Autumn Statement 2016 Philip Hammonds speech
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Autumn Statement 2016 Philip Hammonds speech
From: HM Treasury and The Rt Hon
Philip Hammond MP
Delivered on: 23 November 2016
Location: House of Commons
First published: 23 November 2016
Last updated: 23 November 2016, see all
Part of: Autumn Statement 2016
The Autumn Statement speech in full.
It is a privilege to report today on an economy which the IMF
predicts will be the fastest growing major advanced economy in the
world this year.
An economy with employment at a record high – and unemployment
at an 11 year low.
An economy which, through the hard work of the British people,
has bounced back from the depths of recession.
And an economy which has confounded commentators at home and
abroad with its strength and its resilience since the British people
decided, exactly five months ago today, to leave the European Union and
chart a new future for our country.
That decision will change the course of Britain’s history.
It has thrown into sharp relief the fundamental strengths of
the British economy that will ensure our future success:
The global reach of our services industries
The strength of our science and high-tech manufacturing base.
And the cutting-edge British businesses that are leading the
world in disruptive technologies,
But it’s a decision that also makes more urgent than ever the need to
tackle our economy’s long-term weaknesses.
Like the productivity gap.
The housing challenge.
And the damaging imbalance in economic growth and prosperity
across our country.
We resolve today to confront those challenges head on.
To prepare our country to seize the opportunities ahead.
And in doing so, to build an economy that works for
everyone…and where every corner of this United Kingdom is part of our
I want to pay tribute to my predecessor, my Rt Hon Friend the
Member for Tatton.
My style will, of course, be different from his.
I suspect that I will prove no more adept at pulling rabbits
from hats than my successor as Foreign Secretary has been at retrieving
balls from the back of scrums.
But my focus on building Britain’s long-term future will be
He took over an economy with the highest budget deficit in our
And brought it down by two-thirds.
But times have moved on.
And our task now is to prepare our economy to be resilient as
we exit the EU.
And match-fit for the transition that will follow.
So we will maintain our commitment to fiscal discipline.
While recognising the need for investment to drive
And fiscal headroom to support the economy through the
Let me turn now to the forecasts.
Since 2010, the Office for Budget Responsibility has provided
an independent economic and fiscal forecast, to which the government
And I thank Robert Chote and his team for their hard work.
Today’s OBR forecast is for growth to be 2.1% in 2016; higher
than forecast in March.
In 2017 the OBR forecasts growth to slow to 1.4%, which they
attribute to lower investment and weaker consumer demand, driven,
respectively, by greater uncertainty and by higher inflation resulting
from sterling depreciation.
That’s slower, of course, than we would wish, but still
equivalent to the IMF’s forecast for Germany, and higher than the
forecast for growth in many of our European neighbours, including
France and Italy.
As the effects of uncertainty diminish, the OBR forecasts
growth recovering to 1.7% in 2018, 2.1% in 2019 and 2020, and 2% in
While the OBR is clear that it cannot predict the deal the UK
will strike with the EU, its current view is that the referendum
decision means that potential growth over the forecast period is 2.4
percentage points lower than would otherwise have been the case.
The OBR acknowledges that there is a higher degree of
uncertainty around these forecasts than usual.
Despite slower growth, the UK labour market is forecast to remain
We’ve delivered over 2.7 million new jobs since 2010.
This forecast shows that number growing in every year –
another 500,000 over the OBR forecast – providing security for working
people across the length and breadth of Britain.
Over the past year, employment grew fastest in the North East;
the claimant count fell fastest in Northern Ireland; pay grew most
strongly in the West Midlands; and every UK nation and region saw a
record number of people in work.
A labour market recovery that is working for everyone.
Monetary policy has played an important role in supporting
growth since the Referendum decision. But a credible fiscal policy
remains essential for maintaining market confidence and restoring the
economy to long term health.
In view of the uncertainty facing the economy, and in the face
of slower growth forecasts, we no longer seek to deliver a surplus in
But the Prime Minister and I remain firmly committed to seeing
the public finances return to balance as soon as practicable.
