Font Size

Budget and Spending Review October 2021 - What you need to know

 By

HM Treasury - Expert Author

Tax Articles
Submit Articles   Back to Articles

Published 27 October 2021

1. Strong and innovative public services:

The new Health and Social Care Levy, along with an increase to the rates of dividend tax, will raise around £13 billion per year for spending on health and social care across the UK. This enables significant further funding for the NHS, for the government’s reforms to social care, public health and prevention programmes, and investment in training the workforce of the future.

£2.3 billion over the next three years will transform diagnostic services with at least 100 community diagnostic centres across England – helping millions of patients access earlier diagnostic tests closer to home.

£2.1 billion over the next three years to support innovative use of digital technology so hospitals and other care organisations are as connected and efficient as possible, freeing up valuable NHS staff time and ensuring the best care for patients wherever they are.

£1.5 billion over the next three years for new surgical hubs, increased bed capacity and equipment to help elective services recover, including surgeries and other medical procedures.

Confirms an additional £4.7 billion by 2024-25 for the core schools budget in England, over and above the SR19 settlement for schools in 2022-23, as well as £2.6 billion of capital funding for new school places for children with special educational needs and disabilities, and £1.8 billion of additional money for education recovery – in addition to the £1.4 billion announced in June 2021.

Confirms investment of £11.5 billion in the Affordable Homes Programme in England from 2021-26 to help build up to 180,000 new affordable homes – with 65% of funding for homes outside London.

An additional £1.9 billion resource funding for England’s criminal justice system to manage the increased number of offenders being brought to justice and start to reduce backlogs in criminal courts caused by COVID-19 and improve waiting times.

Increasing annual funding for Ministry of Justice’s victims support services to over £185 million a year by 2024/25. £355 million to keep people safe, cut crime and help victims of sexual abuse in England and Wales, including £50 million towards the Safer Streets Fund helping it continue its vital role in working with police forces in local crime-prevention.

2. Supporting people:

Permanently cutting the Universal Credit taper rate by 8% from 63p to 55p, ensuring more money in people’s pockets.

From 1st April 2022 the National Living Wage will increase by 6.6% to £9.50 an hour. Young people and apprentices will also see pay increases as the National Minimum Wage rates will also increase next April. Alcohol duties will be frozen across the board for the third year running saving consumers £3 billion.

Additional investment of £170 million in 2024-25 to increase the hourly rate to be paid to early years providers to deliver the government’s free childcare hours.

New investment of £302 million to fund new programmes to support parents, provide bespoke breast feeding services and parent-infant mental support, and funding to rollout Family Hubs across England.

£639 million resource funding per annum by 2024-25 as part of the government’s commitment to end rough sleeping in England, an 85% cash increase compared to 2019-20. This brings total funding to £1.9 billion resource and £109 million capital investment over the SR21 period, and builds on the government’s achievement of having reduced rough sleeping numbers by a third between 2019 and 2020.

Fuel duty rates will be frozen UK-wide for the 12th consecutive year.

An increase in adult skills funding by 29% in real terms compared to 2019-20 – this funding will go towards a range of policies in England such as continuing the Prime Minister’s Lifetime Skills Guarantee to offer free Level 3 courses for adults, and quadruple the current scale of Skills Bootcamps

£560 million of new funding through the UK Shared Prosperity Fund for the new UK-wide Multiply programme which will support up to half a million adults to improve their numeracy.

New investment of £1.6 billion for 16–19-year olds’ education in England. This will maintain funding in the face of demographic growth and provide additional hours for learners who take T Levels.

Increases apprenticeship funding in England to £2.7 billion in 2024-25 and continue to invest over £900 million for each year of this Spending Review across Great Britain on work coaches to ensure Universal Credit claimants receive the best support to find employment.

Confirms funding for the Restart scheme in England and Wales, to continue providing intensive and tailored support to long-term unemployed people to help them find work

£90 million to extend the Job Entry Targeted Support Scheme to the end of September 2022 - helping those unemployed for between three and twelve months across Great Britain find work.

3. Levelling Up:

Over £2.6 billion for the UK Shared Prosperity Fund over the Spending Review, focused on helping people into jobs and get on in life across the UK.

£560 million new funding for youth services in England over the next three years, enough to fund 300 youth clubs.

£205 million new funding to build or transform up to 8,000 state-of-the-art community football pitches across the UK.

