UK Prime Minister Rishi Sunak and Chancellor Jeremy Hunt staked their future on a budget on Thursday that was all pain and only offered a glimpse of any gains.
With inflation above 11 per cent, the autumn statement was expected to impose tax rises and spending cuts to tackle the economic black hole facing the country. Mr Hunt said his main themes were stability, growth and public services. He said the country's woes were compounded by a rise in energy prices to eight times their historic average.
As people face skyrocketing bills, Mr Hunt said it was a “made in Russia energy crisis”. He said fiscal and monetary policy would work together, backing the Bank of England's independence and scope to raise interest rates.
He said the economy was now in recession and that growth would not return until 2024
Taxes
Income taxes
People will pay a 45p tax rate at £125,000, down from £150,000, and thresholds for all levels of income tax will be frozen until April 2028. One way to increase the tax paid is to push more people into higher tax brackets.
A freeze on the thresholds for income tax means more people fall above the tax threshold, as annual pay rises kick in over the next few months.
Windfall taxes
Electricity generation and exploration companies working in the North Sea also face higher taxes with the windfall rate raised to 35 per cent from 25 per cent. It is now expected to raise an average of £8.0 billion a year over four years, up from £5.5 billion a year
Profits this year have risen as energy have prices spiked on the back of the war in Ukraine and cost-of-living increases.
Mr Hunt is bringing in a 45 per cent tax on electricity generation from January 1.
The combined revenue increase is expected to be £14 billion.
Borrowing
The UK is to borrow 7.1 per cent of gross domestic product (GDP) this year, or £177 billion, up from the Office of Budget Responsibility (OBR) forecast of a deficit of 3.9 per cent of GDP, or about £98 billion.
Next year, the UK expects to borrow £140 billion or 5.5 per cent of GDP — again up from the 1.9 per cent or £50.4 billion predicted in March.
According to the Office of Budget Responsibility this has a substantial impact. "The Autumn Statement lowers borrowing by progressively larger amounts rising to £61.7 billion (2.1 per cent of GDP) in 2027-28. Net tax rises account for half of this tightening (£31.0 billion), with £19.4 billion coming from cuts to departmental current spending and £11.8 billion from cuts to departmental capital spending."
Capital gains tax
A tax that more often falls on the wealthier, it is the tax paid when an asset, such as shares or a second home, is sold.
Exemptions have been more than halved to £6,000 annually and will then drop again to £3,000 in successive years.
Dividend exemptions are also cut to £1,000 from next year and then will fall to £500 a year later.
Council tax
Council tax rules were changed, allowing local authorities the chance to make steeper increases.
For the average householder, council tax is expected to rise to more than £2,000. In the most expensive homes, it could be double that.
Current rules say councils need to hold a referendum if they want to raise the tax by more than 3 per cent, but that is expected to change and become as high as 5 per cent.
Spending cuts
The Chancellor is looking at filling about half of the £55 billion budget shortfall with a freeze in public spending for government departments.
It would set spending plans for three years that mean cuts in real terms and in services.
Health and social care
The introduction of a health and social care levy is postponed for two years despite a group of charities warning that the NHS and social care system are in the “most perilous position in memory”.
And a survey by the Association of Directors of Adult Social Services found 94 per cent of members said they did not have sufficient funding to meet the costs of care over the winter.
Council tax rises are likely to be the way social care is funded.
Education
The budget for schools is to rise by £2.3 billion in each of the next two years, taking total core spending to £58.8 billion every year.
Energy demand
The government announced energy efficiency plans and the launch of a task force to drive a 15 per cent reduction in demand by 2030. Mr Hunt said £6 billion in funding would be set aside to achieve this target.
Stamp duty
A reverse of the stamp duty cut was announced after 2025, unpicking one of the few measures in the Liz Truss-Kwasi Kwarteng mini-budget to survive.
There are new signs that the housing market is showing signs of weakness after the Bank of England raised interest rates and the number of mortgage approvals have reduced.
Defence
The defence budget is expected to rise but only after an Integrated Review overhaul is completed and delivered to the Chancellor. For now, the government remains committed to keeping defence spending at 2 per cent of GDP. On foreign aid, spending will not come back up to 0.7 per cent of national wealth but the government hopes to keep the level at 0.5 per cent.
Social support
Pensions
The triple lock, a guarantee that the state pension would rise by the highest out of inflation, earnings or by 2.5 per cent, was protected.
Mr Hunt said pension credits would increase by more than 10 per cent. There would be an £870 increase in the state pension from April.
Minimum wage
Expect a significant rise in the national living wage — potentially up nearly 10 per cent — but even that would be lower than inflation.
The national living wage rise could go from £9.50 an hour to about £10.42 an hour
The government is also looking at cost-of-living payments worth up to £900 to about eight million households.
Energy bills
Mr Hunt said the energy price guarantee would continue after April for a further 12 months at a higher household rate of £3000.
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
Red flags
- Promises of high, fixed or 'guaranteed' returns.
- Unregulated structured products or complex investments often used to bypass traditional safeguards.
- Lack of clear information, vague language, no access to audited financials.
- Overseas companies targeting investors in other jurisdictions - this can make legal recovery difficult.
- Hard-selling tactics - creating urgency, offering 'exclusive' deals.
