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Key points from Chancellor George Osborne’s Autumn Statement

George Osborne has delivered his first Autumn Statement as the Chancellor of a Conservative government.

In previous years, his hands have been tied by the Liberal Democrats, a junior partner in the previous coalition government. The government has also unveiled its first Comprehensive Spending Review since 2010, detailing spending plans for the next five years, with the aim of balancing Britain’s books by 2020 (1).

One highlight of this year’s Autumn Statement was Osborne’s announcement that the government will no longer be reducing tax credits, which was initially earmarked to save £4.4bn. It comes after considerable public backlash and a voting defeat in the House of Lords (1).

“I’ve had representations that these changes to tax credits should be phased in; I’ve listened to the concerns, I hear and understand them,” said Osborne. “Because I’ve been able to announce today an improvement in the public finances, the simplest thing to do is not to phase these changes in, but to avoid them altogether” (2).

In terms of housing, the Chancellor has pledged 400,000 new affordable homes by the end of the decade; a London Help to Buy scheme; and higher stamp duty on second homes (3).

There was further surprise when the Chancellor announced there would be no cuts to the police budget. It was widely anticipated the Spending Review would confirm that the need for police efficiencies would remain at the top of the agenda, until at least 2020. Most police chiefs and police and crime commissioners had been planning for cuts of 20-25%, but the attacks in Paris cemented the view in Whitehall that the cuts could not go ahead as planned (4).

Other key points from the Autumn Statement and Spending Review include significant departmental spending cuts to Transport at 37% and Energy at 22% (5), while small businesses will continue to benefit from the Small Business Rate Relief scheme, which helps the nation’s smallest firms pay less tax on their premises (6).

 

1 http://www.telegraph.co.uk/finance/autumn-statement/12015681/Autumn-Statement-2015-summary-and-highlights-Everything-you-need-to-know-from-George-Osbornes-speech.html

2 http://www.bloomberg.com/news/articles/2015-11-25/osborne-abandons-u-k-tax-credit-changes-in-face-of-opposition

3 http://www.bloomberg.com/news/articles/2015-11-25/autumn-statement-2015-george-osborne-unveils-spending-review

4 http://www.bbc.co.uk/news/uk-34921212

5 http://www.ft.com/autumn-statement#spending

6 http://www.telegraph.co.uk/finance/autumn-statement/12016340/Autumn-Statement-2015-What-it-means-for-small-businesses.html