The focus of the Spring Budget (delivered by Chancellor Jeremy Hunt on 15th March 2023) mainly consisted of getting Britain “back to work” and therefore raised significant aspects for employers and HR professionals to consider. To help understand the changes, we have summarised the main points of the Spring Budget in relation to employment.
Announcement of new universal support scheme to help disabled people to work
An employment scheme for those with health conditions and people with disabilities will be funded within England and Wales. The aim of this is to aid people in finding suitable roles that cater to their ability. The government will fund up to £4,000.00 per person and aim to invest in 50,000 people annually.
Since COVID-19, a shift in the working culture has created models where it is the norm to work from home, an unintentional consequence, which many with disabilities or learning difficulties will benefit from. We encourage employers to start reviewing the measures in place to ensure accessibility and inclusivity for all types. Employers should also start to look at potential implementations that could benefit a variety of groups as well as individual needs.
Occupational health support designed to keep people working
There is a £406 million plan in place to help people with health issues, particularly mental health, musculoskeletal and cardiovascular conditions. Parts of the plan include bringing two new consultations to improve access to instant support if required and to double the funding for SMEs in relation to this.
Employers should consider how they are able to support their employees regarding this, with a keen focus on over 50s, as they are the group most likely to benefit from the above.
“Returnerships”: apprenticeships for over 50’s
To attract the older workforce back, the government is launching apprenticeships for over 50’s: “returnerships”. The aim of this scheme is to make new and existing skills more accessible to all ages and will focus on providing flexibility for a path back into employment.
For employers, it will be important to assess the type of contract, benefits and pay that returners will receive if they were to take part in the scheme. It has also been suggested that employers should understand that the wants of returners will be different to apprentices, for example they may need more flexible working hours or private healthcare.
Lowering pensions tax
To encourage people to stay in work, there will be an increase in the pensions tax-free annual allowance from £40,000.00 to £60,000.00 and the life-time allowance charge will be scrapped completely. The removal of the life-time allowance charge is positive for employers as well as employees as it will save significant admin costs.
Raising corporation tax to push investment
In April 2023, there will be a rise in corporation tax from 19% to 25% for companies making more than £250,000.00. Employers need to take this tax increase into consideration as it is predicted that there will be a short term hit in hiring and recruitment until corporates adjust.
Increase in childcare support for parents
There will be phased changes, with the aim ofworking parents being able to access 30 hours of free childcare for every child over nine months by September 2025.
The phases consist of:
- April 2024: 15 hours of free childcare for working parents of two-year-olds.
- September 2024: 15 hours of free childcare for working parents of children aged nine months to three years.
This is positive news for employers, given how it supports the retainment of skilled individuals by allowing them to return to work earlier than would have been possible prior to the support.
If you would like further advice about changes for employment law, following the Spring Budget, contact the employment team at [email protected] to see how they can help you.
For more employment law updates, check out our other articles!