Chancellor pledges to do "whatever it takes" to protect Britain from "the debt storm"
In yesterday's Autumn Statement George Osborne confirmed that UK economic growth would be lower and borrowing higher than he had predicted during the March 2011 Budget.
Forecasted encouragement of business through credit easing, investment in infrastructure and improvements in jobs, training and education materialised in the Statement.
Of particular interest to the contractor industry were some of the commitments he made to go ahead with the investment in the building of new and improvement of existing road and rail links - welcomed by all involved in the construction and associated industries.
Other areas of particular interest to contractors and the recruitment sector include:
- Commitment to act on the OTS proposal announced in the 2011 Budget to review the options for a merging of IT/NIC. A lengthy research and consultation exercise may begin in the autumn of 2012.
- The Government will consult in Spring 2012 on streamlining the current regulation of the recruitment sector
- The Government will examine the administrative obligations of the AWR in eighteen months time to ensure that the practical arrangements for employers are as simple as possible.
Some of the more detailed points announced included:
- Planned scrapping of the 3p per litre fuel duty rise in January 2012 and reduction of the planned August 2012 rise from 5p to 3p
- 1% cap on public sector pay rises
- Basic State Pension and Pension Credit rises of over £5 from next April
- Capping of rail fare increases at 6.2% down from the planned 8.2%
- A new mortgage indemnity scheme aimed at helping new homebuyers
- No further changes in the rates of VAT, National Insurance or Income Tax were announced although the Chancellor stated that the Capital Gains Tax Annual Exemption figure for 2012/13 would be frozen at £10,600. The main rate of Corporation tax will reduce to 25% on 1 April 2012 as previously published.
The Statement is seen by many as a sombre and realistic view of the state of the economy against a backdrop of the report from the Office of Budget Responsibility and the current Eurozone crisis. We can, however take some comfort from the commitment to future infrastructure investment.
You can view the complete Autumn Statement 2011 report here.