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Mark Perry responds to the Spring Statement 2022

Today Chancellor Rishi Sunak delivered his Spring Statement 2022 and all eyes were on the measures due to be announced to support the most vulnerable with the increase in the cost of living.

The headlines annoucements include:

  • Rishi Sunak announced a cut to the basic rate of income tax from 20% to 19% by the end of Parliament in 2024.
  • Fuel duty will be cut by 5p a litre from 6pm today until March 2023.
  • The National Insurance threshold will be raised by £3,000, meaning people must earn £12,570 per year before paying income tax or NI.
  • VAT will be scrapped on home energy-saving measures such as insulation, solar panels and heat pumps.
  • The Household Support Fund for local councils to help the most vulnerable will be doubled to £1 billion from April.
  • Retail hospitality and leisure sectors will have a 50% discount in business rates up to £110,000.

Did it address the dilemma millions face of cutting spending on food and clothing to pay energy bills as the cost of living soars?

Mark Perry, Chief Executive at VIVID said:

“The Chancellor’s announcements today are a disappointing response for those most severely affected by what’s been described as the cost of living crisis. This is a missed opportunity. Whilst the increase in national insurance threshold and fuel duty reductions might help those in work, those that aren’t working won’t see any of the benefits. I think the OBR has suggested that in real terms it forecasts the highest reduction in disposal income since record began, in 1950!

"With the economy £20bn ahead of where we expected it to be, surely the government could have used some of that to help those most struggling. Perhaps reinstating the £20 per week Universal Credit cut that took place last year, basing the inflation rate used to uplift benefits to the position it is now at 6.2%.

“The measures announced today won’t really help the reality of what our customers are experiencing when say their small £20 per week budget for food and household essentials used to get them 20 items and will now only just stretch to 17. More needs to be done.”