Today’s spring statement 2022 was not intended to be a major fiscal event – big spending announcements were not expected until this autumn’s full budget.
But a rapidly escalating energy crisis was worsened by the impact of Russia’s invasion. Ukraine has put pressure on Rishi Sunak to act.
The cost of energy for households is expected to increase by thousands of pounds this year. Rising to PS4,000 by the end of October according to the banking group Investec. This will contribute to an increased cost of living problem. As the public is preparing for the next National insurance increase and inflation accelerating to the eye-watering amount of 8%.
Today, The Office for National Statistics announced the rate of inflation for consumer prices. Which is a measure of what is the price of living experienced by households has risen to 6.2% in the year up to February. Exceeding expectations and higher than 5.5% at the beginning of the year. This was the highest level in thirty years. Rising energy costs were the driving factor for the increase, according to the ONS confirmed.
The industry is also stressed by the rising prices for energy that are translating into higher prices for essential products like bricks and steel.
what to look out for
The chancellor has indicated that he’ll step in to help, but with the public’s coffers ravaged through two consecutive years of emergency. Pandemic assistance measures his options are very limited. Sunak could be beginning to regret the phrase which he’s been often associated with since announcing his furlough plan two years ago today: “whatever it takes”.
Sunak is likely to reject demands from Tory MPs to rescind plans to increase the national insurance contribution for employees and employers from next month. The funds will be used to tackle health care backlogs as well as to fund an overhaul of the social health system.
He’ll instead raise the rate at which people begin to pay national insurance to ensure the households with the lowest incomes aren’t burdened by the social and health care tax.
The economic crisis could open an opportunity for construction However this adds urgency to the necessity of making our homes more efficient in energy use and a cause those numerous professionals have been advocating for over the years. Energy-related projects are also being debated by the government and maybe in the pipeline today.
Here are some of the points to watch out for:
Cheap loans for energy efficiency projects
Sunak has advised the new infrastructure bank of the government to utilize a portion part of the PS22bn of cash to fund projects to retrofit homes According to The Times. The Times. The newspaper reported that the move would allow high-street banks to provide low-cost loans to homeowners who want to purchase solar panels, heat pumps as well as other energy-efficient measures.
The bank, which is wholly owned by the Treasury, was opened in June last year and is chaired by former British Land chief executive Chris Grigg. It was intended to focus on transport projects and other public infrastructure schemes, not housing. But Sunak has said that projects which increase the UK’s energy security. Including retrofits, are within the scope of the bank’s remit.
New power sources
Boris Johnson has launched a campaign to “rapidly accelerate” new nuclear projects according to the newspaper Number 10. Boris Johnson met with the leaders of the construction. Nuclear sectors on Monday to brainstorm ways to eliminate obstacles. To the development of new projects to enable reactors to be operating more quickly and easily.
The minister said that the government is looking to have a “thriving pipeline” of nuclear power projects. The report claims that the minister has informed the group that he would like nuclear power to comprise 25% of the country’s energy consumption in 2050. With electricity demand expected to rise by 20% over the next 30 years. Which would mean that a lot of important nuclear projects will be required.
However, with business secretary Kwasi Kwarteng declaring the imminent removal of all Russian imports of gas and oil to the UK as well as the need for new energy sources, alternatives are expected to be found in the coming months. Be on the lookout for ways in the way that the government will approach this issue. It could be an increase in the flow into North Sea gas. Or potential fast-tracked energy projects in Sunak’s “project acceleration” initiative.
Cut in fuel duty
There has been widespread speculation that Sunak is planning to cut fuel duty for the first time in the past 11 years. It is a tax that earns about PS27bn every year was frozen in 2011. But Sunak is being pressured to give some relief from rising expenses.
The measure is likely to last only a few days and maybe changed if the global oil market stabilizes. It could also be in contradiction against the net-zero pledges of the federal government.
This move could signal the beginning of a greater degree of openness. Within the government regarding the timeframe for reducing emissions. Some within the industry have expressed worries regarding this year.
Sunak will assert that a strong economy is essential for the UK will be able to counter. The threat from Vladimir Putin and the Russian invasion of Ukraine. “We are going to face this threat to our values. Not only through the weapons and resources we offer to Ukraine but also by bolstering our economy at home,” he is expected to state.
“So, when I speak of security, I’m talking about responding to the conflict in Ukraine. However, I also refer to economic security that is based on an expanding economy.
“The safety of stronger public finances. As well as security for families with children by helping them with the costs to live.”
Sunak confirms fuel duty cut to aid firms and householders
Treasury says the move will save haulers £1,500 a year and van drivers £200
Chancellor Rishi Sunak has used his Spring Statement to implement a fuel-duty cut as part of his efforts. To help firms and households deal with a spike in inflation.
Chancellor brings forward green-energy rates relief
Sunak also removes VAT from the installation of domestic solar panels and wind turbines
Chancellor Rishi Sunak has set out plans to bring forward a business rates exemption for companies investing in green technology. Such as solar panels and battery storage, and removing VAT from a range of energy-saving measures for domestic properties.
Delivering his Spring Statement 2022 today. He told the House of Commons that the business rates exemption would come into effect on 1 April this year rather than the same date next year. As he announced in 2021’s autumn budget.