There was no “jam today” in the Chancellor of the Exchequer’s autumn statement despite the Government’s trumpeting about working to help the “Just About Managing” hard pressed workers.
But there may be some jam tomorrow for Fylde coast families from a restrained budget which gave with one hand but took back with the other.
Philip Hammond revealed a raft of investment programmes to boost house building, infrastructure, research and development and tax to help business post Brexit, but opponents complained that moves to help families could be undermined by a stealth tax on home and car insurance.
The main points included:
A rise in the minimum wage for over 25s, the so-called National Living Wage, from £7.20 to £7.50 in April 2017, worth over £500 to a full-time worker
The continuation of the freeze in fuel duty, scrapping a planned rise in April
Banning fees charged by letting agents to tenants
A reduction in the Universal Credit claw-back rate from 65 per cent to 63 per cent, allowing people to keep more of the benefit as they work
Confirmation that personal tax allowance will rise from £11,000 to £11,500 in April with rises to £12,500 by the end of the Government.
A new savings bond from NS&I allowing people to save up to £3,000 with a gross interest of 2.2 per cent.
A £2.3bn Housing Infrastructure Fund aimed at delivering 100,000 new homes in high-demand areas and £1.4 bn made available to deliver 40,000 additional affordable homes
An additional £1.1bn investment in English local transport, including pinch points on strategic roads, digital signalling on railways and low emission and autonomous vehicles
Investment of more than £1 bn in digital infrastructure and 100 per cent business rates relief on new fibre infrastructure
The right to buy scheme extended to Housing Associations
£556bn to enterprise partnerships in the North
A new National Productivity Investment Fund of £23bn for innovation and infrastructure over the next five years
More investment in research and development, rising to an extra £2bn per year by 2020/21
But the Office for Budget Responsibility slashed growth forecasts for next year and predicted higher than previously expected borrowing, forcing Mr Hammond to confirm he was abandoning predecessor George Osborne’s plan to achieve a budget surplus.
Growth forecasts for next year were cut from the 2.2 per cent predicted in March to just 1.4 per cent as a result of the Brexit vote, the Chancellor said.
Mr Hammond said the slowdown was due to “lower investment and weaker consumer demand, driven, respectively, by greater uncertainty and by higher inflation resulting from sterling depreciation”.
Borrowing is set to be £68.2bn this year and £59bn next year, compared with previous estimates of £55.5bn and £38.8bn.
Shadow Chancellor John McDonnell said the Autumn Statement placed on record the “abject failure of the last six years”.
Blackpool South Labour MP Gordon Marsden described the revelations on national debt as “jaw dropping”.
He said; “The new forecasts say that we will be £122bn worse off in terms of borrowing by 2021 than in the forecast earlier this year.
“Growth will be down next year from from the 2.2 per cent predicted in March to just 1.4 per cent which has an impact on borrowing - we are borrowing £188m a week and all this is a consequence of the Brexit decision.”
He said he was disappointed to seen no extra money for further education which has seen budgets squeezed in recent years and although an east west transport corridor was being funded for Oxford and Cambridge there was no mention of cross Pennine rail improvements.”
He added that the slight reduction in cuts to Universal Credit claw-back and an increase in the personal income tax threshold would be badly hit by the Chancellor’s increase in Insurance tax premium.
He said: “It is to go up from 10 percent to 12 per cent which will impact every form of insurance from house to accident. It will mean all our premiums will go up next year.”
But Fylde conservative MP Mark Menzies said the statement was good news for families and the Fylde coast.
He said: “This budget shows just how far this Government has gone for families.
“When it came in to power, the tax threshold was £6,475. By April it will be £11,500, and by the end of this Parliament, £12,500.
“That is a cut of income tax for some 28 million people, and four million people on the lowest wages who have be taken out of tax altogether.
“And in September, working families in Fylde will be able to take advantage of up to 30 hours’ childcare a week, double the 15 available now. That’s a saving of around £2,000 per child.
“I’m also delighted to see we now have the biggest fuel duty freeze for 40 years, with the fuel duty rise cancelled for the seventh year in a row. It is a sensible move which helps both residents and businesses.
“Fylde’s rural businesses have also been helped with the announcement of 100 per cent rate relief which will see small businesses benefit by up to £2,900 per year.
“The £1.4bn to build 40,000 affordable properties will be a huge help tackling the need for homes, and combined with the announcement of £2.3bn infrastructure fund for areas where homes are needed, will be a further, welcome boost to the economy.
“I am delighted to see the Government still pressing ahead with its plans for the Northern Powerhouse.
“The hundreds of millions of pounds announced in the Autumn Statement for Local Enterprise Partnerships is earmarked for infrastructure and that can only be good for business, good for jobs, and good for the Fylde.”
And Blackpool North and Cleveleys Conservative MP Paul Maynard welcomed measures which he said would help the less well off working families on the Fylde coast.
He said: “In Philip Hammond’s first statement as Chancellor of the Exchequer we see a lot of good news for people on the Fylde coast.
“The average driver will be £130 in pocket, those working full time on the living wage will be £500 a year better off, and the commitment to a tax starting of £12,500 a year has been reaffirmed.
“Post Brexit we are seeing a continuation of a strengthening economy with robust growth, more people in employment than ever before in quality and permanent jobs, and this statement continues down that road with investment in infrastructure, home building, and fibre optic broadband.
“I am also pleased the chancellor has listened on Universal Credit allowing people to earn more before they lose out, this will benefit three million people around the country and many here in Blackpool North and Cleveleys.”