The Budget: coronavirus crisis and infrastructure at the heart of Government planning and spending
12 March 2020
In both his and the new Government’s first Budget yesterday, Chancellor Rishi Sunak outlined a £30 billion package to help individuals and businesses combat the current and potential future economic effects of the COVID-19 pandemic, including a minimum £5 billion NHS Emergency Response Fund. He also pledged a public investment programme of £600 billion over the next five years - the highest level of public spending ‘in real terms’ since 1955.
While some of the spending measures had previously been announced, other policy decisions will be delayed until later this year following the Government’s comprehensive spending review, partly due to the ongoing concerns surrounding coronavirus.
Several announcements are of particular relevance to the workplace and facilities management profession.
- A new £1 billion Building Safety Fund to support the fire safety remediation programme following the Grenfell tragedy to remove all unsafe materials from residential buildings (including private and social housing) above 18 metres.
Apprenticeships, Skills & Education
- A review of the Apprenticeship Levy to support employers in meeting the long-term skills needs of the economy. In the meantime, Government will ensure that sufficient funding is made available in 2020-21 to support an increase in the number of apprenticeships in small and medium-sized businesses
- New higher National Minimum Wage and National Living Wage rates from next month and a new remit for the Low Pay Commission to increase rates to two-thirds of median earnings by 2024 ‘provided economic conditions allow’
- A consultation on how to use the new £2.5 billion National Skills Fund to improve the technical skills of adults across the country
- £120 million to bring further education and higher education providers in England together with employers to open up eight new Institutes of Technology
- £1.5 billion for further education capital investment over the next five years, £95 million for providers in England to invest in facilities and industry-standard equipment to support the rollout of T levels, and funding for 11 maths schools across the UK.
Sustainability & Environment
- Government to legislate for a carbon emissions tax as an alternative carbon pricing policy and will consult on the design of the tax in spring 2020
- A Green Gas Levy to help fund the use of greener fuels for heating homes and other buildings; from 2022, an increase in the Climate Change Levy that businesses pay on gas; and a consultation on extending the Climate Change Agreement scheme, which incentivises energy intensive businesses to improve their energy efficiency
- A consultation on introducing a new grant scheme in 2022 to help households and small businesses invest in heat pumps and biomass boilers, backed by £100 million of new funding
- A review of the electric vehicle charging infrastructure covering the full road network with £500 million for additional chargepoints; a new call for evidence on how vehicle excise duty can be used to further encourage uptake of zero and ultra-low emission cars
- A new tax of £200 per tonne on plastic with less than 30% recycled material is to be introduced from 2022.
- The Government is reviewing the Public Sector Value Framework and is seeking to improve the efficiency and performance of its contract arrangements through upskilling key staff
- A consultation is to be launched shortly on strengthening the powers of the Small Business Commissioner in resolving payment disputes.
- £5 billion on the rollout of gigabyte broadband across the UK, plus £510 million on improving the shared rural mobile network
- The NHS Funding Settlement to be increased by £6 billion over five years, including funding for 40 new hospitals.
Commenting on the Budget, IWFM’s Head of Policy Sofie Hooper said: 'We recognise that this Budget has come at a time of great economic and public uncertainty and look forward to further Government announcements on issues affecting our profession.
'In particular, we welcome the ambitious new remit of the Low Pay Commission, although as a Living Wage Employer we would encourage our members to pay all their staff the real Living Wage and will be publishing new guidance on this in the next few weeks.
'Record investment in infrastructure and additional funding in skills should help to boost the UK’s economy and productivity levels, but with existing skills shortages in many sectors - including construction and facilities management - coupled with the Government’s proposed clampdown on low-skilled immigration after we leave the EU, we question whether there will be the workforce not just to see projects through to completion, but also to run, maintain and service the new buildings and facilities created.'