Hammond to offer boost for low paid and housebuilders
The Chancellor will announce £1.4 billion for affordable housing and a 30p an hour increase in the minimum wage to £7.50 from April.
He is likely to confirm plans to invest an extra £2bn a year in science by 2020.
The Office for Budget Responsibility will publish its estimates for the country’s economic growth which are expected to show a slowdown next year. Figures will show the government borrowed a lower-than-expected £4.8bn last month
However, the economy is proving resilient to Brexit pressures and third quarter GDP is expected to expectations of a sharp slowdown to grow 0.5% from 0.7% in the second quarter.
He is expected to announce a £400 Digital Infrastructure Fund to improve the quality and speed of telecoms services delivered to UK businesses and citizens.
In line with Prime Minister Theresa May’s aim to rebalance wealth and improve life for the so-called Jams – those just about managing – Mr Hammond’s proposals will offer support for the lower paid.
Universal Credit – the flagship single payment being rolled out across the UK – will see a reduction in the “taper rate” from 65% to 63%. This means benefits will be withdrawn at a rate of 63p for every pound of net earnings.
This is expected to benefit about three million households across the UK.
Mr Hammond will also confirm previously-announced investments of £1.3 billion on roads and £1 billion on broadband and digital infrastructure, as well as committing billions more to research and development projects designed to support high-skill jobs.
Few are expecting any rabbits to be pulled out of the Chancellor’s hat, although wildcard suggestions include a temporary cut in VAT from 20% to 17.5% and changes to national insurance contributions.
He has been urged to cut air passenger duty and commit to its abolition.
There have been calls for help for Britain’s growing army of micro-businesses, not least from Ed Molyneux, chief executive of newly-floated accountancy software firm FreeAgent. He says they would benefit from simplification of the tax system.
The financial services sector is hoping it gets some relief after years of tax impositions such as higher insurance tax and the bank levy.
There is likely to be an update on the Making Tax Digital programme which will force companies to deliver their numbers to HMRC digitally.
Calls have been made for a delay to allow smaller firms to be ready for the switchover.