Julie Marson on Rishi Sunak's Spring Statement: 'Impressive work and brilliant move on equalising tax and National Insurance thresholds'
Bishop's Stortford's Conservative MP has welcomed the Chancellor of the Exchequer's Spring Statement as "impressive work".
On her website, Julie Marson, the member for Hertford and Stortford, said she knew many families in her constituency would be pleased with the measures taken by Rishi Sunak on March 23.
The announcements include:
- A temporary 12-month reduction of 5p per litre on fuel duty
- Abolishing the 5% VAT on energy-saving materials (such as solar panels) for five years; wind turbines and water turbines will be added to the list of such materials.
- £500m for the Household Support Fund in 2022-23 which is distributed by councils in England; this allocation extends the fund, which received an initial allocation of £500m.
- A decrease, in April 2024, in the basic rate of income tax from 20% to 19%
- An increase in the level of earnings at which people start paying National Insurance contributions (NICs) from £9,880 to £12,570 in July 2022. The rise aligns the NICs thresholds (the primary threshold and lower profits limit) with the point at which people begin paying income tax on their income (the income tax personal allowance). The NICs thresholds and personal allowance will both then be unchanged until April 2026. They would normally be increased by inflation each year.
Mrs Marson was particularly impressed by this last measure: “The cost-of-living crisis is affecting us all and I know many families across Hertford and Stortford will be pleased with the measures taken by the Chancellor to address it and help those who are most vulnerable.
“No one can stop the global inflationary pressures all countries now face due to Covid, supply-side costs and the war in Ukraine.
“But I think Rishi Sunak has done a great deal to help mitigate it. The equalising of the National Insurance and income tax thresholds was a brilliant move that will save millions and millions of working people £330 a year [90p a day].”
The Office for Budget Responsibility, a non-departmental public body established to provide independent analysis of the public finances, said: “The OBR expects rising inflation to be above earnings growth over the next year or so. In addition, despite the policy measures announced in the Spring Statement, there will be a net increase in taxes across the economy starting in April.
"As a result, the OBR forecasts household post-tax incomes adjusted for inflation to fall in the financial year 2022-23 by the largest amount (-2.2%) since records began in the mid-1950s.
“On this same measure, the OBR now expects household post-tax incomes adjusted for inflation to start falling in Q2 2022. The OBR does not forecast them to recover to the same level as early 2022 until Q3 2024.”
Mrs Marson wrote on her website: “Motorists and the transport industry have been left reeling from fuel costs but, again, help was at hand in the form of the Chancellor’s announcement of a 5p cut in fuel duty for 12 months.
“I am also impressed with the targeted support through the doubling of the Household Support Fund to £1 billion that will allow councils to help those most in need.
“And we should not forget the £9 billion of support to help households with gas and electricity rises that has already been announced.”
The OBR said: “The policy measures announced by the Chancellor since October, including the £9 billion package of support to help with energy bills and the Spring Statement, are expected by the OBR to ‘offset a third of the overall fall in living standards’ that would have occurred in the coming 12 months.”
From April, average household energy bills will rise from £1,277 a year to £1,971 – a 54% increase with a further hike predicted.
Mrs Marson concluded: “This was a responsible Spring Statement, too, keeping to the fiscal rules, and it did not gloss over the fact we need to get borrowing down. Next year we will spend £83 billion alone on servicing our debt interest. This is too much. Doing so will allow us to cut income tax to 19p in the years to come. It is a fully costed pledge that will put more money in pockets. The statement was impressive work by the Chancellor and I welcome it.”
The cost of living has been increasing across the UK since early 2021. In January 2022, inflation reached its highest recorded level in 30 years.
As the Chancellor prepared to deliver his Spring Statement, the Indie asked Mrs Marson – who, like other MPs, has been awarded an annual pay rise of £2,212, up 2.7% from £81,932 to £84,144 – to comment on the cost of living crisis for her constituents but she did not respond.