While leaving enough flexibility to support the economy in the
Today I am publishing a new draft Charter for Budget
Responsibility, with three fiscal rules:
First, the public finances should be returned to balance as
early as possible in the next Parliament, and, in the interim,
cyclically-adjusted borrowing should be below 2% by the end of this
Second, that public sector net debt as a share of GDP must be
falling by the end of this Parliament.
And third, that welfare spending must be within a cap, set by
the government and monitored by the OBR.
In the absence of an effective framework, the welfare bill in
our country spiralled out of control, with spending on working-age
benefits trebling in real terms between 1980 and 2010.
As a result of the action we’ve taken since 2010, that
spending has now stabilised.
The cap I am announcing today takes into account policy
changes since the last Budget, setting a realistic baseline reflecting
all announced welfare policies.
And I confirm again that the government has no plans to
introduce further welfare savings measures in this parliament beyond
those already announced.
I now turn Mr Speaker, to the OBR’s fiscal forecasts, but
first I will set out the key drivers of changes since the Budget:
The post-Budget changes to welfare and housing policies cost
the Exchequer £8.6 billion over the forecast period;
Expected ONS classification changes have added £12 billion
And tax receipts have been lower than expected this year,
causing the OBR to revise down projected revenues in future.
Added to this is a structural effect of rapidly rising
incorporation and self-employment, which further erodes revenues.
Combining these pressures with the impact of forecast weaker
growth, and taking account of the measures I shall announce today, the
OBR now forecast that in cash terms, borrowing is set to be:
£68.2 billion this year; falling to £59 billion next year;
£46.5 billion in 2018-19; then £21.9 billion; £20.7 billion, and
finally £17.2 billion in 2021-22.
Overall public sector net borrowing as a percentage of GDP
will fall from 4% last year to 3.5% this year, and will continue to
fall over the Parliament, reaching 0.7% in 2021-22.
This will be the lowest deficit as a share of GDP in two
The OBR expects cyclically adjusted public sector net
borrowing to be 0.8% of GDP in 2020-21, comfortably meeting our target
to reduce it to less than 2% …
And leaving significant flexibility to respond to any
headwinds the economy may encounter.
The OBR’s forecast of higher borrowing and slower asset sales,
together with the temporary effect of the Bank of England’s action to
stimulate growth, translates into an increased forecast for debt in the
The OBR forecasts that debt will rise from 84.2% of GDP last
year to 87.3% this year, peaking at 90.2% in 2017-18 as the Bank of
England’s monetary policy interventions approach their full effect.
In 2018-19, debt is projected to fall to 89.7% of national
income - the first fall in the national debt as a share of GDP since
And it is forecast to continue falling thereafter.
Stripping out the effects of the Bank of England
interventions, underlying debt peaks this year at 82.4% of GDP and
falls thereafter to 77.7% by 2021-22.
I have received representations from a range of external
Some of them calling for fiscal expansion; while others have
suggested there is no need at all to respond to a changed economic
That reflects the challenge we face of resolving how best to
protect the recovery, build on the economy’s strengths, yet at the same
time respond appropriately to the warnings of a more difficult period
But with our debt forecast to peak at 90% next year, and a
deficit this year of 3.5%, I have reached my own judgement.
It is a judgement based on a sober analysis of our fiscal
But also on a realistic appraisal of the weakness of UK
productivity, and the urgent need to address our fiscal challenge from
Continuing to control public expenditure, but also growing the
potential of the economy and protecting the tax base.
So we choose in this Autumn Statement to prioritise additional
high-value investment, specifically in infrastructure and innovation,
that will directly contribute to raising Britain’s productivity.
And the key judgement we make today is that our hard-won
credibility on public spending means we can fund this commitment, in
the short-term, from additional borrowing.
While funding all other new policies announced in this Autumn
Statement through additional tax and spending measures.
That is the responsible way to secure our economy for the long
The productivity gap is well known, but shocking nonetheless:
We lag the US and Germany by some 30 percentage points.
But we also lag France by over 20 and Italy by 8.
Which means in the real world, it takes a German worker 4 days
to produce what we make in 5; which means, in turn, that too many
British workers work longer hours for lower pay than their counterparts.
