Budget 2021: Is the devil in the detail?

Budget 2021

On Wednesday 27th October 2021, Rishi Sunak stood up, made his budget 2021 announcement and sat down again without causing much surprise. The recent trend of releasing news of budget spending changes before the statement is made to the House rather takes the excitement out of the event. We have got used to listening to generalised statements about the state of the economy and some tinkering with alcohol or tobacco duties.

The talk was about the post-Covid economy and how things are nowhere near as dire as was predicted when the Chancellor started spending to keep families and businesses afloat. There was some good news on the business rates front, but not a great deal was said about addressing an inflation rate heading towards 4%. We should perhaps be grateful that a planned rise in fuel duty has been cancelled.

On Housing there were specifics but, again, no big surprises. There is a multi-year fund of £24bn, roughly half of which is earmarked for the building of new homes, with brown-field sites prioritised. Residential property developers whose profits exceed £25m will be subject to a levy, which will be used to remove unsafe cladding from properties deemed most at risk.

On a smaller scale, while there was no reversal of the decision to remove the top-up of Universal Credit, the credit taper, which kicks in as earnings from employment rises, has been made less severe. On top of the changes to the minimum wage announced earlier, rent affordability should be improved. According to the Chancellor “a single mother of two renting, and working full time on the national living wage, will be better off by around £1,200.”

Perhaps we should be relieved there were no shocks in the speech for the property rental sector, but I’ll be keeping my eyes open as the detail is picked apart over the next few days.