In his first statement as Chancellor, Phillip Hammond seems to have had the fallout from Brexit weighing on his mind. He warned of turbulent, uncertain times ahead as the UK leaves the EU. But what does his Autumn Statement mean for business and not-for-profits?
Here are the main items for not-for-profits:
Social Investment Tax Relief
Charities should receive a £60m boost over the next five years, thanks to changes in gift aid. Digital intermediaries should now be able to claim gift aid on a charities behalf.
There’s also a further £102m help for charities. This funding comes from fines levied on the banking industry for manipulating the Libor rate.
The amount of tax relief people can claim from socially responsible investments will rise to £1.5 million. Currently, a limit of £293,000 can be invested into a Social Investment Tax Relief (SITR) scheme over three years. SITR enables investors to claim 30% tax relief on loans or equity investments made into social enterprises and charities.
Freeze in fuel duty
Keeping Fuel Duty as it is should help charities keep costs down and help encourage volunteers to travel to the place they support. Pegging the price of fuel duty helps fundraisers and lorry drivers alike.
Overseas aid budget
Although the UK faces uncertain times, the Overseas aid budget will increase to £16.3bn by 2020, while the Foreign Office budget will be protected in real terms.
Reaction from the not for profit sector was muted to say the least.
Here are the main items for businesses:
Helping people off benefits and into work
By reducing the rate at which Universal Credit benefits are withdrawn from people as they start work, the Chancellor hopes to encourage people to leave the benefit claim culture behind. That could help businesses to fill their job vacancies a little more easily.
From April 2017, businesses will find workforce costs rising as the hourly rate increases by 4% to £7.50 If your business relies on staff at the lower end of the pay scale, this will have a noticeable effect. But those companies with a highly skilled and paid workforce will see little or no difference.
£1.3bn of improvements to UK roads
Repairs to the UK’s crumbling and under pressure road networks should be welcomed by any business that needs people or goods to move by road. Being stuck in traffic hinders the economy – this initiative should help save time and money.
£1.4bn towards building 40,000 new affordable homes in England
In a major boost for the building industry, the Government has set aside a large amount to try and make an impact on the lack of affordable housing in England. As well as helping those in need of affordable housing, building companies and builders’ suppliers should notice increased demand.
£2bn extra for science by 2020
With a boost to research and development, the aim is to nurture the companies that put the UK at the cutting edge of science and technology.
An end to letting agents in England charging upfront fees
Cutting costs should help around 4.3 million private rental tenants, as the upfront fees can be as much as £700 on top of the deposit. Businesses may find it easier to find employees as they become a little more mobile. Letting agencies will feel the pinch.
So, a cautious Autumn Statement, but with the national debt standing at £1.6 trillion, there’s little room for manoeuvre, but a small glimmer of hope for businesses.