Budget 2023 live: Jeremy Hunt announces reforms to childcare, pensions and disability benefits | Politics
Key events
Starmer ends his response by saying this is just sticking plaster politics. After 13 years of no growth, people are entitled to ask if they are better off than they were before. The answer is no, he says.
Starmer says only permanent tax cut in budget ‘is for richest 1%’
Starmer says the government was right to look at a solution to the pensions problem that means some well-paid doctors are retiring early.
But he says the pensions tax allowance announcement is “a huge giveaway” to some of the wealthiest people in the country. He goes on:
The only permanent tax cut in the budget is for the richest 1% How could that possibly be a priority?
Starmer accuses Hunt of lifting ideas from Labour.
He says of course Labour welcomes more spending on childcare.
As Tory MPs jeer, he tells them they were not listening when Hunt explained how long it would take to implement.
Starmer makes a joke about the petrol station photocall that Rishi Sunak staged when he was chancellor, telling Jeremy Hunt that he should use his own car – and know how to use a debit card – when he promotes the budget.
And he says he looks forward to promoting the swimming pool policy. “At least he won’t have to borrow one of them.”
OBR: the economic outlook has brightened somewhat
As soon as the chancellor sat down, the Office for Budget Responsibility released its new assessment of the UK economy.
The fiscal watchdog confirms that the economic and fiscal outlook has “brightened somewhat” since its previous forecast in November.
The near-term economic downturn is set to be shorter and shallower; medium-term output to be higher; and the budget deficit and public debt to be lower.
But this reverses only part of the costs of the energy crisis, which are being felt on top of larger costs from the pandemic. And persistent supply-side challenges continue to weigh on future growth prospects.
The OBR says that Hunt has spent two-thirds of the improvement in the fiscal outlook on today’s budget measures, such as maintaining the energy price guarantee at £2,500 a year and on supporting business investment in the near term, “while boosting labour supply in the medium term”.
The OBR adds:
This lowers inflation this year and, more significantly, sustainably raises employment and output in the medium term.
Starmer accuses Tories of ‘dressing up stagnation as stability’ in budget response
Keir Starmer is responding to Hunt now. One of the budget traditions is that the leader of the opposition replies, not the shadow chancellor.
Starmer says this is supposed to be a budget for growth – but the figures show the economy is set to contract.
The UK “is on a path of managed decline”, and falling behind its competitors, he says.
He says the Tory cupboard is as bad as the salad aisle. The lettuce might be out, but the turnips are in.
He says the Tories are “a divided party caught between a rock of decline and a hard place of their own economic recklessness, dressing up stagnation as stability as their expiry date looms ever closer”.
Hunt says free childcare offer from age of nine months will cut childcare costs for families by nearly 60%
Hunt ends with a final childcare announcement.
He says the government will offer 30 hours of free childcare for every child from the age of nine months, where all adults in the household work.
He says this will reduce childcare costs for families by nearly 60%.
Hunt says he wants schools to offer wraparound care from 8am to 6pm by 2026
Hunt says he wants all schools to be able to offer wrap-around care from 8am to 6pm, either on their own or in partnership with other schools. He says the ambition is to have this in place by September 2026.
Hunt is now addressing childcare.
Childminders are a vital way to deliver affordable & flexible care.
To encourage more people to join the profession, new joiners will receive incentive payments of £600, rising to £1,200 for those joining through an agency. pic.twitter.com/WgpFyLETJh
— HM Treasury (@hmtreasury) March 15, 2023
Hunt says he will increase funding paid to nurseries, by £204m from this September, and rising to £288m next year. That is a 30% increase, which is what the sector, wanted, he says.
To support parents on Universal Credit move into work or increase their hours, we’re increasing the amount of UC support for childcare costs by almost 50% & will pay this upfront instead of in arrears.
Families will now be able to claim £951 for 1 child & £1,630 for 2 children. pic.twitter.com/QvSts5FOXs
— HM Treasury (@hmtreasury) March 15, 2023
Hunt says he will abolish lifetime allowance for tax-free pensions savings, and raise annual allowance to £60,000
Hunt says he is going to increase the annual pensions tax free allowance from £40,000 to £60,000.
And he says instead of just lifting the lifetime allowance (currently just over £1m), he will abolish it.
That’s an unexpected rabbit out of the budget hat – there were rumours that the pensions lifetime allowance would be raised to £1.8m.
But it’s a rabbit that will benefit high earners – such as doctors, who have long said they have been hit by a pensions trap, partly due to the freezing of the lifetime allowance.
abolishing lifetime allowance for pensions is a whopping gift to high earners (do wonder how much pension anyone ultimately…needs if the suggested £1.8m limit isn’t enough)
— gabyhinsliff (@gabyhinsliff) March 15, 2023
Hunt says he want more older people to return to work – although as someone aged 56, he prefers the term experienced, he says.
Referring to Dame Eleanor Laing, who is in the chair as deputy speaker, he says: “Madam Deputy Speaker I say this not to flatter you but older people are the most skilled and experienced people.”
If that was a joke, it did not seem to work. MPs seem to think he was being rude.
People say Hunt isn’t bold but this age-related gibes are extremely risky
— Giles Wilkes (@Gilesyb) March 15, 2023
Hunt says there will be skills boot camps for people in their 50s.
Hunt says sanctions will be applied more rigorously to people on benefits who refuse to look for work.
But the earnings threshold will be increased, from 15 hours per week to 18 hours.
Hunt says he will allocate £400m for mental health and musculoskeletal support. Occupational health is important to help people back into work.
