Workers in Sussex are set to benefit from the introduction of a £9 an hour national ‘Living Wage’ by 2020.
In today’s Budget Chancellor George Osborne announced that from next April the current £6.50 an hour Minimum Wage would be replaced by a compulsory £7.20 an hour Living Wage for the over 25s, which would rise to £9 by 2020.
But union GMB said it represented a ‘beautifully crafted con trick’ and while welcoming the Living Wage argued that working families would also be hit by cuts to tax credits.
The Country Land and Business Association (CLA), which represents landowners, farmers and rural businesses, raised concerns that the Living Wage would be a major blow to rural family businesses.
Robin Edwards, CLA South East regional director, said: “As a result of this budget farmers and other rural businesses are presented with significant inflation in their wage costs and the cut in corporation tax that is supposed to pay for it will not benefit them. We now need an urgent plan for how to ensure rural businesses are not left behind and jobs in rural communities are not put at risk.
“The Chancellor stated in the Budget that the new compulsory national Living Wage will be paid for by decreases in corporation tax. There are hundreds of thousands of family businesses in rural England and Wales that are unincorporated and therefore are taxed on higher tax rates.”
The Federation of Small Businesses said that while the move would be offset by a ‘welcome’ increase in employment allowance, some of its members would find the new Living Wage ‘challenging’.
Meanwhile UNISON South East felt that proposed cuts to in work benefits, pay restraint for public sector workers and further reductions in funding for local government would ‘further deepen the wounds of an already hurting public sector’.
But Mr Osborne said: “My budget today puts security first. It delivers economic security so Britain lives within its means, financial security for families, and national security for all.
“A new national Living Wage for 330,000 people, and an income tax cut for millions more provides new support for people right across London and the South East.
“At the heart of our plans our commitments to improve infrastructure, education, skills and culture.
“This is a Budget that delivers on our plan for working people in London and the South East.”
Some of the other announcements in the Budget were welcomed by other organisations.
Ian Patterson, area director SME Banking for Lloyds Bank Commercial Banking in the South East, said: “Today’s Budget announcement has seen further support announced for small and medium firms in the South East, encouraging them to invest and, in turn, bolster the region’s economy.
“Plans to further reduce corporation tax mean that businesses will be well placed to expand, target new growth opportunities and create new jobs.”
The Taxpayers’ Alliance said that changes to income tax thresholds, corporation tax, and inheritance tax all represented a ‘tentative step in the right direction’.
On the inheritance tax threshold rise Vince McLoughlin, a partner at Steyning-based business and tax advisers Russell New, said: “By announcing that the threshold will be raised, middle-class families who are not mega-rich should be able to leave their house to their children without having 40 per cent taken off the value.”
Helen Meese, head of engineering in society at the Institution of Mechanical Engineers, added: “There are some welcome proposals in this Budget, but Government needs to go much further if it wants to secure the country’s skills, economy and NHS.
“The introduction of the revised Vehicles Emissions Duty will help secure a sustainable method to fund the UK’s road network, the increase in the Annual Investment Allowance is a welcome legislation for SMEs and plans to increase the number of apprenticeships by 3 million via a levy to large companies could also help boost skills.
“However there is a need for Government to show clearly how it will ensure that these apprenticeships will meet the high standards needed in engineering. The Government should also look at ways companies can use this apprenticeship levy to support their supply chain and SMEs.”
What do you think of the Budget? Leave a comment below.
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