Autumn Statement: Osborne accused of resorting to stealth taxes on big businesses, wealthy property owners and council taxpayers
The decision to raise £11.6bn from an apprenticeship levy on businesses came under immediate fire from some tax professionals, who suggested it was at odds with the government’s “triple lock” ban on increasing any of the three main taxes. The levy requires employers to pay an additional 0.5 per cent on their employment costs to fund apprenticeships, which makes it very similar to a rise in employers’ national insurance contributions. Other big increases related to council tax, fuel duty, stamp duty, capital gains tax, corporation tax and pensions tax relief. Council taxpayers will pay an extra £6.2bn by 2021 after the chancellor announced that some local authorities would be allowed to raise council tax faster than previously assumed to meet some of the costs of social care and policing. One of the biggest increases was £3.8bn of higher stamp duty on buy-to-let property and second homes. Another £1.2bn will be raised from property owners by bringing forward payments of capital gains tax on residential property to within 30 days of completion. FINANCIAL TIMES
Autumn Statement: Grants for student nurses scrapped, replaced with loans
The change has been announced as part of the government's Spending Review as it wants to "modernise" the way healthcare students are funded. The cap on the number of student nurses is being abolished too, so more people will be able to train each year. The Royal College of Nursing (RCN) is concerned, saying "student nurses shouldn't have to pay for it". The government argues that by abolishing the existing cap it will mean that far more people will be able to start training. At the moment universities only have a certain number of places to offer. The government says that over half of all applicants are turned away. It says the removal of the cap means up to 10,000 new training places will be created over the course of the parliament. But the Royal College of Nursing says the ring-fence to nursing student funding has now been removed, adding: "a precious link between the NHS and its nurses is potentially at risk, making it harder to plan for the future workforce." BBC NEWS
Young 'to be poorer than parents at every stage of life'
The study, by the Institute for Fiscal Studies (IFS), said that households actually grew richer during the financial crisis. But the reason for that growth between 2006-12 was the increase in pension values over the period. And the slow rate of growth in overall wealth suggested that young people would lag behind earlier generations. Households aged between 45-54 saw the biggest increases in their pension wealth which rose on average by £38,000 over the period. The IFS said: "Even with these increases in average wealth, working-age households are at risk of being less wealthy at each age than those born a decade earlier." Among households aged 25-34, one third expected the state pension to be their largest source of income after retirement. Despite new legislation that automatically enrols workers into workplace pension schemes, nearly half (44%) did not expect to receive any income from a private pension. Rowena Crawford, a Senior Research Economist at the IFS, said: "It is striking how many individuals do not expect private pensions to have a role in financing their retirement, let alone be their main source of income... It will be interesting to see how these attitudes change as auto enrolment into workplace pensions is rolled out." BBC NEWS
RBS scraps bonuses for retail staff in bid to stem mis-selling
Royal Bank of Scotland is scrapping bonuses for 20,000 staff in an attempt to avoid future mis-selling scandals. Instead, those who work in NatWest and RBS branches as well as those who work in customer service in call centres are being given pay rises intended to compensate them for the loss of bonus potential. Union officials urged other financial institutions to follow the move by the 74% taxpayer-owned bank, which like rivals has been embroiled in the payment protection insurance mis-selling scandal. Rob MacGregor, Unite’s national officer for finance, said: “Unite has long campaigned to end the hard sell in retail banking and here we see RBS moving away from sales target-based bonuses, resulting in a pay rise for the majority of retail staff. It is time for other banks to follow suit and end the hard sell.” The sales and bonus culture in banks was highlighted by a £28m fine on Lloyds Banking Group in 2013, after one employee was found to have been so desperate to ensure he did not get demoted or miss out on his bonus that he sold himself one of the financial services products. GUARDIAN