Rishi Sunak discusses the Spring Budget
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This year’s Budget is sure to make the history books as it comes in the middle of a global pandemic and a huge economic fallout. This year’s Budget will be delivered on Wednesday, March 3, and it usually starts at 12.30pm, straight after the Prime Minister’s Questions in the House of Commons. The speech usually lasts an hour and lays out Chancellor Rishi Sunak’s financial plans for the upcoming year. The Treasury has already said this year’s “Budget will set out the next phase of the plan to tackle the virus and protect jobs”, but has so far remained tight-lipped about what this could actually entail.
Speaking to Express.co.uk, James Foster the Senior Commercial Manager at SJD Accountancy said he expects plans for employment to be at the core of this year’s announcement.
Mr Foster said: “The need to rebalance the public finances in the wake of this pandemic is something the Chancellor has already made clear reference to.
“But the indications so far are that this Budget will not be one that sees wide-ranging taxes announced.
“Protecting jobs will be a key theme and I think we can expect to see an extension to the business support schemes – the CJRS (Coronavirus Job Retention Scheme, or furlough) and SEISS (Self-Employed Income Support Scheme).”
The latest financial figures for the UK are quite concerning.
Government borrowing for this year has now reached a staggering £270.8billion, which is a massive £212.7billion more than a year ago, according to the Office for National Statistics (ONS).
This borrowing has pushed up the national debt to £2.13trillion, which is the equivalent of 99.4 percent of Gross Domestic Product (GDP).
The astronomically high debt hasn’t been seen in Britain since the early 1960s and doesn’t bode well for the future.
In terms of unemployment, things aren’t looking too great in this area either.
The rate of people out of jobs is expected to spiral in 2021, one the furlough scheme closes for good and is one of the biggest challenges facing the Government.
The support has to end at some point, but timing it to decrease the number of people left in the dark will be a crucial goal for this year.
The Office for Budgetary Responsibility (OBR) estimates the unemployment rate to peak at about 7.5 percent in the middle of 2021, representing about 2.6 million Brits out of work – up from four percent pre-pandemic.
However, this forecast was made before the third and current lockdown, which means projections from where we are now are likely to be much, much worse.
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In terms of what the support could look like for people unable to work going forward, Mr Foster said that is one thing that is still unclear.
He explained: “More details on the furlough scheme are expected to be announced on March 3 before the Budget, but it’s not clear what that will entail.
“The previous mechanism that saw support laddered down from 80 percent in August to 70 percent in September and 60 percent in October is one possibility.
“We could also see the idea of the Job Support Scheme revived, which was initially due to come into play in November 2020.
“However, support for this scheme was not as strong as the Government had hopes, so it’s possible that the Chancellor will have moved away from this idea completely.”
A fourth SEISS grant is also an “expectation” and will likely work on “similar terms” according to the financial expert, but again, we won’t know more until the Budget.
For another group which have been left out, freelancers, there could be some additional support included in the announcement.
Mr Foster concluded: “There has also been a big push from those within the UK’s contracting and freelancer community to see some kind of financial support made available to them, with so many having fallen through the cracks since the pandemic first began.
“The proposal on the table for a new Directors Income Support Scheme (DISS) is very credible and we hope the Government has given it the attention it deserves.”
More is likely to be announced over the coming weeks, with all details expected to be revealed in the Budget next month.
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