Rishi Sunak presented his budget to parliament yesterday, though many of the details were leaked in the run-up to it.
Here, some of our lawyers give their reaction to the announcements, and touch on what they mean for Dorset’s businesses and wider economy.
Affordable homes
The Chancellor announced that £24bn budget will be used for a ‘multi-year housing settlement’.
£11.5bn of this will be used to build up to 180,000 ‘affordable homes’ and £1.8bn of this was pledged to bring brownfield into use.
Property Partner Oonagh McKinney says: “We have seen, and indeed continue to see, unprecedented demand in the local housing market over the past 18 months, in particular from first time buyers.
The Stamp Duty holiday has caused a boom in the residential property market, but lack of stock has pushed prices beyond the reach of many in Dorset.
Contribution towards affordable housing development is much needed.”
Unsafe Cladding
The news that £5 billion will be pledged to help remove unsafe cladding will come as welcome news to residents of affected blocks, in particular those left in limbo unable to sell.
Leaseholders will be crossing their fingers that they will be able to get quick access to these funds.
The works will be partially funded by a residential developer property tax of 4% for qualifying businesses with profits of over £25 million.
“Whilst this is a step in the right direction, it is still apparent that individual leasehold owners will still be footing substantial bills for cladding that was not of their doing.
Explains Property Litigation specialist Will Bartley.
“It is also still unclear as to when this will be implemented and how quickly the funds will be distributed to assist those in need.”
National Living Wage
The National Living Wage is set to rise from April next year. Over-23s will see their hourly rate increase from £8.91 to £9.50.
Employment Partner Paul Burton says: “Employers with staff under the age of 23 should be mindful of regularly checking that staff are in the correct pay bracket and when a change is announced anyone paying staff at or around minimum wage want to review to ensure that the correct rate is being paid.
The cost of failing to do so can be significant. Even a relatively small number of staff underpaid for just a few weeks can result in a costly collective sum.”
Paul outlines the new rates here.
Business Rates
A range of measures were announced with the aim of supporting these hard-hit businesses, including a business rates improvement relief and the freezing of the business rates multiplier.
The new 1 year 50% business rates discount will be introduced for companies in the retail, hospitality and leisure sectors.
Corporate & Commercial Lawyer Karen Edwards says:
“Dorset’s economy features a huge number of leisure and hospitality businesses who have been hit extremely hard by the pandemic.
Many of these businesses were hoping for drastic reform, and the opposition is in favour of scrapping business rates.
These announcements will hopefully help some of these businesses that are a crucial part of the local economy.”
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