“It cannot be denied that it has been a challenging and tumultuous few months since Philip Hammond, The Chancellor of the Exchequer, last announced Government’s plans to boost UK plc’s purse – especially for the education, NHS and social care sectors – in the Autumn Statement 2016.
“With the current skills shortage, the announcement in the Spring Budget that £300 million will be invested to support 1,000 new PhD places and fellowships in STEM subjects is good news, along with the introduction of new T-Levels to give parity of esteem for technical education. In addition, the funding of £320 million for 110 new free schools, to take the total to 500, will serve as some relief in a changing climate with soaring pupil numbers. Lastly, the investment of £216 million in school maintenance will be hugely welcomed by the education sector, after what has been a prolonged period of austerity.
“Moving to the health and care sector, today’s announcement that an additional £2 billion will be injected into social care over the next three years is a positive step forward – although, of course, it’s not just money that will ultimately protect the health service from a deepening crisis that could affect millions of patients. That being said, with Government’s pledge to make £1 billion of this investment available for 2017-18, this will go some way toward further tackling the social care challenges in the short-term.
“With the further announcements that there will be an additional £325 million invested to allow the first NHS Sustainability and Transformation Plans to proceed and a £100 million boost to place more GPs in accident and emergency departments for next winter, this is another move in the right direction.
“However, these positive developments will be thwarted by the challenges of a creeping NHS spend deficit, delivering patient care around the clock, an ageing population and a national shortage of healthcare professionals – compounded with the potential Brexit-effect.
“de Poel’s view is that Government and providers need to keep transforming the system, integrating health and social care, supporting people before they reach the point of needing hospital or residential care, better harnessing innovative technology and fostering more efficient collaboration with the wider public sector. For these very reasons, we welcome a consultation into longer-term solutions for the NHS and social care sectors and further discussion on a plan to engage staff – on the frontline delivering care – in a more effective way. There is a now critical need to identify opportunities beyond the existing system, where the limitations are well known, and tap into different and innovative ways of responding to need and demand.
“Other interesting takeaways from the Budget detail vehicle excise duty rates for hauliers, and the HGV Road User Levy that has been frozen for another year. In addition, new measures concerning business rates were announced, including a cap so rates rise by no more than £50 a month for small businesses losing their rate relief and a £300 million fund for discretionary relief for local authorities, so they can respond more flexibility to local circumstances.
“Hammond also used the Budget to unveil new Government measures to further crack down on ‘loopholes’ in the tax system, expected to generate £820 million in savings. These measures include VAT on roaming telecoms outside the EU, tackling abuse of foreign pension schemes, a new financial penalty for professionals who create schemes defeated by HMRC and stopping businesses from converting capital losses into trading losses.
“New Government measures announced by Hammond to improve fairness in tax levels between the employed and self-employed have clearly been brought into play against the back drop of numerous headlines around true self-employment and ‘gig workers’. As an item high on Government’s agenda, an investigation into tax treatment is being conducted by Matthew Taylor of RSA, and the Treasury aims to raise £145 million from increasing National Insurance Contributions of some self-employed people. This announcement has proven particularly contentious with Theresa May announcing within just 48 hours a delay in legislating on this issue until the Autumn budget. de Poel will keep our client and agency partners posted on such developments.
“On a final note, despite hopes in many quarters, there was no further commentary or clarity offered by Government on the looming Apprenticeship Levy or IR35 changes. This appears to mean full steam ahead for these complex changes, with less than a month to go before their implementation.”
We, at de Poel, are committed to helping our clients understand and navigate these complexities. We have created a legislative update, ‘Inter Alia’ for our clients operating within the public sector and private sector – which we hope you find of interest and assistance.