spring budget 2024

Spring Budget 2024 – What does HR need to know?

Spring Budget 2024 – What does HR need to know?

The Chancellor, Jeremy Hunt announced the Spring Budget yesterday (6th March). We have provided a round-up of the key areas from the Budget that employers and HR should be aware of.

Further cuts to national insurance

Following on from the 2p cut in the Autumn Statement, a further cut to national insurance was announced. Employee national insurance contribution will be cut by 2p, from 10 per cent to 8 per cent of pay. Those who are self-employed will also see a reduction, from the current 8 per cent to 6 per cent. The new rate will come into effect from 6th April 2024.

Pension reforms

Pension funds will have to publicly share and compare their performance data to competitor schemes. The schemes that are performing poorly will not be able to take on new business from employers.

Further support for working parents

To help an extra 60,000 working parents, Hunt plans to extend the 30 hours of free childcare to children over the age of nine months. Currently, if your child is 2 years old you can get 15 hours free childcare and if they are 3-4 years old, you can get 30 hours free childcare. This change in affordable childcare will help to encourage and support mothers to return to work.

Changes to how child benefit is paid were announced to make it fairer for single-income families. At the moment, a household with two working parents with an annual income of £49,000 each will receive child benefits in full. However, a household with one parent with an annual income of over £50,000 would see a reduction in their child benefit entitlement (High Income Child Benefit Charge).

The government plans to address this ‘unfairness’ by moving this to a household-based system. They plan to introduce this by 6th April 2026. Until then though, from 6th April 2024, the lower income threshold of £50,000 for when parents start paying the high-income child benefit charge (HICBC) will increase by £10,000 to £60,000. This change will result in 170,000 families not having to pay the charge altogether. The Upper Income Threshold of £60,000 will also increase to £80,000.

Help to get more people into work

Extra funding will be provided to support the processing of disability benefit claims. The extra funding will improve the capability of the system to meet the increased demand so that people receive access to this support in a timely manner.

It was also decided that the Additional Jobcentre Support pilot that has been in place across England and Scotland will be extended for another 12 months. This initiative was set up to test how effective intensive support at specific points in a universal credit claimant’s journey can be to help them secure employment or higher earnings.

To find out more information or if you require any advice surrounding the Spring Budget 2024 get in contact with our team of experts.

T: 0330 107 1037

E: contact@hpc.uk.com

LinkedIn: High Performance Consultancy

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