A significant increase in public spending, funded by a £40bn increase in tax revenue, has been announced and outlined by the Labour government.
The most traditional Labour Budget since the 1970s
The Autumn Budget headlines with £40bn in tax rises and significant policy changes in key areas. This includes higher education, healthcare, and the National Minimum Wage; in what has been described as, “the most traditional Labour Budget since the 1970s”.
Higher education will be provided with an additional £300m. This comes in the wake of demands from universities for increased funding. As reported by The Courier, Newcastle University has found itself in a £35m financial ‘blackhole’. This makes up roughly 5% of the university's turnover.
The National Living Wage is also set to increase by 6.7% to £12.21, for over-21s. The adult minimum wage will also eventually become uniform, as the under-21 minimum wage will eventually be made equal.
The NHS budget is also set to increase by £22.6bn, with Reeves setting an increased 2% target in productivity for all government departments.
The Transpennine route, which students from Manchester and its surrounding area use to get to Newcastle, will also receive a ‘multi-billion pound’ upgrade.
£5bn will be invested in housing as well. The Government has hired more planning officers to help boost affordable housing.
Much of this funding will come from measures such as 20% VAT of private school fees, increases in the rate of capital gains tax, and rises in employer’s contribution towards national insurance.
The so-called ‘sin taxes’, targeting products such as alcohol and tobacco, have also been raised.There will be a 2% increase above inflation rates for tobacco, with hand-rolled tobacco rising by 10%. A levy will also be placed on vapes.
Additionally, attracting much attention however, is the plan to reduce alcohol duties by 1.7% for draught beer. Reeves said this would take “a penny off a pint in the pub”.
“To girls and young women everywhere, I say: let there be no ceiling on your ambition, your hopes and your dreams”
Reeves, a former economist at the Bank of England, was first elected in 2010 and served as Shadow Chancellor for 3 years, from May 2021. Reeves has already made history as the first female Chancellor of the Exchequer in UK history, she remarked during her Budget announcement that she is “deeply proud” to hold such an accolade.
She added, “To girls and young women everywhere, I say: let there be no ceiling on your ambition, your hopes and your dreams”.
