Budget 2023 – live updates: Pension lifetime allowance and childcare changes at a glance
OBR forecasts biggest fall in living standards on record as Labour’s Sir Keir Starmer accuses chancellor Jeremy Hunt of ‘permanent tax cut for wealthy’
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Jeremy Hunt has promised a major expansion in state-funded childcare and tax breaks for businesses in Budget measures aimed at boosting economic growth.
The Chancellor said a recession would be avoided and inflation would fall dramatically as the economy was “proving the doubters wrong” in his statement to the Commons on Wednesday.
In an effort to remove barriers to work, he promised up to 30 hours a week of free childcare for eligible households in England with children as young as nine months.
Mr Hunt resisted demands from Tory MPs to scrap April’s increase in corporation tax from 19% to 25%, but he instead promised a set of reliefs to help firms reduce their bills.
And as part of a package aimed at helping with the cost of living, the Chancellor said the energy price guarantee will be extended at its current level from April to June.
However, fiscal watchdog the Office for Budget Responsibility forecast the biggest fall in living standards on record.
The OBR upgraded its growth forecast for 2024 from 1.3% to 1.8%, but downgraded predictions for the following years to 2.5% in 2025, 2.1% in 2026 and 1.9% in 2027.
Households ‘not out of the woods’ despite energy price guarantee extension
Households are still facing a £67-a-month energy bill increase from April despite the “welcome” extension to the energy price guarantee at its current rate until the summer.
Ahead of his Budget speech, chancellor Jeremy Hunt confirmed that the EPG, which limits a typical household energy bill to £2,500, will be extended for another three months.
It had been due to increase to £3,000 in April to reduce the burden on state finances.
However, consumers still face having to find an extra £67 a month to pay their energy bills from April when the government’s separate Energy Bill Support Scheme - which has seen all households receive six monthly payments of £66 or £67 direct to their energy accounts - comes to an end.
Citizens Advice chief executive Dame Clare Moriarty said the “welcome step” of extending the existing EPG would protect millions of people from unaffordable energy bills.
But she added: “Unfortunately it’s not all good news. The withdrawal of the Energy Bill Support Scheme will still mean the average monthly bill rises by £67 from April.
“With millions already unable to afford their bills and energy prices set to remain high in the years ahead, the government must now look at long-term solutions to this problem.
“Many people, especially those on low incomes, will need ongoing support not only to pay their bills but to make their homes safer and warmer through improved energy efficiency.”
Martin Lewis thanks government for extending energy price guarantee
Martin Lewis has thanked the government for extending the energy price guarantee for another three months.
Posting on Twitter, he said: “The Energy Price Guarantee 20% rise has been postponed from April to July - meaning in practice it’s cancelled. Exactly what my letter (below) to Chancellor asked for. Thanks to the govt for listening & to the 135 charities backing the campaign.”
Swimming pools group appeals to Scottish government for cash to stay afloat
Leisure bosses are calling on the Scottish Government to follow the chancellor’s lead and extend “vital” help for swimming pools.
Community Leisure UK (CLUK), which represents charitable trusts operating swimming pools, warned money is desperately needed to deal with rapidly rising energy costs and other bills.
Amid fears some pools may be forced to close, CLUK said if chancellor Jeremy Hunt uses his Budget to provide financial aid south of the border, the Scottish Government must do the same.
Mr Hunt is expected to promise a £40 million one-year fund to make pools more energy efficient in the long-term, along with £23 million in cash grants to leisure centres with pools facing immediate cost pressures.
While this cash will not be available to pools in Scotland, additional money will come to the Scottish Government through the Barnett formula.
Robin Strang, chair of CLUK in Scotland, said it is “vital” Holyrood ministers follow Mr Hunt’s lead with financial aid.
He warned: “The impact of rising energy costs on swimming pools across Scotland is intensifying - and that pressure is only going to become greater.
“Operators of community swimming pools will face stark choices, including closures and service reductions, unless we can channel every ounce of financial help available to them.
