Spring Statement: What does it mean?

Chancellor of the Exchequer Rishi Sunak provided the first Budget of a new decade today (Wednesday 11 March) in the House of Commons announcing the government’s tax and spending plans for the year ahead. We have pulled out some key points that are relevant to families, childcare providers and employers.

There was a key focus on providing significantly more investment in infrastructure across the UK. However, we know that it is not just roads and rail which carry parents to work but high quality childcare which is equally important to the economy. We are disappointed that the Government failed to recognise this during this Budget.

Some key points from the Budget:

• The National Insurance Contributions threshold will rise from £8,632 to £9,500 – saving people up to £100 a year
• The Chancellor confirmed the end of the benefit freeze from April 2020 meaning many working-age benefits will rise in line with the rising cost of living, for example, child benefit for the eldest child will increase from £20.70 to £21.05 per week
• All VAT on sanitary products is to be abolished
• The Northern Ireland Executive’s block grant will increase by over £210 million through to 2020-21.

In response to the Coronavirus outbreak:

• Statutory Sick Pay costs for businesses with fewer than 250 employees will be met by the Government, in full, for up to 14 days per employee
• Contributory Employment and Support Allowance benefit will be payable for people directly affected by Coronavirus or who are self-isolating from the first day of sickness instead of the eighth day
• People will also be able to claim Universal Credit and access advance payments, without the current requirement to attend a jobcentre
• Self-employed workers who are not eligible for sick pay will be able to claim contributory Employment Support Allowance
• A Hardship Fund of £500 million distributed to Local Authorities in England to directly support vulnerable people in their local area.

If you would like further information about your rights and entitlements as an employee or an employer during this Coronavirus outbreak, you can contact our Family Benefits Advice Service on 028 9267 8200.

Universal Credit

The government has confirmed that there will be funding to increase the rate of transitional payments for claimants in receipt of Severe Disability Premium when they move to Universal Credit. It is also reducing the three year sanction from Universal Credit and Jobseeker’s Allowance.

As Universal Credit continues to rollout across the UK, it is now projected that all claimants will be moved onto the scheme by September 2024.

Tax-Free Childcare

The government is announcing a service improvement that will make Tax-Free Childcare compatible with school payment agents. This change should allow parents across the UK to access Tax-Free Childcare in additional settings and use it toward the cost of their childcare.

While we are aware that some settings who provide registered childcare have experienced difficulty becoming registered with Tax-Free Childcare, we will explore this change further for childcare providers and families in Northern Ireland.

Contact our Family Benefits Advice Service if you have any queries in relation to this. We would urge all childcare providers to register to accept Tax-Free Childcare payments, as this may be the best form of support for families using your service.

National Living Wage / National Minimum Wage

From April 2020, there will be an increase in the National Living Wage, as follows:

• £8.72 per hour for workers aged 25 years and over – National Living Wage
• £8.20 per hour for workers aged 21-24 years
• £6.45 per hour for workers aged 18-20 years
• £4.55 per hour for all workers under the age of 18, who are no longer of compulsory school age
• £4.15 per hour for apprentices under 19, or for first year apprentices 19 or over.

Alongside this, the Government recently announced changes to the rules surrounding minimum wage in relation to Childcare Vouchers. Previously parents could not avail of Childcare Vouchers in cases where the salary sacrifice would bring their hourly rate below the National Living Wage / National Minimum Wage. However, new rules mean that this is no longer the case and Employers For Childcare can advise any parents to whom this change may apply and employers who would like more information. We will be publishing further information on our website in relation to this, and updating all forms and guides, in the coming weeks.

Changing Places

The government has announced a new Changing Places Fund of £30 million to encourage greater provision of Changing Places toilet facilities in new and existing buildings. These facilities are larger than standard disabled toilets, with extra features and more space and we are proud that our new indoor adventure centre – High Rise – includes a Changing Places toilet. The Budget also confirms that the Government will change building regulations guidance by the end of 2020 to mandate the provision of Changing Places toilets in all new public buildings.

Business rates

The Budget confirms that the Government will support shops, pubs, cinemas and music venues in England by increasing and expanding the business rate discount. While this is welcome news, we know from our research that childcare providers also experience high business rates and we believe this is a missed opportunity for the Government to support providers by not including them in this business rate discount.

The Budget also announces the launch of a fundamental review of business rates, due to report in the autumn.

We are here to help

If you are unsure what support you are entitled to contact our Family Benefits Advice Service on 028 9267 8200 (lines open Monday to Friday 8am to 5pm).