Allocation of the first round of the UK-wide Levelling Up Fund with £1.7 billion of local investment in local areas, ranging from redeveloping Inverness Castle to upgrading the ferry to the Isles of Scilly, and from a bowling green in Portrush to a science lab in Peterborough.

Allocation of the first 21 projects to benefit from the £150 million Community Ownership Fund, which will help communities across the UK protect and manage their most treasured assets, from building the John Jenkins Stadium in Portsmouth to acquiring the Old Town Hall as part of a new museum development in Whithorn in Scotland, supporting the Ty’n Llan pub in Llandwrog in Wales, and developing a new community digital hub in Cushendall in Northern Ireland.

£2.6bn between 2020-2025 for a new, long-term pipeline of over 50 local road upgrades in England and over £5 billion for local roads maintenance, enough to fill millions of potholes a year.

£5.7 billion to eight English city regions over five years to transform local transport networks through London-style integrated settlements.

£3 billion investment over this Parliament to level up bus services in England, including a new dedicated £1.2 billion new funding for London-style bus transformation deals to improve infrastructure, fares and services. #

It also confirms £355 new funding for zero emission buses, and an allocation of £70 million Zero Emission Bus funding to deliver buses and related infrastructure in Warrington, Leicester, Milton Keynes, Kent, and Cambridgeshire & Peterborough.

£850m to protect museums, galleries, libraries, and local culture in England.

4. Investing in growth and supporting businesses:

Increasing public investment in UK R&D to £20 billion by 2024-25, representing an increase of around a quarter in real terms.

Plans to reform R&D tax reliefs to support modern research methods.

Doubling the available scholarships for AI and Data Science Master’s conversion courses with a £23 million investment for under-represented groups.

Supporting private R&D investment by increasing funding for core Innovate UK programmes, reaching circa £1 billion per year by 2024-25, over £300 million more per annum than in 2021-22.

Funding for the UK to become the first country to launch a rocket into orbit from Europe in 2022, with the aim of becoming a leader in commercial small-satellite launch, as set out in the National Space Strategy.

An extension of the temporary £1 million level of the Annual Investment Allowance to March 2023, providing more upfront support to help businesses across the UK to invest and grow.

To reduce the burden of business rates and support investment in England, the government is freezing the business rates multiplier for a further year, a tax cut worth £4.6 billion over five years.

New investment incentives in England totalling almost £750 million, including tax relief for eligible green investments and a new ‘business rates improvement relief’.

A new 50% business rates discount for businesses in the retail, hospitality, and leisure sectors in England. Overall reducing the burden of business rates in England by £7 billion over the next five years, alongside a commitment to modernise the business rates system with more frequent revaluations every three years.

Temporarily increasing the headline rates of tax relief for theatres, museums, orchestras and galleries across the UK from 27 October 2021 to 31 March 2024, increasing the relief organisations can claim as they invest in new productions and exhibitions.

£11 million funding to back the UK and Ireland bid to host the 2030 men’s Football World Cup.

5. Building back greener:

£6.1 billion to back the Transport Decarbonisation Plan, boosting the number of zero emission vehicles, helping to develop greener planes and ships, and encouraging more trips by bus, bicycle and foot.

Up to £1.7 billion of direct government funding to enable a large-scale nuclear project to reach a final investment decision this parliament, subject to value for money and approvals. The government is in active negotiations with EDF over the Sizewell C project.

£380 million for our world-leading offshore wind sector, boosting jobs and investment across the UK including offshore wind ports in Teesside and the Humber

Confirms funding for the £1 billion Net Zero Innovation Portfolio, as announced in the Ten Point Plan, which is accelerating near-to-market low-carbon technology innovations and the aligned £385 million Advanced Nuclear Fund which is developing the next generation of small and advanced modular reactor technologies.

£3.9 billion to decarbonise buildings, including £1.8 billion to support tens of thousands of low-income households to make the transition to net zero while reducing their energy bills.

A further £625 million for the Nature for Climate Fund, ensuring total spend of more than £750 million by 2024-25 will help meet our commitment to plant at least 7,500 hectares of trees every year in England by 2025 and restore 35,000 hectares of peatland during this Parliament.

More than £250 million to protect and restore nature in England in support of the UK’s world-leading target to halt biodiversity decline by 2030.

