Budget 2020: What it Means for You
As the Bank of England has cut the base rate to 0.25% to combat economic woes caused by the coronavirus outbreak, chancellor Rishi Sunak has delivered his first Budget.
Sunak’s announcements were largely informed by the constant presence of the virus. It was the main focus of the speech, with the chancellor announcing vast sums to be allocated to coping with it.
Healthcare
Coronavirus – and the resulting illness COVID-19, were at the forefront of Sunak’s Budget. He told MPs that the NHS will have all the resources it needs to combat the illness. He said: “Whatever extra resources our NHS needs to cope with COVID-19, it will get.”
He added that whether the money is needed for a vaccine, recruiting returning staff or supporting current staff, it will be delivered. He said that this could run to millions or billions of pounds.
The chancellor also announced he would spend an extra £6bn on the NHS. This will go, he said, on 50,000 more nurses, 50 million more GP surgery appointments and the creation of 40 new hospitals across the country.
Transport
Potholes came under attack in the chancellor’s Budget. He announced that he would be making the “largest ever” investment in strategic roads in England, committing to £27bn up until 2025. Part of this will go towards filling in roughly 50 million potholes around the country. It is hoped by many that this will lead to a fall in the number of associated road traffic accidents.
This will fall under the Pothole Fund, which will provide £500m a year. This will account for a 50% rise in local road maintenance budgets in 2020-21. The government is therefore set to spend £1.5bn in that period on filling in potholes and resurfacing roads.
In addition, he promised investment in urban transport, with £4.2 billion for five-year, integrated transport settlements for eight city regions. He also allocated £1bn to transport schemes that are ready to go.
Property
Property was another focus for the chancellor. He said that the provision of affordable and safe housing is a priority of this government. He announced he would be extending the Affordable Homes Programme, with a multi-year figure of £12bn.
He said it will be the biggest investment in affordable housing in a decade.
Sunak also announced that he will cut interest rates on lending for social housing by one percentage point in order to support local authorities to invest in their communities. He said this will make more than £1bn of discounted loans available for local infrastructure.
He added: “I’m confirming nearly £1.1bn of allocations from the Housing Infrastructure Fund to build nearly 70,000 new homes in high demand areas across the country.”
In addition, the government will increase the funding to remove combustible cladding – like the kind that fuelled the Grenfell Tower fire – from tower blocks, investing an extra £1bn.
Employment
The chancellor also promised that the National Living Wage (NLW) should reach two-thirds of national median earnings, while being extended to workers aged 21 and over by 2024. However, this is only as long as economic conditions allow.
He said that based on the latest Office for Budget Responsibility forecast, this means the NLW is expected to be over £10.50 in 2024. This will be a rise of £1.78 per hour from the current rate of £8.72.
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