“While we are still seeking greater action from the UK Government in terms of relief on energy bills, it’s vital that the Scottish government ensures the knock-on impact of the Chancellor’s announcement are made available to our sector.”
Watch: Jeremy Hunt presents red box outside Downing Street ahead of 2023 Budget
Government asks National Grid to keep coal plants on standby for next year
The government has asked National Grid to ensure that the coal power plants that have been on standby in case of a supply crunch this winter will remain available next year as well.
The coal plants were meant to be retired last year, but amid pressure on energy markets the government and the Electricity System Operator kept them as a backup power source.
So far the plants, run by Drax and EDF, have only been used once this winter, earlier this month when temperatures plummeted.
Who will be eligible for extended free childcare and when will it start?
Chancellor Jeremy Hunt is set to use a “Budget for growth” to boost efforts to get people back to work, with a major expansion of childcare support set to form a key part of the package.
Reports of a multibillion-pound expansion of free childcare for one and two-year-olds received a tentative welcome on Tuesday, as parents and nurseries awaited the full details from the chancellor.
The plan is believed to include 30 hours a week of childcare for parents in England with one and two-year-olds, building significantly on the current provision.
Thomas Kingsley reports:
Who will be eligible for extended free childcare and when will it start?
Parents have already described the move as ‘life-changing’
What time is the Budget statement?
Jeremy Hunt will unveil his first Spring Budget since becoming chancellor today at 12.30pm, following Prime Minister’s Questions.
The Budget is set to introduce 12 new low-tax “investment zones” in a bid to kickstart the UK’s stalling economy and help “level up” areas outside of London. The chancellor is also understood to be ready to increase the tax-free allowance for pensions to encourage those who returned early to bolster the UK’s workforce.
The financial announcement comes as the International Monetary Fund (IMF) has warned the UK’s economy is likely to perform worst of any G7 nation this year.
Where can I watch the Budget live?
Chancellor of the Exchequer Jeremy Hunt is contending with rocketing inflation, mass industrial action and a cost-of-living crisis
Watch live: Rishi Sunak faces Keir Starmer in PMQs ahead of 2023 Budget
Rishi Sunak faces Sir Keir Starmer at PMQs ahead of Jeremy Hunt’s spring Budget today.
The pair will face off at the Dispatch Box before the chancellor delivers a much-anticipated statement in the House of Commons detailing his economic policy announcements.
Ahead of Mr Hunt’s official speech, the Treasury said that the energy price guarantee will be extended for three months beyond April.
Live: Rishi Sunak faces Keir Starmer in PMQs ahead of 2023 Budget
Rishi Sunak faces Sir Keir Starmer at PMQs ahead of Jeremy Hunt's spring Budget on Wednesday (15 March).The pair will face off at the Dispatch Box before the...
New mother says chancellor’s expected reform to childcare ‘changes everything’
The mother of an eight-month-old baby has said the Government’s expected announcement to extend funded childcare for one and two-year-olds “changes everything” as the plans will allow her to return to work full-time.
Natalie Godfrey, a beauty therapist based in Bournemouth, said, while her son does not yet qualify for the funded childcare, she will be able to work full-time again come July if it goes ahead.
“It will make a huge difference to me (if) I do get the funding,” the 35-year-old told the PA news agency.
“I will be going back part-time, 22 hours (a week) but if I can build up my work column, I can work more hours when my baby turns one.
“I can’t afford the £70 per day fee... Many mums can’t go back to work after mat leave as the costs are too high - this changes everything and I for one am feeling very relieved that this will now enable me to get back to work.
“I think this is a very overdue step forward to help mums get back to work and be able to earn money rather than work to pay for childcare... It gives mums the freedom and flexibility with working hours and will help boost the economy.”
PM says issues between Lineker and BBC are ‘between them'
Rishi Sunak has said issues between Gary Lineker and the BBC are “between them” and he looks forward to watching Match of the Day again.
Leader of the opposition Keir Starmer has said the prime minister should “stand up to his snowflake MPs” and stop “waging war on free speech”.
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