How your finances will be affected

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Male singleton

Boy racers (and sensible motorists) will have cheered at the freezing of January's planned 3p fuel duty rise, especially as current pump prices are close to a record high. The saving to a young driver could be substantial.

But if he's been saving up to buy a home, he may want to shift after the Chancellor failed to extend the stamp duty holiday for first-time buyers on properties under £250,000 beyond next March.

As Paul Smee of the Council of Mortgage lenders said: "It is likely that we will see a bunching of eligible first-time buyer transactions early next March to beat the expiry date on the concession."

Young men are likely to be the biggest hit by the bringing forward by a decade to 2026 of the rise in the state pension age to 67. If the Government continues its current policy, anyone born after 1988 will have to work until age 71, according to the number-crunchers at Standard Life.

Female singleton

For the next few years at least, Britain doesn't look like a good place to be young and a woman, particularly if you work, as a disproportionately large number do, in the public sector. Job losses here are now predicted to top 700,000 while the prospects of getting on the property ladder look dimmer than ever.

This is despite last week's announcement that some first-time buyer mortgages would be underwritten by the taxpayer. The ending of the stamp duty holiday for first-time buyers also sparked criticism from property industry watchers.

Adrian Coles, director general of the Building Societies Association, accused the Government of "giving with one hand but taking away with the other". Social tenants looking to buy their own homes can expect discounts of up to 50 per cent – but this may choke off the supply of social housing in the long term.

Poor nuclear family

The snatching away of the planned extra increase of £110 in child tax credits will hit the nation's poorest families hard. The Government's own analysis shows that a further 100,000 children will be pushed into poverty as a result of the tax and benefits changes, according to Barnardo's.

However, families with toddlers will have been cheered by news that the Government is doubling its offer of 15 hours of free childcare a week for the most deprived two-year-olds in England. Some 40 per cent of the UK's two-year-olds will be covered by the scheme.

The withdrawal of the stamp duty concession from next spring will hit those hoping to buy their first home, but the scrapping of the 3p increase on fuel from January will be of help, especially as the average household spends £1 out of every £8 on motoring, according to the RAC.

Middle-income nuclear family

Britain's baby boomers are directly affected by plans to move forward increases in the state pension age from 66 to 67 by almost a decade. Anyone born between 6 April 1961 and 5 April 1968 will now have to work an extra year. They could also be hit by the reversal of the promised rise in the child element of the child tax credit.

But they are likely to benefit most from the scrapping of January's planned 3p increase in fuel prices, with most middle-income families having at least two cars.

The estimated 10 per cent hike in the rate of Air Passenger Duty will also hit family holidays. That could increase the cost of a trip to the US for a family of four by around £50. A further announcement about the tax will be made on 6 December, which could bring further bad news.

Rich nuclear family

Richer families may be alarmed at the freezing of the annual capital gains tax exempt amount for all other investors at £10,600 for another year. But investors have been given a very tempting tax incentive to back start-up businesses, with the 50 per cent tax relief for up to £100,000 invested in the new Seed Enterprise Investment Schemes. On top of that, any gains realised from investments in 2012-13 will be made exempt from capital gains tax if they are reinvested in a SEIS in that same tax year.

"The Chancellor has increased the opportunities for wealthy individuals to manage their tax costs through a wider range of tax-efficient investments," pointed out Ray McCann, director of McGrigors Tax. "However, the limits on the amount of SEIS investment may disappoint some."

Pensioner couple

If there are any winners from the Autumn Statement it's those already retired. The Chancellor confirmed that the basic state pension for couples will rise by 5.2 per cent, the rate of the retail price index in September. This means that a pensioner couple in receipt of the full state pension can expect to see it rise by £8.50 to £171.85.

This means that the Government is sticking to its "triple lock" on the state pension – that it will always increase the state pension by prices, earnings or 2.5 per cent, whichever is greater.

The pension credit, which is meant to supplement the income of poorer pensioners, will rise for couples in April by 3.9 per cent to £217.90 a week. "It's very good to see that the Government did not let pensioners down. Pension credit will also be uprated by more than earnings. This is at last better news for pensioners with the honouring of the triple lock," said Ros Altmann, director general of Saga.

Single pensioner

The basic state pension for a single person will rise from £102.15 to £107.45, an increase of 5.2 per cent, based on the September rate of inflation. According to the Chancellor, this equates to "the largest ever cash rise in the basic state pension and a commitment of fairness to those who have worked hard all their lives".

There will also be a rise in the pension credit – which tops up the incomes of some of the country's poorest retired – by 3.9 per cent in April 2012, to £142.70 per week for single pensioners. However, as Martin Lewis, founder of the MoneySavingExpert website, points out: "Pension credit is being uprated, but millions of eligible pensioners don't claim what they're entitled to. That needs to be fixed."

Figures from Age UK show that up to a third of those eligible to claim pension credit or council tax benefits do not do so. Like a pensioner couple, the single retired person is likely to continue to suffer from a poor return on their savings.


The number of unemployed in the UK is set to rise dramatically over the next couple of years. The Office for Budget Responsibility now reckons the percentage of the workforce unemployed will rise to 8.7 per cent next year – an extra 250,000. The pain is set to be felt most in the public sector, with further spending cuts planned for 2014 and 2015. The small print of the Autumn Statement revealed that total job losses could top 700,000.

On the benefits front, there was better news for the unemployed. Despite fears that the Government could freeze the level of Jobseeker's Allowance, it was announced that working age benefits will go up in line with the September inflation rate of 5.2 per cent. Extra spending on infrastructure and moves to ease business lending are also expected to help people find jobs, but much of the benefit won't be seen until 2013 at the earliest – scant consolation to those without a job now.