Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Latest NewsEconomics, government & businessHR practicePay & benefitsPay settlements

Emergency Budget: the measures affecting HR

by Kat Baker 22 Jun 2010
by Kat Baker 22 Jun 2010

The public sector pay freeze will be extended for an extra year and employers’ National Insurance contribution threshold has been raised, the chancellor has revealed.


Unveiling the emergency Budget in the House of Commons earlier today, George Osborne announced the one-year public sector pay freeze, due to start in April 2011, will now be extended to 2012.


This freeze will affect all staff earning more than £21,000, but the 1.7 million public servants earning less than this will get an extra £250 a year during the freeze.


From April 2011, the threshold at which employers start to pay National Insurance will also rise by £21 per week above indexation, while companies set up outside the South East will not have to pay National Insurance for the first 10 employees hired for the next three years.


The chancellor pledged this policy would benefit 400,000 businesses.


Osborne also announce the government would launch a new consultation on the phasing out of the Default Retirement Age, and would accelerate the increase in the State Pension Age to 66.


But welfare provisions came under attack, with lone parents faced with returning to work once their youngest child goes to school, or losing their income support benefits.


Currently, lone parents do not have to start looking for work until their youngest child reaches 10 years of age.


Those on Disability Living Allowances will also have to undergo medical assessments from 2013 to prove they are entitled to the benefit.


The government’s cuts to the welfare bill will lead to a saving of £11bn by 2014-15, Osborne insisted.


The banks were not exempt, either. The chancellor announced that from January 2011 there will be a bank levy, which will raise £2bn a year.


Other taxes to rise include VAT, which will rise from 17.5% to 20% from 4 January, raising £13bn a year.


From April 2011, basic state pensions will also be re-linked with earnings.


Meanwhile, Osborne also announced that he expected the UK economy to grow by 1.2% this year and 2.3% next year, and rise further to 2.9% in 2013. But he warned by 2014 and 2015 growth would dip again to 2.7%.


HR professionals and experts contributing to Personnel Today’s live Budget blog said many of the announcements were “as expected”, but warned more cuts would come in the Comprehensive Spending Review in the autumn.


Roger Seifert, professor of industrial relations and HR management, said: “Generally it was much weaker on growth and business recovery than expected, but the attacks on welfare and jobs were expected.


Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

“The real impact will be clear later when the government announces the detail of its plans for the public sector. It will be harder to manage public service workforces, it will be harder to deliver the current quality and quantity of public services, and it will lead to real unrest among public sector staff.”


Mervyn Dinnen of Courtenay HR consultancy, added the Budget was “very much as expected with a lot of benefits cut”, but he warned: “I still don’t see where the job creation will come from”.

Kat Baker

previous post
Work can help people recover from depression
next post
Emergency Budget: feedback from employment experts

You may also like

Fire and rehire: the relocation question

22 May 2025

Public sector workers gain pay rises of up...

22 May 2025

UK net migration slashed by half in one...

22 May 2025

How neuroscience can unlock employee recognition

22 May 2025

UK universities fret over fall in international students

22 May 2025

HSBC employees warned of office attendance link to...

22 May 2025

The Law Society: Navigating the new world of...

22 May 2025

Workplace stress: Why it’s time to rebrand resilience

22 May 2025

Restaurant tips should be included in holiday pay

21 May 2025

Fewer workers would comply with a return-to-office mandate

21 May 2025

  • 2025 Employee Communications Report PROMOTED | HR and leadership...Read more
  • The Majority of Employees Have Their Eyes on Their Next Move PROMOTED | A staggering 65%...Read more
  • Prioritising performance management: Strategies for success (webinar) WEBINAR | In today’s fast-paced...Read more
  • Self-Leadership: The Key to Successful Organisations PROMOTED | Eletive is helping businesses...Read more
  • Retaining Female Talent: Four Ways to Reduce Workplace Drop Out PROMOTED | International Women’s Day...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+