BUDGET 2021 AT A GLANCE

1) More benefits for working people on low pay

The Chancellor announced changes to Universal Credit, which is paid to many working people on lower salaries.

At the moment, people lose 63p in benefits for every £1 they earn. But this will be cut to 55p.

In practice, it means people will get more benefits. And the Chancellor said many working people would be more than £1,000-a-year better off.

Mr Sunak also admitted taxes are higher than at any time since the 1950s, but said he didn’t apologise because this was a result of action he took to help people during the pandemic.

But he said there would now be a shift in approach, with a move away from the idea government could solve every problem.

2) Creating “family hubs” - following the closure of the Sure Start programme

There will be £300 in services for families and parents of young children, including funding for a network of “family hubs” across the country.

3) Money for local councils and regional mayors to improve towns and cities

Mr Sunak said he was allocating £1.7bn “to invest in the infrastructure of everyday life in over 100 local areas”. This comes from the Government’s Levelling Up Fund. The fund was announced before, and local areas had to bid for a share of the cash. What is new is that the Chancellor has announced the winning bids, and told areas how much they will get. A typical scheme might involve regenerating a run-down area of a town or city centre.

4) Funding for regional buses and metro

Mr Sunak highlighted £5.7bn going to mayor-led combined authorities for local transport infrastructure.

In the West Midlands, this will help pay for a Black Country extension of the Metro, new bus lanes for Sprint buses in Walsall, Birmingham and Solihull, and electric vehicle charging points.

The Integrated Rail Plan, revealing the Government’s plans for HS2 and Northern Powerhouse Rail, will be published “soon”.

5) Tax boost for regional airports

Flights between UK airports will from April 2023 be subject to a new, lower rate of air passenger duty. Nine million passengers will see their duty cut by half. This will help regional airports such as Birmingham International, because a higher proportion of their passengers are domestic fliers, although critics will say it could encourage people to fly more, hindering efforts to limit climate change.

6)Tax discount for shops & pubs

For one year, there will be a new 50% discount for businesses in the retail, hospitality and music venues. That includes shops, pubs and gyms, who will only pay half their business tax for one year, up to a total discount of £110,000, at a cost of £1.7 billion. The Chancellor said he wanted to help the firms hit hardest during the pandemic.

He also announced reforms to business rates include a new “investment relief”, which means firms pay less tax if they invest in green technology such as solar panels.

7) Cheaper beer

Mr Sunak announced a “radical simplification of alcohol duties”. Liqueurs, and lower strength beers will be taxed less, he said, while some very high-alcohol products such as strong ciders will be taxed more. In addition, there will be a tax cut for craft beer, and for sparkling wines such as Prosecco.

And he said he was backing a campaign led by Dudley South MP Mike Wood and cutting duty on draught beer, a measure that should save pubs £100 million a year. The price of a pint would be cut by 3p, he said.

8) Higher pay

Public sector workers would see “fair and affordable pay rises” over the next three years, he said. Low-paid workers will benefit from increases to the National Living Wage, up to £9.50 an hour. For a full-time worker that’s a pay rise worth more than £1,000, he said.

A planned rise in fuel duty will be cancelled, Mr Sunak said.

9) Money to reduce homelessness

Funding to cut rough sleeping and homelessness will be increased to £640 million-a-year, Mr Sunak said.

10) Inflation is likely to reach 4%

Following a long period of very low inflation in the UK, prices are expected to rise by 4%, meaning higher bills and prices in the shops.

Mr Sunak said there were two reasons for this. One is demand for goods increasing as the economy reopens following the Covid pandemic. And secondly, global demand for energy has surged, “putting a strain on prices”, a problem which he said will “take months to ease”.

11) No return to austerity

Mr Sunak said spending in every government department will increase, even after allowing for the effects of inflation. It follows speculation that he might cut spending, to try to repay the debts the Government built up during the Covid pandemic. NHS funding will increase by £44 billion to £177 billion-a-year. And local government funding will also increase.

12) The economy hasn’t been as damaged by Covid as much as expected

Mr Sunak said Treasury watchdog the Office for Budget Responsibility “now expect our recovery to be quicker”.

The economy is expected to return to its pre-Covid level at the end of the year, and grow by six per cent in 2022.

The unemployment rate is expected to peak at 5.2% – lower than expected, though it still suggests1.7 million people will be unemployed. And wages are rising. Compared to February 2020, wages have risen by almost 3.5% in real terms, Mr Sunak said.