According to the latest spending plans of the Chancellor, more money will be invested in apprenticeships, the national living wage will be raised, and pension flexibility will be improved.
According to chancellor of the exchequer Jeremy Hunt, the autumn statement would “reward work and people ”.
“The government knows that a dynamic economy depends onmore than any diktats or decisions by ministers,” he said, adding: “Today’s measures don’t just remove barriers to investment, they reward effort and work.”
In addition to reforming pensions, apprenticeships, and pay for workers, Hunt announced plans this afternoon.
However, Rachel Reeves, the shadow chancellor, responded to Hunt’s speech by saying that “working people are still worse off”.
She said that “the reality of the Conservatives’ record is that average wages for working people have been heldgovernment has “held back growth, crashed our economy, increased debt, trashed our public services, left businesses out in the cold and made life harder for working people”.
Takeaways for HR professionals from today’s announcement include:
Apprenticeships to receive a boost of £50m
“No economy can prosper without investing in the potential of its people,” Hunt said, adding that the government would use the statement to focus on “skills”.
Over the next two years, the government will invest £50 million in boosting apprenticeships in engineering and “other key growth areas”.
Enhancing pension flexibility
The chancellor also committed to triple-locking pensions, with the state pension increasing by 8.5% in April, which is the second largest rise ever. Inflation has squeezed people’s disposable income and diminished their savings during this extended period.
Further pension reformscommitments to consolidate pensions, with Hunt adding that the government will consult on giving workers a “legal right to require a new employer to pay pension contributions into their existing pension pot if they choose, meaning people can choose to have one pension pot for life”.
The national living wage increased by 10% and was extended to younger workers too
Following the cost of living crisis, the government announced the biggest increase to the national living wage in more than a decade. From April, it will increase by 9.8 percent to £11.44 per hour, up from £10.42. This is the first time it will cover workers who are 21 or 22 years old.
18 to 20 year olds will also see their pay rise by £1.11 an hour to £8.60 with the new national minimum wage.
Apprenticeships will also be paid more, with an 18-year-old earning a minimum of £6.40 an hour in industries such as construction.
National insurance contributions are cut
There will be a reduction of 10% in the main rate of national insurance for employees. It will be implemented on 6 January 2024, rather than the start of the new tax year in April.
Earnings between £12,571 and £50,271 are subject to a 12 percent national insurance contribution, and earnings over that are subject to a 2 percent contribution. There will be a tax cut for 27 million people as a result of this.
Reform of jobseeker benefits
The government announced its Back to Work Plan to assist those with long-term sicknesses and disabilities to return to work. “Every year we sign off over 100,000 people on benefitssickness and That waste of potential is wrong economically, he said.
According to the chancellor, this would include reforms to fitness notes and work capability assessments.
Reforms to welfare are also included. A further £1.3 billion will be provided by the government to help 300,000 people who have been unemployed for more than a year without illness or disability.
A mandatory work placement program will be implemented if jobseekers haven’t found jobs after 18 months of assistance. Jobseekers will lose their benefits if they do not engage in this scheme for six months.
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