That has to change if we are to build an economy that works
Raising productivity is essential for the high-wage,
high-skill economy that will deliver higher living standards for
I can announce today a new National Productivity Investment
Fund of £23 billion to be spent on innovation and infrastructure over
the next five years.
Investing today for the economy of the future.
Let me set out for the House how this money will be used:
Mr Speaker, we do not invest enough in research, development
As the pace of technology advances and competition from the
rest of the world increases, we must build on our strengths in science
and tech innovation to ensure the next generation of discoveries is
made, developed and produced in Britain.
So today I can confirm the additional investment in
R&D, rising to an extra £2 billion per year by 20-21, announced
by my Right Honourable Friend, the Prime Minister on Monday.
Mr Speaker, economically productive infrastructure directly
But families, too, rely on roads, rail, telecoms – and, especially
We have made good progress, with the number of new homes being
built last year hitting an eight-year high. But for too many, the goal
of home ownership remains out of reach.
In October, my Right Honourable Friend, the Communities
Secretary launched the £3 billion Home Builders’ Fund, to unlock over
200,000 homes and up to £2 billion to accelerate construction on public
But we must go further still.
The challenge of delivering the housing we so desperately need
in the places where it is currently least affordable is not a new one…
But the effect of unaffordable housing on our nation’s
productivity makes it an urgent one.
My Right Honourable Friend, the Communities Secretary will
bring forward a Housing White Paper in due course, addressing these
But in the meantime, we can take further steps:
One of the biggest objections to housing development is often
the impact on local infrastructure.
So we will focus government infrastructure investment to
unlock land for housing…
With a new £2.3 billion Housing Infrastructure Fund to deliver
infrastructure for up to 100,000 new homes in areas of high demand.
And, to provide affordable housing that supports a wide range
of need, we will invest a further £1.4 billion to deliver 40,000
additional affordable homes.
And we will relax restrictions on government grant to allow a
wider range of housing-types.
I can also announce a large-scale regional pilot of Right to
Buy for Housing Association tenants.
And continued support for home ownership through the Help to
Buy: Equity Loan scheme and the Help to Buy ISA.
Mr Speaker, this package means that over the course of this
Parliament, the government expects to more than double, in real terms,
annual capital spending on housing.
Coupled with our resolve to tackle the long term challenges of
This commitment to housing delivery represents a step-change
in our ambition to increase the supply of homes for sale and for rent,
to deliver a housing market that works for everyone.
Mr Speaker, reliable transport networks are essential to
growth and productivity.
So this Autumn Statement commits significant additional
funding to help keep Britain moving now, and to invest in the transport
networks and vehicles of the future.
I will commit an additional £1.1 billion of investment in
English local transport networks, where small investments can offer big
£220 million to address traffic pinch points on strategic
£450 million to trial digital signalling on our railways to
achieve a step-change in reliability.
And squeeze more capacity out of our existing rail
And finally, £390 million to build on our competitive
advantage in low emission vehicles and the development of connected
autonomous vehicles; plus a 100% first year capital allowance for the
installation of electric vehicle charging infrastructure.
The Department for Transport will continue to work with
Transport for the North to develop detailed options for Northern
My Right Honourable Friend, the Transport Secretary will set
out more details of specific projects and priorities over the coming
Our future transport, business and lifestyle needs will
require world class digital infrastructure to underpin them. So my
ambition is for the UK to be a world leader in 5G.
That means a full-fibre network; a step-change in speed,
security and reliability.
So we will invest over £1 billion in our digital
infrastructure to catalyse private investment in fibre networks and to
support 5G trials.
And from April we will introduce 100% business rates relief
for a 5 year period on new fibre infrastructure, supporting further
roll out of fibre to homes and businesses.
We have chosen to borrow to kick-start a transformation in
infrastructure and innovation investment.
But we must sustain this effort over the long term if we are
to make a lasting difference to the UK’s productivity performance.
So today I have written to the National Infrastructure
To ask them to make their recommendations on the future
infrastructure needs of the country.
Using the assumption that government will invest between 1%
and 1.2% of GDP every year from 2020 in economic infrastructure covered
by the Commission.
