Chancellor Rachel Reeves delivered the highly anticipated Autumn Budget 2024, marking Labour's first budget in 14 years. Focused on revitalizing public services and economic stability, the budget introduces significant spending commitments, tax reforms, and strategic investments across various sectors.

Major Spending Initiatives:

• NHS and Health Services: An additional £22.6 billion will bolster the NHS, with aims to reduce waiting times through 2 million extra appointments annually*. A further £3.1 billion will support capital infrastructure projects within healthcare**.
• Housing and Infrastructure: £5 billion has been allocated to accelerate housing projects, with Labour pledging to build 1.5 million homes over the parliamentary term*.
• Education: Funding for school breakfast clubs will triple, and special educational needs provision will receive a substantial uplift*.

Tax Reforms:

• Capital Gains Tax (CGT): Rates will rise to 18% for basic-rate and 24% for higher-rate taxpayers*.
• Stamp Duty: The surcharge for second-home buyers and landlords increases from 3% to 5%, aimed at improving housing market fairness*.
• Employer National Insurance: Effective April 2025, employer contributions will increase from 13.8% to 15%, with a reduced threshold of £5,000*.
• Inheritance Tax: Pensions will be included in inheritance tax calculations from 2027, with the nil-rate band freeze extended to 2030*.

Climate and Energy Initiatives:

The budget underscores a commitment to clean energy, focusing on expanding renewable energy infrastructure and nuclear investments**. These measures align with the UK's net-zero targets and aim to create a more sustainable economic foundation**.

Economic Outlook:

The Office for Budget Responsibility (OBR) forecasts short-term growth driven by increased public spending. However, higher taxes and borrowing constraints could slow long-term economic expansion*. Government debt is projected to stabilize, albeit at higher levels than pre-pandemic figures*.

Social Impact:

• State Pension: A 4.1% increase will provide pensioners with an additional £470 annually*.
• Carer’s Allowance: Set for its largest increase since inception, aligning payments with 16 hours at the National Living Wage*.

Conclusion:

The Autumn Budget 2024 reflects Labour’s focus on strengthening public services and addressing economic inequality. While increased spending promises to rejuvenate critical sectors like health and housing, higher taxes could pose challenges for businesses and higher earners. The success of these measures will depend on effective implementation and the government’s ability to balance growth with fiscal responsibility. 

*MoneyWeek: Autumn Budget 2024 Analysis

**Carbon Brief: Climate and Energy Announcements

***House of Lords Library: Autumn Budget Summary