UK Budget 2020 - Supporting People And Families

11th March 2020

The government is committed to taking action to help with the cost of living for everyone across the UK and ensure that the most vulnerable in society get the support they need.

Alongside the Budget, the government is formally announcing a new, ambitious target for the National Living Wage (NLW) to reach two-thirds of median earnings and be extended to workers

aged 21 and over by 2024, provided economic conditions allow. Based on the latest OBR forecast, this means the NLW is expected to be over £10.50 in 2024.

This builds on the 6.2% increase of the NLW to £8.72 an hour that takes effect from this April, meaning the government is on track to meet its current target of 60% of median earnings by 2020. Since the NLW's introduction in 2016 real wages have grown fastest for the lowest paid full-time workers.

As people earn more, the government is committed to reducing taxes on their wages. The Budget confirms a tax cut for 31 million working people with the increase in the National Insurance contributions (NICs) thresholds for employees and the self-employed, saving the typical employee around £104 and a typical self-employed person around £78 in 2020‑21.

Taken together with increases to the NLW and to the Personal Allowance, an employee working full‑time on the NLW anywhere in the UK will be over £5,200 better off compared to April 2010.

The government is investing a further £9.5 billion in the Affordable Homes Programme which in total will allocate £12.2 billion of grant funding from 2021-22 to support the creation of affordable homes across England.

The government is also helping people with the cost of living by freezing fuel duty for the tenth consecutive year, freezing all alcohol duties, applying a zero rate of VAT to e-publications, abolishing the tampon tax, and making it easier for parents of up to 500,000 school-age children to access Tax-Free Childcare.

The Budget confirms the end of the benefits freeze and continues the rollout of Universal Credit to support the most vulnerable in society, with extra help for parents of sick or premature babies, carers and victims of domestic violence.

The government will invest an additional £1 billion to remove unsafe cladding from residential buildings above 18 metres to ensure people feel safe in their homes.

The Budget also includes action to reduce rough sleeping, providing £643 million for accommodation and support services to help people off the streets.