6. Advancing Global Britain & seizing the opportunities of Brexit:

Modernising the UK’s Tonnage Tax regime to ensure that our shipping industry remains highly competitive in the global market.

The first Freeport tax sites will be in Humber, Teesside and Thames, and those Freeports will be able to begin initial operations from November.

A new UK Global Talent Network, to work with businesses and research institutes to identify and attract the best global talent in key science and tech sectors.

The new £1.4 billion Global Britain Investment Fund will ensure that economic opportunities are spread more evenly across the UK by supporting investment in the UK’s life sciences, offshore wind and automotive manufacturing sectors.

£11 billion of Overseas Development Assistance (ODA) including doubling our international climate finance to £11.6bn between 2021-22 and 2025-26 and £430 million to the Global Partnership for Education to help to educate young people, particularly for girls (our largest ever contribution).

Funding for the UK’s commitment to welcome up to 20,000 Afghan citizens over the coming years, including £20,520 per person for Local Authorities who settle Afghan families, with an additional £17 million available to top-up housing costs and an extra £20 million pot of flexible funding.

An additional £458 million by 2024-25 for asylum and refugee support, helping protect vulnerable people in our asylum system.

£703 million over the next three years to improve the safety, security and efficiency of the UK border.

Confirming eligibility criteria for the new Scale-Up Visa, to help make it quicker and easier for fast-growing businesses to bring in highly-skilled individuals.

A 50% cut in Air Passenger Duty for flights between airports in England, Scotland, Wales and Northern Ireland – which is set to benefit around nine million passengers in 2023-24 and will be delivered via a new domestic band.

A new rate of Air Passenger Duty of £91 on flights of 5,500 miles or more. These reforms apply across the UK except for the direct long-haul rates for Northern Ireland which are devolved.

The alcohol duty system will be overhauled to make it fairer and more straightforward, with drinks taxed in proportion to their alcohol content and duty rules simplified.

7. Delivering for all parts of the UK:

Announcing the first 21 places across the UK to benefit from the £150 million Community Ownership Fund, which will invest at least £12.3 million in Scotland, £7.1 million in Wales, and £4.3 million in Northern Ireland over at least eight bidding rounds. In this round, nine projects worth £1.8 million will benefit from the Fund in Scotland, Wales and Northern Ireland , including supporting the community to save a town hall in New Galloway, a pub in Llandwrog, and to create a digital hub in Cushendall.

Accelerated funding for the Cardiff City Region Deal to fast-track support, including for advanced manufacturing capability in the region.

£172 million from the Levelling Up Fund for 8 projects in Scotland including the redevelopment of Inverness Castle, renovation of the Westfield Roundabout in Falkirk, and a new marketplace in Aberdeen City Centre.

The UK Shared Prosperity Fund will at a minimum match the size of EU Funds in all nations, each year. The Government will also match current EU funding levels in Cornwall.

£120 million for a new Future Nuclear Enabling Fund to support nuclear projects across the UK, with a number of potential sites including the Wylfa in Anglesey, North Wales.

£121 million from the Levelling Up Fund for 10 projects in Wales including to revitalise the Pontcysyllte Aqueduct and Canal World Heritage Site and redevelopment of the Theatr Brycheiniog Arts Centre in Brecon.

A Veterans Commissioner for Wales, who will work to improve the lives and opportunities of the Welsh veterans’ community, recognising their contribution to UK Armed Forces.

The establishment of new trade and investment hubs in Cardiff and Belfast and the expansion of the existing trade and investment hub in Edinburgh, ensuring the benefits of the UK’s global trade policy are channelled across the UK.

A further £8 million from Project Gigabit to deliver full fibre broadband to 3,600 premises in Scotland including Aberdeenshire, Angus, Highland, Moray and Perth and Kinross.

£49 million from the Levelling Up Fund for 11 projects across Northern Ireland including an Electric Vehicle charging network across the country, the redevelopment of a derelict Ministry of Defence site in Derry/Londonderry into an urban community farm, and improved sports facilities in Portrush.


About the Author

© Crown Copyright. Material taken from HM-Treasury. Reproduced under the terms and conditions of the Click-Use Licence.



Follow us @Scopulus_News

Article Published/Sorted/Amended on Scopulus 2021-10-27 16:08:58 in Tax Articles

All Articles

Copyright © 2004-2021 Scopulus Limited. All rights reserved.