“The LPC as an independent body conducts extensive research into the annual report it submits to government setting out its recommended level of national minimum wage, the last figure of which was £6.70 per hour”, he said.
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Nonetheless, Mr Osborne can claim that “Britain is getting a pay rise”, as he triumphantly proclaimed in his Budget statement. Graham Salisbury, head of HR at ActionAid United Kingdom, an accredited living wage employer, told HR magazine that while Osborne’s news was a step in the right direction he was concerned it would only benefit those aged over 25.
Osborne’s headline-grabbing declarations on low pay hide some startling changes on welfare, however.
The Institute for Fiscal Studies said that while Mr Osborne has given businesses, the low-paid and middle class workers £8billion a year in tax cuts, he has also unveiled £14billion worth of tax rises. According to the Chancellor, this means wages will catch up and take over benefits.
Social rent payments will be cut 1 per cent every year until 2019.
Mr Osborne confirmed that the benefits cap is being reduced from £26,000 to £23,000 in London and £20,000 in the rest of the country.
“There are some welcome changes in [Wednesday’s] budget that will help retailers support job creation and drive growth”.
[Related story: The key points of summer Budget 2015]. Reliefs relating to ISA and pension investments will remain unchanged.
There will be no change for existing cars. “The government expects this measure to raise £6.8 billion over the next 5 years which is a tax on those investors”.
Fuel duty freeze will continue.
The chancellor will also reduce the income families must earn to be eligible for tax credits and universal credit. And in Scotland 95% of tax credits are paid to families with children.
The free childcare provision for working parents of three- and four-year-olds will be doubled from 15 hours to 30 hours in some places from September 2016 and everywhere from September 2017. The city region is being given more control over fire services, land, children’s services and employment programmes.
There has been a renewed interest in the buy-to-let sector in recent years as property prices have surged.
Each individual will therefore eventually have a £500,000 nil rate band.
“A cut in inheritance tax is irrelevant to most people in Blackpool -there are not that many wishing to leave more than £1m to their children, it is just playing to the Tory party gallery”. This lifetime allowance will then increase annually at the rate of inflation from April 2018.
The announcement is expected to have an impact on waste and recycling businesses across the country, many of which employ minimum wage workers to sort materials on picking lines at materials recycling facilities.
The Chancellor also appeared to acknowledge criticisms that the system is open to abuse, by allowing rich people to avoid taxes on United Kingdom assets by holding them through offshore companies.
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And university maintenance grants will be replaced with loans.
