'There was little or no help for local government'

MP for Ellesmere Port

THE grim news Autumn Statement has now been delivered by the Chancellor of the Exchequer to the House of Commons.

Much of the doom and gloom announcements by Jeremy Hunt MP – which in theory are supposed to be reported to Parliament first – had already been leaked to the media in advance.

In his statement the Chancellor said the Government would now give itself five years to hit its debt and spending targets, instead of three years as previously planned. He did so by announcing tax rises and spending cuts worth billions of pounds.

Jeremy Hunt said income tax personal allowance and higher rate thresholds, as well as the main National Insurance and inheritance tax thresholds, would be frozen for a further two years, until April 2028. This means everyone will be paying more income tax over the coming years.

He also announced the top 45% additional rate of income tax will be paid on earnings over £125,140, instead of £150,000 and that the tax-free allowances for dividend and capital gains tax would be cut next year and in 2024.

There will be an increase in the windfall tax on the profits of oil and gas firms from 25% to 35%, extended until March 2028. It also set out plans for a new temporary 45% tax on companies that generate electricity, to apply from January.

Scheduled public spending will be maintained until 2025, but then grow more slowly than previously expected. This is bad news for services such as justice, policing and local government, which have not had their budgets protected as they will see real-terms cuts after 2025.

Indeed it was no surprise at all, there was little or no help for local government, again pushing the burden of financing local services onto already hard-pressed councils in England whose leaders will now be able to increase council tax payments by up to five per cent without a local vote.

There will be a minimum wage increase and a 10.1% rise in State pension payments and means-tested and disability benefits.

Household energy price cap will be extended for one year beyond April but made less generous, with typical bills capped at £3,000 a year instead of £2,500, and with targeted measures for pensioners and those on means-tested and disability benefits.

My reaction to the Autumn Statement: Britain is a great country, with so much potential, which is being held back by the Government’s mismanagement of the economy.

It is working people who are paying the price for this economic failure. Frozen tax thresholds and double-digit inflation will see the real value of people’s wages eroded. It is estimated that people will be 7% worse off as a result of this budget; the largest drop in living standards on record.

The Chancellor has chosen not to take action on non-doms – people who live in this country but do not pay their taxes here – or tax breaks for private equity fund managers earning millions and oil and gas companies making record profits.

We need a fairer, greener and more dynamic economy, creating jobs across the country in renewables, nuclear power and insulating homes.

And we need the Government to fix business rates so our high streets thrive again and putting skills at the heart of our plan for growth.