A Post-Covid Age of Optimism? – The Government Budget, Autumn 2021

On 27th October 2021 the Chancellor of the Exchequer, Rishi Sunak, announced the Autumn 2021 Budget in the House of Commons.

Since the last financial review in March 2021, most of coronavirus restrictions have lifted, as well as most of the pandemic-related economic support. And so it was expected that announced plans would be seen to move the economy beyond the pandemic.

Below are some highlights from The Chancellor’s announcement:

DCMS funding
It was announced there would be an investment of over £850 Million to the Department of Digital Culture Media and Sport (DCMS) spread across the next few years for cultural and heritage infrastructure, designed to protect national treasures and boost culture in local communities and on high streets.
There would also be an additional £14 Million each year for the next few years to support the UK’s creative industries. This would include Small and Medium Enterprises (SMEs) allowing them to grow in size and providing personalised support for the nation’s independent film and video game industries.
The £800 million Events Reinsurance Scheme was also confirmed, as well as an extension to the £½ Billion Film & TV Production Restart Scheme to allow UK events and productions to thrive and plan with certainty.

“Levelling Up”
In the lead up to the Autumn Budget, there had been a lot of announcements relating to the Levelling Up Agenda, part of which was designed to encourage local authorities to update and improve the delivery of skills and employment support in their areas, and so offer the opportunity to boost local social and economic recoveries.
The Chancellor announced over £2½ Billion would be given to the UK Shared Prosperity Fund over the next few years, aimed at helping people into jobs.

The Chancellor also confirmed that the UK Shared Prosperity Fund will aim to match the size of European Union (EU) funding previously received by the UK, and that over £10 Billion would be made available in Overseas Development Assistance, as well as over £450 Million for asylum and refugee support (to be delivered by 2025).

Community Assets
It was announced that over 20 projects around the UK were to benefit from the £150 Million Community Ownership Fund, designed to help communities protect and manage their local assets and landmarks, such as pubs or Post Offices.

Business and Tax
Even though there was no mention about the Community Renewal Fund (created to support people and communities in most need across the UK) The Chancellor did confirm the Recovery Loan Scheme will be extended until the end of June 2022.
The Chancellor also announced that Business rates are to be reduced by 50%, and that there would be further tax reliefs for cultural venues, museums and galleries.

Health and Social Care
The Chancellor announced that spending for the Department of Health and Social Care (DHSC) and the core NHS will rise over the next three years, with NHS funding increasing to £162.6 Billion, said to be a growth of 3.8%.
It was also announced that there will be over £9½ Billion for COVID-19 funding over the next few years, for the health service to be able to respond to the pandemic, as well as an average of £8.7 Billion each year is to be provided through the Barnett formula to devolved nations (although it was not made clear as to how much of this will go to health services).

Youth Services
It was announced over £½ Billion will be provided to youth services in England. This included funding for the Government’s commitment to a Youth Investment Fund, aimed at delivering up to 300 youth facilities in areas most in need.

From the beginning of April 2022, the National Living Wage will be increased from £8.91 to £9.50 an hour.
The Chancellor also announced by December 2021, the amount of Universal Credit (UC) withdrawn for every pound someone earns (also known as the Taper Rate) will be cut from 63p to 55p.

Although this budget and spending review looked forward, aiming to hail a “new age of optimism” and set the path for the Government’s economic policies over the rest of the parliament, it felt overshadowed by concerns about labour demands and supply shortages, the rise in prices and the cost of living. This again was lightly touched on within the sentiment from the Charity sector.

Richard Bray, the Chair for the Charity Tax Group (CTG) advised the Government needed to do more to recognise the role of Charity Sector within community, and that the tax system needs positive change to support the work of charities.

Samantha Mercadante, Policy Manager at the National Council for Voluntary Organisations (NCVO), commented that although they welcomed the commitments made in the budget, the announcements made would not be enough to support charities and communities to recover from the pandemic and build a stronger society.

Imran Hussain, Director of Policy & Campaigns for national charity Action for Children, reflected that the Government must also choose to prioritise children if they plan to “Build Back Better”.

Caron Bradshaw OBE, Chief Executive of Charity Finance Group (CFG), suggested the Budget could be seen as “Good, Bad and Ugly” as while there were some welcome statements, other announcements would do little to reduce the fears of the most vulnerable, and those who face the rising costs of living.

To view The Chancellor’s official 2021 Budget speech in full, or for more information, Visit the Government website.

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