To put this in context, we’ll spend around 0.8% of GDP on the
same definition this year.
I am also backing the Commission’s interim recommendations on
the Oxford-Cambridge growth corridor published last week.
With £110m of funding for East West Rail, and a commitment to
deliver the new Oxford to Cambridge Expressway.
But this project can be more than just a transport link.
It can become a transformational tech-corridor, drawing on the
world-class research strengths of our two best-known universities.
So I welcome the Commission’s continuing work on delivery
model options, and we will carefully consider its final recommendations
in due course.
The major increase in infrastructure spending I’ve announced
today will represent a significant increase in funding through the
Barnet formula of:
Over £250 million to the Northern Ireland Executive.
£400 million to the Welsh government.
And £800 million to the Scottish government.
But public investment is only part of the picture.
About half of our economic infrastructure is financed by the
private sector, and we will continue to support that investment through
the UK Guarantees Scheme, which I am today extending until at least
The new capital investment I have announced today will provide
the financial backbone for the government’s Industrial Strategy, which
the Prime Minister spoke about on Monday.
A firm foundation upon which my Rt Hon Friend the Business
Secretary will work with industry to build our ambition of an economy
that works for all.
And I can announce four further measures to back business.
I am doubling UK Export Finance capacity to make it easier for
British businesses to export;
I am funding Charlie Mayfield’s business-led initiative to
boost management skills across British businesses; and I am taking a
first step to tackle the longstanding problem of our fastest growing
technology firms being snapped up by bigger companies, rather than
growing to scale.
By injecting an additional £400m into venture capital funds
through the British Business Bank, unlocking £1 billion of new finance
for growing firms.
And I am launching a Treasury-led review of the barriers to
accessing patient capital in the UK.
This government recognises that for too long, economic growth
in our country has been too concentrated in London and the south east.
That’s not just a social problem, it’s an economic problem.
London is one of the highest-productivity cities in the world
and we should celebrate that fact.
But no other major developed economy has such a gap between
the productivity of its capital city and its 2nd and 3rd cities.
So we must drive up the performance of our regional cities.
Today we publish our strategy for addressing productivity
barriers in the Northern Powerhouse; and give the go ahead today to a
programme of major roads schemes in the north.
Our Midlands Engine strategy will follow shortly, but I am
today providing funding for the evaluation study for the Midlands Rail
In addition, we are investing in local infrastructure in every
region of England:
I can announce the allocation of £1.8 billion from the Local
Growth Fund to the English regions:
£556 million to Local Enterprise Partnerships in the North of
England, £542 million to the Midlands and East of England, and £683
million to LEPs in the South West, South East and London.
We will announce the detailed breakdown of allocations to
individual LEPs shortly.
Devolution remains at the heart of this government’s approach
to supporting local growth, and we recommit today to our City deals
with Swansea, Edinburgh, North Wales and Tay Cities – and I can
announce today we’re beginning negotiations on a city deal for Stirling.
So that every city in Scotland will be on course to have a
To support new mayoral combined authorities in England, I can
announce that we will grant them new borrowing powers to reflect their
And while we continue discussions with London and the West
Midlands on possible devolution of further powers.
I can announce today that London will receive £3.15 billion as
its share of national affordable housing funding to deliver over 90,000
And that we are devolving to London the adult education
budget, and giving London greater control over the delivery of
employment support services for the hardest to help.
Mr Speaker, I have deliberately avoided making this statement
into a long list of individual projects being supported.
But I am going to make one exception:
I will act today, with just seven days to spare, to save one
of the UK’s most important historic houses: Wentworth Woodhouse near
It is said to be the inspiration for Pemberley in Jane
Austen’s Pride and Prejudice.
Wentworth Woodhouse is now at critical risk of being lost to
A local effort has secured millions in funding – subject to
the balance required being found by November 30th.
So we will provide a £7.6 million grant towards urgent repairs
to safeguard this key piece of Northern heritage. I can also confirm
distribution of a further £102 million of LIBOR bank fines to Armed
Forces and Emergency Services charities…
…including £20 million to support the Defence and National
Rehabilitation Centre at Stanford Hall in Nottinghamshire – and £3
million from the Tampon Tax Fund for Comic Relief to distribute to a
range of women’s charities.
