While the chancellor was clear in the Budget that the impacts of COVID-19 will be felt for some time, he was also keen to suggest that this Budget focuses on the post-pandemic economic recovery
He said forecasts from the Office for Budget Responsibility (OBR) show the economy will grow by 6.5% this year, with the start of 2022 being slated for a return to its pre-pandemic size. It’s a better prediction from the OBR than the Treasury was expecting, allowing for some additional optimism to work its way into spending decisions.
As usual, we’ve worked our way through the Treasury’s Red Book (so you don’t have to!) to find out what’s relevant for our sector.
Employment and staffing
The Treasury’s pre-briefing of the wage measures in the Budget was not well-received by the speaker of the house of commons, but the measures themselves are likely to be vote-winners.
The National Living Wage (NLW) and National Minimum Wage (NMW) will increase.
NLW (the minimum wage for people 23 and over) will increase from £8.91 to £9.50 per hour from April 2022
NMW The minimum wage for people 22 and under) will also increase in April 2022:
For 21 and 22 year olds from £8.30 to £9.18
For 18-20 year olds from £6.56 to £6.83
For 16 and 17 year olds from £4.62 to £4.81
For apprentices from £4.30 to £4.81
Skills & training
Total spending on skills will increase over the parliament; by £3.8bn by 2024-25. The increase reflects the Treasury’s belief in the relationship between improving skills and improving productivity.
Extend the Kickstart Scheme to March 2022
Quadruple the number of places on Skills Bootcamps
Expand the Lifetime Skills Guarantee on free Level 3 qualifications
Invest £10 million a year in the Sector Based Work Academy Programme
Add extra classroom hours for up to 1000,000 T-Level students
Open 20 Institutes of Technology
Improve post-16 education venues, including more specialist equipment and facilities for T-Levels
Set up a new numeracy programme for adults, which will be called Multiply
Apprenticeships
The Budget’s Red Book cites the delivery of ‘apprenticeship system improvements for all employers.’ These include:
An enhanced recruitment service by May 2022 for SMEs helping them hire new apprentices
Supporting flexible apprenticeship training models to ensure that apprenticeship training continues to meet the needs of employers
By April 2022, considering changes to the provider payment profiles aimed at giving employers more choice over how the apprenticeship training is delivered, and explore the streamlining of existing additional employer support payments so that they go directly to employers
Introducing a return on investment tool in October 2022 to ensure employers can see the benefits apprentices create in their business
Extending the 3k apprentice hiring incentive for employers until 31 January 2022
Business support & finance
Quite a business-based Budget, with the results of the Treasury’s 2020 consultation on business rates finally seeing the light. We’ll bring you more of the detail on business rates over the coming days.
Business rates
Make business rates fairer and timelier, reviewing them every three years
Introduce a business rates improvement relief, allowing businesses to make property improvements and pay no extra business rates for 12 months
Next years’ planned increase in the multiplier will be cancelled
A new 50% business rates discount for businesses in the retail, leisure and hospitality sector, up to £110,000
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