Courtesy: Carol Glynn, founder of Conscious Finance Coaching
Liverpool’s fixtures until end of 2019
Saturday, November 30, Brighton (h)
Wednesday, December 4, Everton (h)
Saturday, December 7, Bournemouth (a)
Tuesday, December 10, Salzburg (a) CL
Saturday, December 14, Watford (h)
Tuesday, December 17, Aston Villa (a) League Cup
Wednesday, December 18, Club World Cup in Qatar
Saturday, December 21, Club World Cup in Qatar
Thursday, December 26, Leicester (a)
Sunday, December 29, Wolves (h)
Super 30
Produced: Sajid Nadiadwala and Phantom Productions
Directed: Vikas Bahl
Cast: Hrithik Roshan, Pankaj Tripathi, Aditya Srivastav, Mrinal Thakur
Rating: 3.5 /5
THE BIO
Favourite author - Paulo Coelho
Favourite holiday destination - Cuba
New York Times or Jordan Times? NYT is a school and JT was my practice field
Role model - My Grandfather
Dream interviewee - Che Guevara
The specs
Engine: 1.5-litre, 4-cylinder turbo
Transmission: CVT
Power: 170bhp
Torque: 220Nm
Price: Dh98,900
More on Palestine-Israeli relations
Other must-tries
Tomato and walnut salad
A lesson in simple, seasonal eating. Wedges of tomato, chunks of cucumber, thinly sliced red onion, coriander or parsley leaves, and perhaps some fresh dill are drizzled with a crushed walnut and garlic dressing. Do consider yourself warned: if you eat this salad in Georgia during the summer months, the tomatoes will be so ripe and flavourful that every tomato you eat from that day forth will taste lacklustre in comparison.
Badrijani nigvzit
A delicious vegetarian snack or starter. It consists of thinly sliced, fried then cooled aubergine smothered with a thick and creamy walnut sauce and folded or rolled. Take note, even though it seems like you should be able to pick these morsels up with your hands, they’re not as durable as they look. A knife and fork is the way to go.
Pkhali
This healthy little dish (a nice antidote to the khachapuri) is usually made with steamed then chopped cabbage, spinach, beetroot or green beans, combined with walnuts, garlic and herbs to make a vegetable pâté or paste. The mix is then often formed into rounds, chilled in the fridge and topped with pomegranate seeds before being served.
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
The biog
Name: Abeer Al Shahi
Emirate: Sharjah – Khor Fakkan
Education: Master’s degree in special education, preparing for a PhD in philosophy.
Favourite activities: Bungee jumping
Favourite quote: “My people and I will not settle for anything less than first place” – Sheikh Mohammed bin Rashid.
Mina Cup winners
Under 12 – Minerva Academy
Under 14 – Unam Pumas
Under 16 – Fursan Hispania
Under 18 – Madenat
MATCH INFO
Syria v Australia
2018 World Cup qualifying: Asia fourth round play-off first leg
Venue: Hang Jebat Stadium (Malacca, Malayisa)
Kick-off: Thursday, 4.30pm (UAE)
Watch: beIN Sports HD
* Second leg in Australia scheduled for October 10
The biog
Favourite colour: Brown
Favourite Movie: Resident Evil
Hobbies: Painting, Cooking, Imitating Voices
Favourite food: Pizza
Trivia: Was the voice of three characters in the Emirati animation, Shaabiyat Al Cartoon
Jebel Ali results
2pm: Handicap (PA) Dh 50,000 (Dirt) 1,400m
Winner: AF Al Moreeb, Antonio Fresu (jockey), Ernst Oertel (trainer)
2.30pm: Maiden (TB) Dh 60,000 (D) 1,400m
Winner: Shamikh, Ryan Curatolo, Nicholas Bachalard
3pm: Handicap (TB) Dh 64,000 (D) 1,600m
Winner: One Vision, Connor Beasley, Ali Rashid Al Raihe
3.30pm: Conditions (TB) Dh 100,000 (D) 1,600m
Winner: Gabr, Sam Hitchcott, Doug Watson
4pm: Handicap (TB) Dh 96,000 (D) 1,800m
Winner: Just A Penny, Sam Hitchcock, Doug Watson
4.30pm: Maiden (TB) Dh 60,000 (D) 1,600m
Winner: Torno Subito, Sam Hitchcock, Doug Watson
5pm: Handicap (TB) Dh 76,000 (D) 1,950m
Winner: Untold Secret, Jose Santiago, Salem bin Ghadayer
MATCH INFO
What: 2006 World Cup quarter-final
When: July 1
Where: Gelsenkirchen Stadium, Gelsenkirchen, Germany
Result:
England 0 Portugal 0
(Portugal win 3-1 on penalties)
TEACHERS' PAY - WHAT YOU NEED TO KNOW
Pay varies significantly depending on the school, its rating and the curriculum. Here's a rough guide as of January 2021:
- top end schools tend to pay Dh16,000-17,000 a month - plus a monthly housing allowance of up to Dh6,000. These tend to be British curriculum schools rated 'outstanding' or 'very good', followed by American schools
- average salary across curriculums and skill levels is about Dh10,000, recruiters say
- it is becoming more common for schools to provide accommodation, sometimes in an apartment block with other teachers, rather than hand teachers a cash housing allowance
- some strong performing schools have cut back on salaries since the pandemic began, sometimes offering Dh16,000 including the housing allowance, which reflects the slump in rental costs, and sheer demand for jobs
- maths and science teachers are most in demand and some schools will pay up to Dh3,000 more than other teachers in recognition of their technical skills
- at the other end of the market, teachers in some Indian schools, where fees are lower and competition among applicants is intense, can be paid as low as Dh3,000 per month
- in Indian schools, it has also become common for teachers to share residential accommodation, living in a block with colleagues
The UAE's journey to space
Fixtures
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