We choose to invest in our economic infrastructure because it
can transform the growth potential of our economy, as well as improving
the quality of people’s lives.
That investment is only possible because the government is
prepared to take the tough decisions to maintain control of current
In 2010, public spending was 45% of GDP – this year it’s set
to be 40%.
And since 2010 we’ve seen crime fall by more than a quarter;
The highest proportion ever of good or outstanding schools;
The number of doctors has increased by 10,000;
Pensioner poverty at its lowest level ever;
The lowest ever number of children being raised in workless
And the highest ever number of young people going on to study
full time at university.
We have demonstrated beyond doubt that controlling public
spending is compatible with world-class public services and social
But as the OBR’s debt projections demonstrate, we have more
work to do to eliminate the deficit.
So departmental spending plans set out in the Spending Review
last autumn will remain in place, and departmental expenditure in 21-22
will grow in line with inflation.
The £3.5 billion of savings to be delivered through the
Efficiency Review announced at the Budget, and led by my Right
Honourable Friend, the Chief Secretary, must be delivered in full.
I have, however, exceptionally agreed to provide additional
funding to the Ministry of Justice to tackle urgent prison safety
issues increasing the number of prison officers by 2,500.
Having run two large spending departments in previous roles, I
came to this job with some very clear views about the relationship
between the Treasury and spending departments.
I want departments to be incentivised to drive efficiencies.
And I want the Treasury to be an enabler for good, effective spending
To kickstart this new approach, I will allow up to £1bn of the
savings found by the efficiency review in 19/20 to be reinvested in
priority areas and I have budgeted today accordingly.
Mr Speaker, we manage public spending so that we can invest in
the public’s priorities.
And the government has underlined those priorities with a
series of commitments and protections for the duration of this
I can confirm that, despite the fiscal pressures, we will meet
our commitments to protect the budgets of key public services and
We will keep our promise to the world’s poorest through our
overseas aid budget,
And we will meet our pledge to our country’s pensioners
through the triple lock.
But as we look ahead to the next Parliament, we will need to
ensure we tackle the challenges of rising longevity and fiscal
And so the government will review public spending priorities
and other commitments for the next Parliament in light of the evolving
fiscal position at the next Spending Review.
Mr Speaker I now turn to taxation.
Since 2010 the government has put a business-led recovery at
the heart of our plan, we’ve cut corporation tax from 28% to 20%,
sending the message that Britain is open for business.
The additional investment in productivity and infrastructure
that I have announced underscores that message….
And the raft of investments in the UK announced since the referendum –
by Softbank, Glaxo, Nissan, Google and Apple amongst others, confirms
My priority as Chancellor is to ensure that Britain remains
the number one destination for business – creating the investment, the
jobs and the prosperity to protect our long-term future.
I know how much business values certainty and stability, and
so I confirm today that we will stick to the business tax roadmap we
set out in March.
Corporation tax will fall to 17%, by far the lowest overall
rate of corporate tax in the G20.
We will deliver the commitments we have made to the oil and
the Carbon Price Support will continue to be capped out to
and we will implement the business rates reduction package
worth £6.7 billion.
I can confirm today that having consulted further, my Right
Honourable Friend, the Communities Secretary will lower the
transitional relief cap from 45% next year to 43%, and from 50% to 32%
the year after.
And I will also increase the Rural Rate Relief to 100%, giving
small businesses in rural areas a tax break worth up to £2,900 per year.
In return for our competitive rates, the tax base must be
From April 2017 we will align the employee and employer
National Insurance thresholds at £157 per week.
There will be no cost to employees, and the maximum cost to
business will be an annual £7.18 per employee.
Insurance premium tax in this country is lower than in many
other European countries, and half the rate of VAT.
In order to raise revenue, which is required to fund spending
commitments I am making today, it will rise from 10% currently, to 12%
from next June.
At the same time I can confirm the government’s commitment to
legislate next year to end the compensation culture surrounding
whiplash claims – a major area of insurance fraud – saving drivers an
average of £40 on their annual premiums.
