The Autumn Statement was presented to the House of Commons on the 5th December; the outlook seemed to be positive for all except the Shadow Chancellor.
Business
Employment is an important factor for the economy and Osborne outlined that the creation of new jobs is vital. He stated that for every 1 job lost in the public sector they have created 3 in the private sector.
Small Businesses are set to benefit, from one of the Government’s latest initiative called the British Business Bank. This is an amalgamation of all the existing initiatives that the Government currently has combines with £1billion of additional capital to help streamline the supply of finance for small businesses.
The National Infrastructure Plan has been revised and now sets out a very forward thinking plan of public and private infrastructure projects, including progress towards a ‘Guarantee’ for a Nuclear power plant in Wylfa.
Other points of interest for business owners;
> From January 2014 the Government will increase the bank’s levy to 0.156%. This increase should ensure that Britain is back on track with its forecasts.
> Reduction in Corporation Tax to 20% by 2015
> From 2014 the RPI increase will be capped in business rates to 2%
> SBRR criteria is to be amended so that businesses in receipt of SBRR can keep it for 1 year when they take on an additional property.
> Introduction of up to £1000 from business rate bills for retail premises with a value up to £50,000 between 2014-2016.
> Temporary reoccupation relief will be introduced from 1 April 2014. This will grant a 50% discount on business rates to new occupants of a premise that was previously occupied for retail use. This discount will last for duration of 18 months and has been established to reduce the number of boarded up building.
Investment in Energy supplies
The Autumn Statement Introduced a new tax relief for Shale gas, this will look to kick start the exploration of onshore gas and oil supplies. If successful this will create jobs and business investment for Britain and hopefully impact our energy bills in a good way.
This new tax relief is something that could impact home buyers. By the Government supporting the exploration of onshore oil and gas this means that the extraction sites could increase across Britain. Home buyers will want to ensure that they are aware of any potential sites for extraction that may affect their future home.
Housing Market Outlook
The housing market has been slowly picking up with London prices growing by 9.4% and outside of London and the South East seeing an average increase of 1.4%. With an increase in prices, mortgage approvals are still low, with the third quarter of 2013 seeing 192,000 approvals. Mortgage rates are also low with lower loan-to-value (LTV) mortgage products more widely accessible. This echoes the success of the Funding for Lending Scheme (FLS) and supports the Governments latest decision to refocus the schemes strategy. For more information on the FLS changes click here…>
The Help to Buy Scheme which was released with the 2013 Budget, was designed to help first time buyers get on the property ladder. The Autumn statement states that this scheme will continue to provide support until it ends in three years.
With these schemes in place to help people to buy homes, the demand for housing has stimulated the supply response. Construction has increase by 1.7% in the third quarter of 2013 with public and private housing being the main drivers, 2013 has also seen a 16% increase in house starts compared with last year.
The second quarter of 2013 has seen 8/10 of major residential planning applications being approved. In England approvals were 35% higher in comparison to last year. The Government is supporting developments and have therefore promised to give £1billion in loans to unblock large housing developments and to give Local Authorities additional flexibility.
With activity increasing in the market and the Government supporting both private and public developments, it is important for home buyers to have the latest and most up-to-date information about the property they would like to purchase – rather than an unwanted surprise.
And finally….. There is great news for anyone with a vehicle as fuel price increases have been frozen. The bad news is that the pension age is set to increase (that is for anyone currently under 30).
If you would like any further information on the Autumn Statement please click here…>
