Chancellor sets date for Spending Review and Autumn Budget

Chancellor sets date for Spending Review and Autumn Budget

This year's Autumn Budget will be delivered on October 27, alongside a spending review, the Chancellor has confirmed.

Rishi Sunak launched the Spending Review 2021 yesterday (September 7), setting out government funding and asking stakeholders to submit their proposals.

The review takes place roughly every three years.

In a statement, the Chancellor outlined the total resources available for the next three years, including a £440bn increase in day-to-day spending by 2024-25, as well as the £12bn per year for health and social care announced yesterday.

There will also be an increase in capital investment, rising to £600bn over five years. Total core department spending will rise 4 per cent in real terms.

Sunak said: “Since the start of the pandemic, we’ve delivered on an unprecedented scale to protect people’s jobs and livelihoods.

“Despite the worst economic recession in 300 years, we have not only got people back into work through the plan for jobs but continued to deliver on the priorities of the British people.

“At the spending review later this year, I will set out how we will continue to invest in public services and drive growth while keeping the public finances on a sustainable path.”

Stakeholders have been asked to submit a written representation to HM Treasury commenting on government policy and suggesting any new policies they would like to have considered as part of the upcoming review and Budget. The deadline is September 30.

The government faced a backlash from Labour MPs yesterday about its plans to effectively hike National Insurance and introduce a tax on dividends to fund social care reform.

From October 2023, individual care costs will be capped at £86,000, with an extra 1.25 per cent of National Insurance contributions and a £1.25 per cent tax on share dividends set to fund the plans.

Labour MP Dame Margaret Hodge has called the plans the "least progressive option" to fix health and social care.

She challenged Boris Johnson on why he ignored “a raft of better alternatives”, for example, raising income tax or capital gains tax to raise funds for care.

But the Prime Minister said these measures would not have raised anything like what was needed.

Yesterday the government also suspended the wages element of the pensions triple lock to avoid a disproportionate rise of the state pension following the pandemic.

Thérèse Coffey, Secretary of State for Work and Pensions, said for 2022/23 the new and basic state pension will increase by 2.5 per cent or in line with inflation, which is expected to be the higher figure this year.