Mr Speaker, technological progress is changing the way people
live, and the way they work;
The tax system needs to keep pace. For example, the OBR has
today highlighted the growing cost to the Exchequer of incorporation.
So the government will consider how we can ensure that the
taxation of different ways of working is fair between different
individuals, and sustains the tax-base as the economy undergoes rapid
We will consult in due course on any proposed changes.
In the meantime, the government will take action now to reduce
the difference between the treatment of cash earnings and benefits.
The majority of employees pay tax on a cash salary. But some
are able to sacrifice salary and pay much lower tax on benefits in kind.
This is unfair, and so from April 2017 employers and employees
who use these schemes will pay the same taxes as everyone else.
Following consultation with stakeholders, ultra-low emission
cars, pensions saving, childcare and the cycle to work scheme will be
excluded from this change. And certain long-term arrangements will be
protected until April 2021.
For pensions that have been drawn-down, I will also reduce to
£4,000 the Money Purchase Annual Allowance, to prevent inappropriate
double tax relief.
The government is committed to tackling tax evasion, avoidance
and aggressive tax planning, and the UK tax gap is now one of the
lowest in the world.
But we must constantly be alert to new threats to our tax base
– and be willing to move swiftly to counter them.
At the Budget we committed to removing the tax benefits of
disguised earnings for employees, and I am now going to do the same for
the self-employed and employers, raising a further £630 million over
the forecast period.
We will shut down inappropriate use of the VAT flat rate
scheme that was put in place to help small businesses;
We will abolish the tax advantages linked to Employee
Shareholder Status in response to evidence it is primarily being used
for tax-planning purposes by high-earning individuals;
And we will introduce a new penalty for those who enable the
use of a tax avoidance scheme that HMRC later challenges and defeats.
These measures – and others set out in the Autumn Statement
document – raise around £2 billion over the forecast period.
Mr Speaker, there is understandable public concern that the
pitch is tilted in favour of large multinational groups which are able
to use cross-border structures to manage their tax liabilities.
Following detailed consultation, I can confirm that we will
implement our new restriction on tax relief for corporate interest
expenses, and reform the way that relief is provided for historic
These measures, scored at Budget 2016, will help to ensure
large businesses will always pay tax in years where they make
They will also mean that businesses cannot avoid tax by
borrowing excessively in the UK to fund their overseas activities.
They take effect in April, and raise over £5 billion from the
largest businesses in the UK.
Mr Speaker, I said that the tax system must be fair and that
means rewarding those who work hard by helping them to keep more of
what they earn.
There is one tax reform the government has pursued since 2010
to improve the lot of working people.
Raising the tax-free personal allowance.
When we entered government in 2010 it was £6,475.
Now, after 6 years it is £11,000, and will rise to £11,500 in
As a result, we have more than halved the tax bill of someone
with a salary of £15,000 to just £800.
That’s a massive boost to the incomes of low and middle
Since 2010 we’ve cut income tax for 28 million people and
taken 4 million people out of income tax altogether.
And I can confirm today that, despite the challenging fiscal
forecasts, we will deliver on our commitment to raising the allowance
to £12,500, and the higher rate threshold to £50,000, by the end of
Once £12,500 has been reached, the personal allowance will
rise automatically during the 2020s in line with inflation, rather than
the National Minimum Wage as currently planned.
It will be for the Chancellor to decide from year to year
whether more is affordable.
As well as taking millions of ordinary people out of tax, the
government introduced the National Living Wage and gave a pay rise to
over a million workers.
The government has also introduced 15 hours a week of free
childcare for all 3 and 4 year olds, and we will double that for
working families from September.
The government’s education reforms have raised standards and
expanded opportunity with 1.4 million more children now in ‘good’ or
And the new capital funding I have provided today for grammar
schools will help to continue that trend.
The government, Mr Speaker, has pledged to invest in our NHS
and we are delivering on that promise: backing the NHS’ Five Year
Forward View plan for the future with £10 billion of additional funding
a year by the end of 2020-21.
