Autumn Budget and Spending Review 2021: key policy measures

October 27, 2021

Local Government Lawyer highlights some of the key measures in the Budget and Spending Review 2021 unveiled by Chancellor of the Exchequer Rishi Sunak.

Source: Autumn Budget and Spending Review 2021, HM Treasury

To find out how Rishi Sunak's announcements have been received, go to Autumn Budget and Spending Review 2021: reaction from the sector.

Local Government Finance

There will be a multi-year settlement to enable local authorities to support the ambition to level up communities across the country, with an estimated average real-terms increase of 3% a year in core spending power. “This is the largest sustained rise in core spending power in more than a decade, building on year-on-year real-terms increases for local government since SR19.”
English councils will be provided with £1.6 billion of new grant funding in each of the next three years, on top of the funding to implement social care reform. “This funding ensures the government can reform social care, increase investment in supporting vulnerable children and enable local authorities to continue to provide the other local services that people rely on.”

Adult Social Care

The new Health and Social Care Levy, along with an increase to the rates of dividend tax, will raise around £13 bn per year for spending on health and social care across the UK. “This enables significant further funding for the NHS, for the government’s reforms to social care, public health and prevention programmes, and investment in training the workforce of the future.
£2.1 billion will be made avaliable over the next three years to support innovative use of digital technology “so hospitals and other care organisations are as connected and efficient as possible, freeing up valuable NHS staff time and ensuring the best care for patients wherever they are”.

Education

Confirmation of an additional £4.7 billion by 2024-25 for the core schools budget in England, over and above the SR19 settlement for schools in 2022-23, as well as £2.6 billion of capital funding for new school places for children with special educational needs and disabilities, and £1.8 billion of additional money for education recovery – in addition to the £1.4 billion announced in June 2021.
New investment of £1.6 billion for 16–19-year olds’ education in England. “This will maintain funding in the face of demographic growth and provide additional hours for learners who take T Levels.”

Housing, Planning, Property

There will be an additional £1.8 billion for housing supply, to deliver £10 billion investment since the start of this Parliament and unlock over 1 million new homes over the SR21 period and beyond. “This includes £300 million locally-led grant funding that will be distributed to Mayoral Combined Authorities and Local Authorities to unlock smaller brownfield sites for housing and improve communities in line with their priorities, and £1.5 billion to regenerate underused land and deliver transport links and community facilities, unlocking 160,000 homes in total.”
Confirmation of an investment of £11.5 billion in the Affordable Homes Programme in England from 2021-26 to help build up to 180,000 new affordable homes – with 65% of funding for homes outside London.
Confirmation of the commitment to grant funding of over £5 billion to remove unsafe cladding from the highest-risk buildings, supported by revenues raised from the new Residential Property Developer Tax.
Additional £639 million resource funding per annum by 2024-25 as part of the government’s commitment to end rough sleeping in England, an 85% cash increase compared to 2019-20. This brings total funding to £1.9 billion resource and £109 million capital investment over the SR21 period. This will amongst other things mean continued funding for the Rough Sleeping Initiative; and completion of the delivery of 6,000 homes under the Rough Sleeping Accommodation Programme.
An additional £65 million investment to improve the planning regime, through a new digital system “which will ensure more certainty and better outcomes for the environment, growth and quality of design”.
Following a review, the government will reduce the burden of business rates in England by over £7 billion over the next five years, “and make the system fairer, more responsive and more supportive of investment.”

Asylum and Refugee Support

Therew willb be funding for the UK’s commitment to welcome up to 20,000 Afghan citizens over the coming years, including £20,520 per person for local authorities who settle Afghan families, with an additional £17 million available to top-up housing costs and an extra £20 million pot of flexible funding.
An additional £458 million by 2024-25 for asylum and refugee support, helping protect vulnerable people in our asylum system.

