- Rail fares rises will be capped at 1% plus inflation retail prices index (RPI), which currently stands at 5.2%. This is lower than the initial plans to cap fare rises at 3% plus RPI, which Chancellor George Osborne called “too much” in his Autumn Statement, at the end of last year. However, commuters are still likely to feel the effects.
- The 3p fuel duty increase, originally scheduled for January 2012, has been postponed until August.
- The state pension will increase by £5.30 to £107.45 a week from the new tax year, beginning on 6 April. The full couple’s allowance will also go up, increasing by £8.50 to £171.85. Pension credit will increase by £5.35 a week.
- In its draft Finance Bill, the government announced that savers over the age of 60 will be able to take any pension pots under £2,000 as a lump sum from the start of the new tax year too.
- The government’s auto-enrol pension programme, called National Employment Savings Trust (NEST), also comes into effect from October 2012. Initially, only large companies will use the opt-out pension scheme, with smaller companies and their employees not having to address NEST until 2014.
- Stamp-duty relief for first-time buyers ends on 24 March. Thereafter, new homeowners will have to pay stamp duty on properties above £125,000 instead of the current £250,000 threshold.
- A new mortgage indemnity scheme, running from spring this year, aims to help 100,000 homebuyers purchase homes with just 5% deposits. The scheme only applies to new builds. By underwriting part of the risk itself, the government hopes to encourage more house purchase activity in 2012. Although the scheme doesn’t specifi cally apply to first-time buyers, it’s likely to be most popular with this section of the market.
- The government has committed nearly £1 billion towards addressing the youth unemployment issue through work placements, financial subsidies for employers and apprenticeships.
- After a two-year pay freeze, public sector workers will see their pay increase by 1% – but for many this won’t kick in until 2013. This increase is capped and has been criticised for being so low compared with the current rate of inflation – as well as falling behind the national average salary increase of 1.7%.
- Most working-age and disability benefits will be uprated by 5.2% – in line with RPI in April. Despite this sounding generous, other less-broadcasted changes include the scrapping of the planned extra £110 on top of inflation increases to the child tax credit.
- The government has also pledged to double the number of childcare places for the most deprived two-year-olds to 260,000 by 2014/15.