But we recognise that more needs to be done to help families
make ends meet and to ensure every household has opportunities to
Today I can announce the National Living Wage will increase
from £7.20 to £7.50 in April next year. That’s a pay rise worth over
£500 a year to a full-time worker.
Creating jobs, lowering taxes and raising wages addresses
directly the concerns of ordinary families.
And the revenue-raising measures I have announced today enable me to go
further to help families on low wages:
Universal Credit is an important reform to our benefits system
and is designed to make sure work always pays. We want to reinforce
From April, we can reduce the Universal Credit taper rate from
65% to 63%.
This is effectively a targeted tax cut worth £700m in 21-22
for those in work on low incomes;
It will increase the incentive to work and encourage
progression in work;
And it will help 3 million households across our country.
We believe that a market economy is the best way of delivering
sustained prosperity for the British people.
We will always support a market led approach; but we will not
be afraid to intervene where there is evidence of market failure.
We will look carefully over the coming months at the
functioning of key markets, including the retail energy market, to make
sure they are functioning fairly for all consumers.
In the private rental market, letting agents are currently
able to charge unregulated fees to tenants.
We have seen these fees spiral, often to hundreds of pounds.
This is wrong. Landlords appoint letting agents and landlords
should meet their fees.
So I can announce today that we will ban fees to tenants as
soon as possible.
And we will consult on how best to ban pensions cold calling
and a wider range of pension scams.
We can also help those who rely on income from modest savings
to get by.
Low interest rates have helped our economy recover, but
they’ve significantly reduced the interest people can earn on their
So we will launch a new, market-leading savings bond through
The detail will be announced at the Budget, but we expect our
new Investment Bond will have an interest rate of around 2.2% gross and
a term of 3 years.
Savers will be able to deposit up to £3,000, and we expect
around 2 million people to benefit.
The announcements I have made today lower taxes on working
people; boost wages; back savers; and bear down on bills.
In early 2017, we will begin the roll out of tax-free
childcare across Britain, providing a saving of up to £2,000 per child.
And once it’s rolled-out, we will keep it under review to
ensure it’s delivering the support they need to working families.
There is one further area of household expenditure where the
government can help.
The oil price has risen by over 60% since January; and
sterling has declined by 15% against the dollar.
That means significant pressure on prices at the pump here in
So today we stand on the side of the millions of hardworking
people in our country by cancelling the fuel duty rise for the seventh
In total this saves the average car driver £130 a year and the
average van driver £350.
This is a tax cut worth £850 million next year, and means the
current fuel duty freeze is the longest for 40 years.
Mr Speaker, I have one further announcement to make.
This is my first Autumn Statement as Chancellor.
After careful consideration, and detailed discussion with the
Prime Minister, I have decided that it will also be my last.
Mr Speaker I am abolishing the Autumn Statement.
No other major economy makes hundreds of tax changes twice a
year, and neither should we.
So the spring Budget in a few months will be the final spring
Starting in autumn 2017, Britain will have an autumn Budget,
announcing tax changes well in advance of the start of the tax year.
From 2018 there will be a Spring Statement, responding to the
forecast from the OBR, but no major fiscal event.
If unexpected changes in the economy require it, then I will,
of course, announce actions at the Spring Statement, but I won’t make
significant changes twice a year just for the sake of it.
This change will also allow for greater Parliamentary scrutiny
of Budget measures ahead of their implementation.
Mr Speaker, this is a long-overdue reform to our tax-policy
making process and brings the UK into line with best practice
recommended by the IMF, IFS, Institute for government and many others.
The OBR report today confirms the underlying strength and
resilience of the British economy….
This Autumn Statement responds to the challenge of building on
that strength, while also heeding the warnings in the OBR’s figures, as
we begin writing this new chapter in our country’s history.
It re-states our commitment to living within our means;
And it sets out our choice to invest in our future.
It sends a clear message to the world that Britain is open for
And it provides help to those who need it now.
So Mr Speaker, we have made our choices.
We have set our course.
We are a great nation.
Bold in our vision.
Confident in our strengths.
And determined in our ambition to build a country that works
I commend this Statement to the House.
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