On Wednesday, the Government announced its Spring Budget 2023. If you’d like to read the full Spring Budget, you can access it here, but to make things easier for you, we’ve highlighted some points that are most relevant for SMEs below.
1. Increased support for flexible working and worker protections
Our recent blog discussed the Government’s plans to make flexible working the default, and the Chancellor reiterated these plans to support flexible working. He also confirmed the Government’s backing of a number of private members’ bills relating to employment, including:
- the right for workers to request more predictable working patterns;
- greater protections for pregnant workers and those currently or recently on family leave from being made redundant;
- entitlements to unpaid carer’s leave of at least one week per year, for anyone looking after a dependent who needs care because of old age, disability or sickness; and
- the right for parents to take up to 12 weeks of paid neo-natal leave in addition to other leave entitlements, if their baby needs continuous hospital care.
These bills have not yet been passed into law; keep up with our blog to stay up-to-date with progress.
2. Encouraging over-50s to stay in (or return to) employment
During the COVID-19 pandemic, many workers over the age of 50 left the labour market. To incentivise this demographic to continue working (or return to work) the Government plans to increase tax relief on pensions. It will remove the Lifetime Allowance charge on tax-relieved pensions savings from April 2023 before abolishing the Lifetime Allowance completely from April 2024, and it will increase the annual allowance on tax-relieved pensions from £40,000 to £60,000.
The Government also plans to introduce a ‘Returnership’ apprenticeship scheme aimed at helping over-50s return to the workforce, as well as a ‘Lifelong Loan Entitlement’ in England which will assist those over 18 to study, train and upskill throughout their working lives.
3. Plans to remove barriers for disabled workers
The Government has announced its focus on alleviating some of the leading causes of long-term sickness – mental health and musculoskeletal conditions. It plans to make more digital resources available for those suffering, as well as to pilot a new programme called Workwell. This programme will aim to provide more employment and health support for disabled workers.
For more guidance on how to assist your disabled workers, see our Q&A.
4. Support with rising cost of living
The Government has announced £94bn of funding to assist households with higher bills during this financial year and the next. Some of this funding will go towards:
Childcare costs
The Chancellor plans to start providing 30 hours of free childcare a week to children aged between nine months and three years, for 38 weeks a year. This will be available to eligible working parents and the Government plans to roll it out in phases from April 2024. The Government also announced additional funding for childcare providers and childminders.
Energy costs
The Energy Price Guarantee (which caps the price households pay for gas and electricity) will be maintained at £2,500 per year until 1 July 2023 when it will increase to £3,000 per year from 1 July 2023.
The Government will remove the premium paid by customers using pre-payment meters (PPM) versus direct debit payments, call for evidence on how to better support domestic consumers of energy, and invest in the UK energy system to increase resilience to future energy price shocks.
Fuel and alcohol duties
Fuel duties will be maintained for the next 12 months, including keeping the 5p cut in place. Draught Relief will be increased, to give hospitality businesses selling alcohol relief on their costs.
5. Support for levelling up areas outside London and the South East
The Government reiterated the need for growth in the UK outside London and the South East. The Government has already identified 12 areas across the UK which have growth potential, and has begun working with those Investment Zones to establish how the Government’s investment can be best used.
6. Tax measures to assist loss-making SMEs and creative industries
The Government has announced an enhanced R&D tax relief for smaller businesses, taking effect from 1 April 2023. This means loss-making companies whose R&D expenditure totals at least 40% of their total expenditure will be able to claim higher tax relief. The Government will also provide increased audio-visual tax reliefs to support creative industries.
The content in this article is up to date at the date of publishing. The information provided is intended only for information purposes, and is not for the purpose of providing legal advice. Sparqa Legal’s Terms of Use apply.
Marion joined Sparqa Legal as a Senior Legal Editor in 2018. She previously worked as a corporate/commercial lawyer for five years at one of New Zealand’s leading law firms, Kensington Swan (now Dentons Kensington Swan), and as an in-house legal consultant for a UK tech company. Marion regularly writes for Sparqa’s blog, contributing across its commercial, IP and health and safety law content.