed and shortages became widespread, drivers lost hope.
In the Budget, Hunt said: “As inflation remains high, I have decided that now is not the right time to raise fuel tax by inflation or increase duty.
“Here’s what I’m going to do: for another 12 months I’m going to keep the 5p cut and I’m also going to stop fuel tax. This will save the average driver around £100 and around £200 next year since the 5p cut was introduced.”
Motorists may also be pleased to hear a £200m boost to the pothole repair fund has been promised.
Alcohol
If the price of a pint in pubs has you wondering, Hunt is promising a change.
“Today I will do what was impossible when I was in the EU and significantly increase the generosity of Draft Relief so that, from August 1, duty on pubs will be up to 11p lower than supermarket duty. the differential we will retain as part of the new Brexit pub guarantees.
“British ale may be warm, but duty per pint is frozen,” he said.
Free time
Love to swim but worried that your local leisure center is having trouble? Changes in the cost of energy should provide some security for the future of local facilities.
In response to the high costs, Mr Hunt said he would provide a £63m fund to “keep our community leisure centers and pools going” and £100m to support thousands of charities and community organisations.
Pensions
Hunt introduced measures to allow people to work longer hours.
“No one can be excluded from the labor force for tax reasons. So today I’m increasing the pension’s tax-free annual allowance by 50% from £40,000 to £60,000,” he said.
However, Karen Bennett CBE, chief executive of Enterprise Credit Union, suggests it may not make much of a difference to low-paid workers.
“We recognize that an increase in the amount that workers can save in their pension savings before paying extra tax may be beneficial for some people, but what does it mean for the average person, those who are already struggling? Where will we get the funds to increase the pension fund?”. he asks.