Justice

There will be an almost £650 million in additional funding by 2024-25 to manage an expected increase in the number of offenders being brought to justice following a rise in the number of police officers; and almost £500 million over the next three years to address the courts backlog and start to reduce the waiting times caused by COVID-19.
Increasing annual funding for Ministry of Justice’s victims support services to over £185 million a year by 2024/25. £355 million to keep people safe, cut crime and help victims of sexual abuse in England and Wales, including £50 million towards the Safer Streets Fund helping it continue its vital role in working with police forces in local crime-prevention.
Additional funding will be given to increase the thresholds for means-tested legal aid, to expand access to justice to those who cannot afford it and increase the capacity of the civil legal aid sector. “As a result, millions more people could be eligible for legal aid at the magistrates’ court and for civil legal aid. It will also invest in the sustainability of the civil legal aid market, along with other potential changes to criminal legal aid.”

Licensing

The Alcohol Duty system will undergo a major simplification, “overhauling an outdated system full of historical anomalies”. Drinks will be taxed in proportion to their alcohol content, “making the system fairer and more conducive to product innovation in response to evolving consumer tastes”. The number of main rates will be reduced from 15 to 6.
Alcohol will be taxed in a progressive manner, “ensuring higher strength products incur proportionately more duty, addressing the problem of harmful high-strength products being sold too cheaply”.
A new relief will be introduced that recognises the importance of pubs and supports responsible drinking will be introduced, with duty rates on draft beer and cider being cut by 5%.
There will be a new, temporary 50% business rates discount for businesses in the retail, hospitality, and leisure sectors in England. “This will provide support until the next revaluation, helping the businesses that make UK high streets and town centres successful evolve and adapt to changing consumer demands. Apart from reliefs in response to COVID-19, this is the biggest single-year cut to business rates in 30 years.”

Levelling Up, Projects

There will be over £2.6 billion for the UK Shared Prosperity Fund over the Spending Review, “focused on helping people into jobs and get on in life across the UK”. The Fund will at a minimum match the size of EU Funds in all nations, each year. The Government will also match current EU funding levels in Cornwall.
£560 million new funding for youth services in England over the next three years, “enough to fund 300 youth clubs”.
£205 million new funding to build or transform up to 8,000 state-of-the-art community football pitches across the UK.
Allocation of the first round of the UK-wide Levelling Up Fund with £1.7 billion of local investment in local areas, “ranging from redeveloping Inverness Castle to upgrading the ferry to the Isles of Scilly, and from a bowling green in Portrush to a science lab in Peterborough”.
Allocation of the first 21 projects to benefit from the £150 million Community Ownership Fund, “which will help communities across the UK protect and manage their most treasured assets, from building the John Jenkins Stadium in Portsmouth to acquiring the Old Town Hall as part of a new museum development in Whithorn in Scotland, supporting the Ty’n Llan pub in Llandwrog in Wales, and developing a new community digital hub in Cushendall in Northern Ireland”.
£850m to protect museums, galleries, libraries, and local culture in England.
The first Freeport tax sites will be in Humber, Teesside and Thames, and those Freeports will be able to begin initial operations from November.
Accelerated funding for the Cardiff City Region Deal to fast-track support, including for advanced manufacturing capability in the region.

Transport

£6.1 billion to back the Transport Decarbonisation Plan, “boosting the number of zero emission vehicles, helping to develop greener planes and ships, and encouraging more trips by bus, bicycle and foot”.
£3.9 billion to decarbonise buildings, including £1.8 billion to support “tens of thousands of low-income households to make the transition to net zero while reducing their energy bills”.
£2.6bn between 2020-2025 for a new, long-term pipeline of over 50 local road upgrades in England.
More than £5 billion for local roads maintenance, “enough to fill millions of potholes a year”.
£5.7 billion to eight English city regions over five years to transform local transport networks through London-style integrated settlements.
£3 billion investment over this Parliament to level up bus services in England, including a new dedicated £1.2 billion new funding for London-style bus transformation deals to improve infrastructure, fares and services.
£355 new funding for zero emission buses, and an allocation of £70 million Zero Emission Bus funding to deliver buses and related infrastructure in Warrington, Leicester, Milton Keynes, Kent, and Cambridgeshire & Peterborough.