Speaking in the House of Commons he said, ‘Universal Credit is here to stay, and we are putting in the funding to make it a success. Because we believe that work should always pay.
‘The switch to Universal Credit is a long overdue and necessary reform.’
However, he said he recognised concerns about the implementation of the programme and about the rates and allowances, announcing an increase to work allowances – the amount people can earn before they start to lose money, and more funding for the roll-out of the system.
The Chancellor also announced increases to the national living wage and the rate at which people start paying income tax.
For schools, he revealed a £400 million one-off fund to pay for ‘extras’, money which unions have called ‘a drop in the ocean’.
The following package of measures was announced:
- An increase to work allowances (the amount someone can earn before they start losing money) on Universal Credit to be increased by £1.7 billion.
- 2.4 million working families and people with disabilities are set to benefit by £630 a year.
- An extra £1 billion over five years to aid the transition to Universal Credit.
Education and health/social care
- A one-off £400 million bonus for schools to ‘buy the little extras they need’. Primary schools will receive an average of £10,000 each and secondaries £50,000 each.
- An extra £2 billion for mental health services – including children and young people’s crisis teams in every part of the country and a 24-hour mental health hotline.
- A total of £650 million for social care next year. As part of this successful children’s social care programmes will be expanded to a further 20 councils with high or rising numbers of children in care.
Tax and wages
- The personal allowance threshold, the rate at which people start paying tax, is to rise from £11,850 to £12,500 in April – a year earlier than planned. This means a basic rate tax payer will pay £1,205 less tax in 2019-20 than in 2010-11.
- The higher rate income tax threshold to rise from £46,350 to £50,000 in April.
- National living wage to increase from £7.83 to £8.21 an hour from April 2019.
- Small employers will pay half of the contribution they currently make for apprenticeship training – down from 10 per cent to 5 per cent.
- To help retailers struggling with the high fixed costs of business rates, business rates will be cut by a third over two years for shops with a rateable value of £51,000 or less, but there are no similar measures for nurseries.
- From April, large businesses will be able to invest up to 25 per cent of their apprenticeship levy to support apprentices in their supply chain.
- New 100 per cent mandatory business rates relief for all public lavatories.
For more information on the packages of support announced in the Budget 2018 click here