And he says there will be a £3m pilot to help people with special needs transition into the workplace.
Key events
Starmer ends his response by saying this is just sticking plaster politics. After 13 years of no growth, people are entitled to ask if they are better off than they were before. The answer is no, he says.
Starmer says only permanent tax cut in budget ‘is for richest 1%’
Starmer says the government was right to look at a solution to the pensions problem that means some well-paid doctors are retiring early.
But he says the pensions tax allowance announcement is “a huge giveaway” to some of the wealthiest people in the country. He goes on:
The only permanent tax cut in the budget is for the richest 1% How could that possibly be a priority?
Starmer accuses Hunt of lifting ideas from Labour.
He says of course Labour welcomes more spending on childcare.
As Tory MPs jeer, he tells them they were not listening when Hunt explained how long it would take to implement.
Starmer makes a joke about the petrol station photocall that Rishi Sunak staged when he was chancellor, telling Jeremy Hunt that he should use his own car – and know how to use a debit card – when he promotes the budget.
And he says he looks forward to promoting the swimming pool policy. “At least he won’t have to borrow one of them.”
OBR: the economic outlook has brightened somewhat
As soon as the chancellor sat down, the Office for Budget Responsibility released its new assessment of the UK economy.
The fiscal watchdog confirms that the economic and fiscal outlook has “brightened somewhat” since its previous forecast in November.
The near-term economic downturn is set to be shorter and shallower; medium-term output to be higher; and the budget deficit and public debt to be lower.
But this reverses only part of the costs of the energy crisis, which are being felt on top of larger costs from the pandemic. And persistent supply-side challenges continue to weigh on future growth prospects.
The OBR says that Hunt has spent two-thirds of the improvement in the fiscal outlook on today’s budget measures, such as maintaining the energy price guarantee at £2,500 a year and on supporting business investment in the near term, “while boosting labour supply in the medium term”.
The OBR adds:
This lowers inflation this year and, more significantly, sustainably raises employment and output in the medium term.
Starmer accuses Tories of ‘dressing up stagnation as stability’ in budget response
Keir Starmer is responding to Hunt now. One of the budget traditions is that the leader of the opposition replies, not the shadow chancellor.
Starmer says this is supposed to be a budget for growth – but the figures show the economy is set to contract.
The UK “is on a path of managed decline”, and falling behind its competitors, he says.
He says the Tory cupboard is as bad as the salad aisle. The lettuce might be out, but the turnips are in.
He says the Tories are “a divided party caught between a rock of decline and a hard place of their own economic recklessness, dressing up stagnation as stability as their expiry date looms ever closer”.
Hunt says free childcare offer from age of nine months will cut childcare costs for families by nearly 60%
Hunt ends with a final childcare announcement.
He says the government will offer 30 hours of free childcare for every child from the age of nine months, where all adults in the household work.
He says this will reduce childcare costs for families by nearly 60%.
Hunt says he wants schools to offer wraparound care from 8am to 6pm by 2026
Hunt says he wants all schools to be able to offer wrap-around care from 8am to 6pm, either on their own or in partnership with other schools. He says the ambition is to have this in place by September 2026.
Hunt is now addressing childcare.
Childminders are a vital way to deliver affordable & flexible care.
To encourage more people to join the profession, new joiners will receive incentive payments of £600, rising to £1,200 for those joining through an agency. pic.twitter.com/WgpFyLETJh
— HM Treasury (@hmtreasury) March 15, 2023
Hunt says he will increase funding paid to nurseries, by £204m from this September, and rising to £288m next year. That is a 30% increase, which is what the sector, wanted, he says.
To support parents on Universal Credit move into work or increase their hours, we’re increasing the amount of UC support for childcare costs by almost 50% & will pay this upfront instead of in arrears.
Families will now be able to claim £951 for 1 child & £1,630 for 2 children. pic.twitter.com/QvSts5FOXs
— HM Treasury (@hmtreasury) March 15, 2023
Hunt says he will abolish lifetime allowance for tax-free pensions savings, and raise annual allowance to £60,000
Hunt says he is going to increase the annual pensions tax free allowance from £40,000 to £60,000.
And he says instead of just lifting the lifetime allowance (currently just over £1m), he will abolish it.
That’s an unexpected rabbit out of the budget hat – there were rumours that the pensions lifetime allowance would be raised to £1.8m.
But it’s a rabbit that will benefit high earners – such as doctors, who have long said they have been hit by a pensions trap, partly due to the freezing of the lifetime allowance.
abolishing lifetime allowance for pensions is a whopping gift to high earners (do wonder how much pension anyone ultimately…needs if the suggested £1.8m limit isn’t enough)
— gabyhinsliff (@gabyhinsliff) March 15, 2023
Hunt says he want more older people to return to work – although as someone aged 56, he prefers the term experienced, he says.
Referring to Dame Eleanor Laing, who is in the chair as deputy speaker, he says: “Madam Deputy Speaker I say this not to flatter you but older people are the most skilled and experienced people.”
If that was a joke, it did not seem to work. MPs seem to think he was being rude.
People say Hunt isn’t bold but this age-related gibes are extremely risky
— Giles Wilkes (@Gilesyb) March 15, 2023
Hunt says there will be skills boot camps for people in their 50s.
Hunt says sanctions will be applied more rigorously to people on benefits who refuse to look for work.
But the earnings threshold will be increased, from 15 hours per week to 18 hours.
Hunt says he will allocate £400m for mental health and musculoskeletal support. Occupational health is important to help people back into work.
And he says there will be a £3m pilot to help people with special needs transition into the workplace.
