Friday, 1 July 2022 – 12:40

Rishi Sunak unveils Spring Statement

Chancellor Rishi Sunak has delivered the Spring Statement to the House of Commons today, outlining how the government will support people during the cost of living and winter fuel crisis, but the statement was defined more by the absence of policies, than by the measures he outlined.

“Today I can announce, for only the second time in 20 years, fuel duty will be cut, not by 1, not by 2, but by 5 pence per litre. … It will be in place until March next year. Together with the freeze, its a tax cut this year… worth over £5 billion. It will take effect from 6pm tonight.”

“For the next 5 years, homeowners having materials like solar panels, heat pumps, or insulation installed will no longer pay 5% VAT; they will pay 0%. … A family having a solar panel set installed will see tax savings worth £1000, and savings on their energy bill of over £300 per year.”

“Our current plan is to increase the National Insurance Contribution (NIC) threshold by £300.  But I’m not going to do that, … I’m going to increase it by the full £3000 pounds. … From this July people will be able to £12,570 per year without paying a single penny of income tax or national insurance. … The Institute for Fiscal Studies has called it the best way to help low and middle earners through the tax system. … Around 70% of all workers will have their taxes cut by more than they’ll have to pay through the new levy.”

The Chancellor’s main plans were to reduce the cost of fuel in the wake of rising prices, but he did little to help those that are facing rising energy bills, resulting in criticism in a later phone in session where a young mother said she could “see her breath” as she couldn’t afford to pay her energy bills.

Shadow Chancellor Rachel Reeves also criticised the Chancellor’s plans.

“Today was the day the chancellor could have set out a proper plan to support businesses and create new jobs. But he didn’t.”

“Today was the day that he could have properly scrapped his national insurance hike. But he didn’t.”

“Inflation is at its highest level in 30 years and rising. Energy prices at record highs. People are worried sick. For all his words, it is clear that the chancellor does not understand the scale of the challenge. He talks about providing security for working families, but his choices are making the cost-of-living crisis worse, not better.”

“The truth is people can no longer afford the Conservatives.”

His budget also received significant criticism from money saving expert Martin Lewis, who had earlier warned that he was running out of advice, and called on the government to take significant action to support people.

“The cost of living crisis is still going to be a substantial net loss in people’s real income over the next year and what has happened today will not cover that for people on lower or higher incomes but it will mitigate some of the impact.”

“There will still be many people who will be struggling and having to choose between freezing and starving but there will be fewer.”

“And there will be clearly be people who are going to have to curtail their lifestyles due to the cost of living… and some of them won’t have to curtail it quite as much.”

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