The main headline for employers from the chancellor’s speech today was the increase in the national living wage and minimum wage rates from April 2023. But, there were several other measures contained in the full autumn statement for 2022 that the chancellor did not expand upon. Personnel Today picks out the things HR and payroll professionals may have missed.
1. No increase to the income tax personal allowance
The income tax personal allowance (the point up to which employees do not pay income tax on their earnings – up to £12,570 per year), higher rate threshold (£50,271-£125,140 per year) and the national insurance contributions upper earnings limit (above which all employees pay a lower rate of NI – £967 per week) were already fixed at until April 2026. However, they will now remain at their respective levels until April 2028.
2. Fixing the lower earnings limit until 2023-24
The lower earnings limit, the level up to which employees do not pay national insurance, will remain at its 2022-23 level for another financial year. It is currently £6,393 per annum, or £123 per week. The upper secondary threshold, apprentices upper secondary threshold, and veteran upper secondary threshold will all stay fixed at £50,270 per annum until April 2028.
3. NHS workforce plan
The government will publish a comprehensive NHS workforce plan, including independently verified workforce forecasts, next year. This will include measures to make the best use of training to get doctors, nurses and allied health professionals into the workforce, as well as increase workforce productivity and retention.
It will also work towards achieving the Ockenden Review recommendation for 2,000 more midwives.
4. New skills reform adviser
Education reform expert Sir Michael Barber has been appointed to advise the chancellor and education secretary on the implementation of adult skills reforms.
The Treasury’s autumn statement 2022 document says: “The government recognises that skills are crucial in driving long-term economic growth and is taking forward major reforms set out in the Skills for Jobs White Paper: delivering T Levels, approving Higher Technical Qualifications, rolling out skills bootcamps, and introducing the Lifelong Learning Entitlement from 2025.”
Commentators have bemoaned the lack of detail around skills reform in the statement.
Ben Willmott, head of public policy at the CIPD, said: “Ensuring young people leave the education system with the skills they need is of course vital, but at least 80% of the 2030 workforce are already in employment. There needs to be a stronger focus on addressing the long-standing obstacles that have held back vocational education and training across the workforce and contributed to rising technical skills shortages.
“Crucially, urgent action is required to reform the apprenticeship levy which has failed on every measure and will continue to undermine investment in skills and economic recovery without significant reform.
“There is also a need to work with the regions to radically improve local business support services to encourage and enable many more firms, particularly smaller businesses, to invest in the skills, management capability and technology needed to boost productivity.”
Aveek Bhattacharya, research director at the Social Market Foundation, said: “It is encouraging to see the government putting education at the heart of its economic strategy, with the chancellor claiming that ‘being pro-education is being pro-growth’. Yet the sector needs more than warm words to ensure that more people are able to learn, enhance their skills, and fulfil their potential.
“More money for schools is welcome, but the fear is that post-16 and adult education, so often overlooked, will not get the support needed to help people navigate an increasingly choppy labour market.”
Recruitment and Employment Confederation chief executive Neil Carberry said the government should be ready to accept tough feedback when certain strategies were not working, including the apprenticeship levy which was not mentioned in the statement.
“We’ll look forward to working with Sir Michael Barber on a skills system that meets the needs of workers and companies, not just the Treasury. We’ll also be looking for more acknowledgement than we saw today of the vital role of services beyond finance in driving the UK economy,” he said.