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Full reaction to Budget 2021

Leading figures from across local government, the third sector and business have delivered their verdict on Rishi Sunak’s March 2021 Budget.

Nigel Wilcock, executive director at Institute of Economic Development

‘In today’s budget all Ben Houchen’s Christmases came at once. With the relocation of a government super-campus to Darlington, funds for new port infrastructure on Teesside, and freeport status the area was undoubtedly the big winner. The country was sprinkled with a few small prizes in the name of levelling up – and the eponymous fund will also be scrutinised carefully – but in truth, if this budget is to create the investment drive that is hoped for it will not be these incremental measures that make the largest impact. It will be whether UK business has the confidence to take advantage of the 130% capital allowances that will be on offer in the near term. How business will react is unclear since it is then business who will pay the biggest price in making contributions to address the deficit. The steep rise in corporation tax was the first bitter pill in the Covid financial recovery plan but there will need to be more to follow.’

 

David Hutton, partner and head of local government at national law firm Bevan Brittan

‘While it seems there will be no immediate help for councils with pressures on their revenue budgets (and no mention of social care), it was encouraging to hear more details on previous announcements from the Chancellor that will help councils with capital projects and local investment into infrastructure. As councils look to facilitate the growth of their towns and cities and re-imagine future needs arising from climate; changes in the future of work; retail and community spaces, more Town Funds and the launch of the Levelling Up Fund plus the National Infrastructure Bank may be supporting factors provided monies can flow quickly and minimise repeated applications to Government for pots of money. However, unless there is a way to accelerate these capital schemes, they will take years to deliver and may leave communities questioning whether levelling up is happening. We await the National Infrastructure Commission Towns and Regeneration with interest.’

Helen Barnard, director of the Joseph Rowntree Foundation

‘It is unacceptable that the chancellor has decided to cut the incomes of millions of families by £1,040-a-year in six months’ time. He said this Budget would “meet the moment” but this decision creates a perfect storm for the end of this year, withthe main rate of unemployment support cut to its lowest level in real terms since 1990 just as furlough ends and job losses are expected to peak. This makes no sense and will pull hundreds of thousands more people into poverty as we head into winter.

‘Even before Coronavirus, incomes were falling fastest for people with the lowest incomes due in large part to benefit cuts. Ministers know this short extension offers little relief or reassurance to the millions of families, both in and out-of-work, for whom this £20-a-week is helping to stay afloat. This cut to Universal Credit will increase hardship when the economic crisis is far from over and undermine our national road to recovery.’

Judith Cavanagh, coordinator of the End Child Poverty coalition

‘The uncomfortable reality is that the end of the pandemic will not herald an end to child poverty. Today’s decision to extend the £20 Universal Credit demonstrates the Chancellor understands the importance of social security for low income families. However, we are disappointed that he has not taken the chance to invest in children and make this permanent, and has forgotten those children in families in receipt of legacy benefits.’

 

Jonathan Carr-West, chief executive of LGIU

‘The chancellor’s Budget has fallen short when it comes to what councils up and down the country desperately need to help their communities out of this pandemic. While everyone’s attention has been on Covid-19, no strategic progress has been made on any of the key issues that matter to councils, even as they get progressively worse. No social care green paper, no Fair Funding Review, no business rate retention scheme, no devolution white paper. The state of local government finances is not only unsustainable it is failing fast. Our survey of those leading across local government has shown this time and time again.

‘All these problems have been decades in the making with councils left to pick up the pieces, all while operating in conditions of deep uncertainty. And as councils across the country set their budgets on the basis of another ad hoc one year financial settlement, these uncertainties make their job even harder.’

Cllr David Williams, chairman of the County Councils Network

‘This Budget understandably focuses on the ongoing pandemic and economic recovery efforts. We are pleased that the government has listened to the County Councils Network and has acknowledged the strategic role of county authorities in helping to drive growth and recovery through their lead role in delivering the new UK Community Renewal Fund and in bidding for key projects through the Levelling Up Fund. Counties will put forward ambitious proposals, working with local partners.

‘Other economic support, such as an extension to the furlough scheme, grants for businesses, new infrastructure bank and next round of Town Deals are all welcome. England’s counties are particularly vulnerable, with over half of their workforce in jobs at risk of widespread closures so it is crucial that this funding is quickly distributed to those sectors and individuals, and the possibility of more support if needed is kept on the table.’

 

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