Budget 2021 LIVE – Rishi Sunak speech at 12.30pm today – all you need to know about furlough and self employment grants

BORROWING IS ON AN ‘EXTRAORDINARY SCALE’ SAYS SUNAK

Rishi Sunak has told the Cabinet that borrowing is on an “extraordinary scale” but that the Government will “rise to that challenge and we can be optimistic about the recovery”, Downing Street said.

The Prime Minister’s official spokesman said: “The Chancellor set out to Cabinet details of the Budget he will deliver later today.

“He said that the coronavirus pandemic has hit our economy hard.

“We’ve stepped in to provide support and protect jobs and today we will outline more support to get people through to the other side of the crisis.

“The Chancellor said we must be honest with ourselves and the country about what that has meant. We are borrowing on an extraordinary scale – equivalent only to wartime levels.”

RISHI’S RESCUE

Rishi Sunak posed with his red box and team ahead of the Budget today – as he vowed to do “whatever it takes” to support people through the crisis.

The Chancellor posed with his top team and held Cabinet with the PM this morning as he prepares to speak to MPs in the House of Commons at 12.30pm.

He will also address the nation with a press conference at 5pm after taking hours of questions in Parliament.

Mr Sunak, delivering only his second Budget since becoming Chancellor last year, will extend a range of support measures to get the nation through the worst of the pandemic.

CONTACTLESS PAYMENT TO DOUBLE

The contactless payment limit will more than double to £100, Chancellor Rishi Sunak will say in the Budget.

The changes will see the legal single contactless payment limit raised from £45 to £100.

The Government said the change has been made possible by the UK’s exit from the European Union, which means we are no longer bound by EU rules on the maximum limit for contactless payment, which is currently set at £45.

Mr Sunak said: “As we begin to open the UK economy and people return to the high street, the contactless limit increase will make it easier than ever before for people to pay for their shopping, providing a welcome boost to retail that will protect jobs and drive growth.”

PICTURED

Prime Minister Boris Johnson attends a Cabinet meeting with Chancellor of the Exchequer Rishi Sunak and Chief Whip Mark Spencer in 10 Downing Street.

PICTURED

Chancellor of the Exchequer Rishi Sunak holds the budget box at 11 Downing Street ahead of today’s announcement.

WHAT TIME IS THE BUDGET TODAY?

The Budget will be held TODAY on Wednesday afternoon, March 3, 2021.

It is scheduled on the parliament website to take place after the Prime Minister’s Questions.

PMQs usually lasts around half an hour so the Budget is expected to start just after 12.30pm.

But, it may be later if PMQs overruns and time is often given to allow MPs to enter the House of Commons chambers.

Mr Sunak tweeted: “This Wednesday, in a Budget first, I will be taking questions from the public and the press straight after my statement. Live from 5pm.”

NUMBER OF BRITS FURLOUGHED SINCE PANDEMIC BEGAN

CONTINUED

Mr Sunak is gambling on buying some time to allow the economic recovery to strengthen in order to weather the unemployment hit.

The Coronavirus Job Retention Scheme has protected more than 11million jobs since its creation last March, with Mr Sunak promising further help in the “challenging months ahead — and beyond”.

Employees taking part will continue to receive 80% of their salary — up to a maximum £2,500 a month — for hours not worked until the scheme ends.

In July, business bosses will be expected to contribute 10% of the cost, increasing to 20% in August and September, as the economy reopens.

FURLOUGH FOR LONGER

The furlough scheme will today be extended until the end of September.

Rishi Sunak’s Budget vow means millions will have been paid to stay at home for a gruelling 17 months.

Employers will be asked to start chipping in from July in the hope of avoiding mass lay-offs.

The Chancellor’s vow “to do whatever it takes” to protect jobs will add £5billion a month to the pandemic’s £280billion support bill.

But he will also warn today that the time to get the nation’s books in order is rapidly approaching.

EXPLAINER – WHAT IS GOVERNMENT DEBT?

When the Government spends more than it receives in taxes and other revenues, it has to borrow.

This is sometimes referred to as the Government’s budget deficit.

The Government will need to borrow more during the coronavirus pandemic, says the Commons Library.

Over 85% of the Government’s total debt has been raised by selling gilts and bills, mainly to financial institutions.

Gilts and bills are ways of loaning money to the Government.

FORMER IMF CHIEF TELLS SUNAK THAT FISCAL SUPPORT SHOULD CONTINUE

Ken Rogoff, a former International Monetary Fund (IMF) chief economist, said he told Chancellor Rishi Sunak the pandemic is a war-like situation where fiscal support should continue.

Speaking to BBC Radio 4’s Today programme, Mr Rogoff said: “We’ve spoken once and, certainly at the time, and I’d say it now, we are in the middle of a war and you should not be worrying excessively about the budget deficit and about debt.

“You can worry about that at the other side.

“We are looking at catastrophe relief and we really need to be cautious about scaling back – the Government is very much needed now.”

EXPLAINER – WHERE DOES THE GOVERNMENT BORROW MONEY FROM?

The government borrows money by selling bonds, explains the BBC.

Public finances have been battered by the coronavirus pandemic since it gripped the UK from early 2020.

The Government has been handing out huge sums of money to businesses and employees to prevent millions of people winding up unemployed.

The cost of the Chancellor’s furlough scheme – which pays furloughed staff 80 per cent of their wages up to £2,500 a month – is £14billion a month, according to the Office for Budget Responsibility.

Raising taxes are one way to boost coffers. But to do so during a brutal pandemic, when many people are struggling financially, or are at risk of losing jobs, would be unpopular.

PREDICTIONS FOR BUDGET 2021

Chancellor Rishi Sunak will deliver his Budget today, announcing a raft of measures to get the economy back on track after coronavirus

For a list of our predictions click here.

TAX HIKE PLEA

Ex-Chancellor Ken Clarke urged Rishi Sunak to consider an income tax rise even though it would break a Tory manifesto vow.

He told the BBC: “Sensible people know in their bones all this emergency government spending is going to have to be paid for and is going to be a burden on them.

“Authors of the manifesto had no idea this massive economic blow was about to hit.”

BEER BILL CHEER

Beer duty is expected to be frozen to give pubs a flying start when lockdown is lifted.

Tory colleagues have urged the Chancellor to slash 2p off the price of a pint.

But sources say he will resist that but consider higher rates on supermarket booze.

Conservative MP Jane Stevenson said: “Landlords have gone above and beyond. A cut in beer duty would be warmly welcomed.”

EXPLAINER – WHEN IS THE BUDGET?

The Budget will be held today.

It is scheduled on the parliament website to take place after the Prime Minister’s Questions.

PMQs usually lasts around half an hour so the Budget will start just after 12.30pm.

It may be later if PMQs overruns and time is often given to allow MPs to enter the House of Commons chambers.

FURLOUGH EXTENDED

We know for certain the Chancellor will extend furlough until September.

It means 80 per cent of people’s wages will continue to be paid for months to come, to help firms get back on their feet again.

From July, though, they will be asked to chip in, as the Chancellor weans them off the cash help they will have been getting for 17 months.

In July, employers will be expected to contribute 10 per cent of the cost, increasing to 20p per cent in August and September, as the economy reopens.

The Coronavirus Job Retention Scheme has protected more than 11 million jobs since its creation last March, with Mr Sunak promising further help in the “challenging months ahead – and beyond”.

TAX RISES & FREEZES

At every Budget the public get an update of the public spending on the cards.

The Chancellor’s vow “to do whatever it takes” to protect jobs will add £5 billion a month to the pandemic’s £280 billion support bill.

But with the nation’s coffers reeling from the Covid crisis, Mr Sunak is staring at £400 billion blackhole.

The chief bean counter will set out “a three-point plan to protect jobs” – but also give the nation a reality check over the dire economic situation left in the wake of the pandemic.

But he will also warn today that the time to get the nation’s books in order is rapidly approaching.

WHAT TO EXPECT IN TODAY’S BUDGET?

BUILDING UP CONFIDENCE IN ECONOMY SHOULD BE PRIORITY OVER TAXES SAYS SHADOW CHIEF SECRETARY

The shadow chief secretary to the Treasury has said “building up confidence” in the economy should be prioritised over tax rises.

Labour’s Bridget Phillipson told Sky News: “We don’t think that now is the right time for tax rises, the economy is in such a fragile position that hitting people in their pockets when we need to be building up confidence in our economy is absolutely essential.

“The Chancellor is out on a limb on this, mainstream opinion is very clear that securing the recovery must be an absolute priority of the Government.

“That should mean we don’t see tax rises immediately but action to protect family finance.”

NICE MOVE

The stamp duty holiday is set to be extended for months by Chancellor Rishi Sunak in today’s Budget.

The holiday was due to expire on March 31, but it’s set to be extended by at least three months until June, The Times reports.

The Treasury first announced last year that it would temporarily raise the stamp duty threshold from £125,000 to £500,000 for property sales.

The rates apply to home buyers in England and Northern Ireland only, as they differ for those buying homes in Scotland and Wales. Read more here.

EXTRA CREDIT

A £20 a week Universal Credit uplift in payments has been extended for another six months.

The Government’s temporary coronavirus support for families on benefits is worth £1,040 a year and was supposed to only last a year.

Instead, claimants will continue to get the extra cash until the autumn, when the support is then expected to be phased out.

From then, only the poorest of families will get the increased payments.

CONTINUED…

Mr Sunak will also announce…

– Nearly £410 million to support the badly-hit culture sector.

– £300 million to help cricket, tennis and horse racing in a summer sports recovery package.

– £150 million to help local communities save struggling pubs, sports clubs, theatres and Post Offices.

– £2.8 million to help fund a joint UK and Ireland bid to host the 2030 football World Cup.

– Extend the furlough scheme until the end of September

BUDGET DAY

Rishi Sunak will unveil his Budget in the House of Commons today and pledge to do “whatever it takes” to help people and businesses through the coronavirus crisis.

The Chancellor is set to outline a three-point plan to support people through the coming months, rebuild the economy and fix the ravaged public finances in the wake of the pandemic.

Mr Sunak is also expected to outline plans to allocate:

– £5 billion for a new grant scheme to help businesses.

– £1.65 billion to boost the UK’s vaccine roll-out.

– £520 million to support small UK businesses with training and software.

3MILLION WORKERS NOT ELIGIBLE FOR FIRST THREE GRANTS

Up to three million self-employed workers were not eligible for the first three grants.

Self-employed workers who are company directors or run their businesses as limited companies were also unable to apply.

Rishi Sunak, The Chancellor of the Exchequer, said: “Our Covid support schemes have been a lifeline to millions, protecting jobs and incomes across the UK.

“There’s now light at the end of the tunnel with a roadmap for reopening, so it’s only right that we continue to help business and individuals through the challenging months ahead – and beyond.”