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Autumn Statement 2023: key announcements for the employment sector

Our Employment team comments on Hunt’s ‘Autumn Statement for growth’.

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Published 22 November 2023

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Chancellor Jeremy Hunt today announced what he dubbed was his ‘Autumn Statement for growth’. Amongst the various new measures outlined by the Chancellor, several related to employment and the world of work. The main changes include:

  • The National Insurance rate for employees will be cut from 12% to 10% from 6 January 2024, which is reported would help some 27 million people.
  • The National Living Wage will increase to £11.04 per hour. The National Living Wage will also be extended to 21 and 22-year-olds, which currently are only guaranteed the lower National Minimum Wage for their age bracket.
  • Class 2 National Insurance charge will be abolished for the self-employed, and Class 4 charges will be cut by 1% from April 2024. Combined, these reforms will reportedly save an average £350 a year for the self-employed.
  • A new right for employees to request new employers pay into an existing pension pot, rather than having to sign up to a different pension scheme run by their new employer.

The Chancellor stated his reforms are aimed at, amongst other things, increasing the number of people in work. He stated the reforms to National Insurance alone will lead to a further 94,000 people in full time employment.

These measures also appear designed to put more money in people’s pockets. However these tax cuts follow several years of tax rises and freezes, meaning the cuts announced today may not offset earlier increases.

Employers will need to take note of the changes, especially concerning the new right around workplace pension schemes (for which we await further guidance) and changes to the National Living Wage, which from April 2024 will expand to include workers who are 21 and over.

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Shorter Reads

Autumn Statement 2023: key announcements for the employment sector

Our Employment team comments on Hunt’s ‘Autumn Statement for growth’.

Published 22 November 2023

Associated sectors / services

Authors

Chancellor Jeremy Hunt today announced what he dubbed was his ‘Autumn Statement for growth’. Amongst the various new measures outlined by the Chancellor, several related to employment and the world of work. The main changes include:

  • The National Insurance rate for employees will be cut from 12% to 10% from 6 January 2024, which is reported would help some 27 million people.
  • The National Living Wage will increase to £11.04 per hour. The National Living Wage will also be extended to 21 and 22-year-olds, which currently are only guaranteed the lower National Minimum Wage for their age bracket.
  • Class 2 National Insurance charge will be abolished for the self-employed, and Class 4 charges will be cut by 1% from April 2024. Combined, these reforms will reportedly save an average £350 a year for the self-employed.
  • A new right for employees to request new employers pay into an existing pension pot, rather than having to sign up to a different pension scheme run by their new employer.

The Chancellor stated his reforms are aimed at, amongst other things, increasing the number of people in work. He stated the reforms to National Insurance alone will lead to a further 94,000 people in full time employment.

These measures also appear designed to put more money in people’s pockets. However these tax cuts follow several years of tax rises and freezes, meaning the cuts announced today may not offset earlier increases.

Employers will need to take note of the changes, especially concerning the new right around workplace pension schemes (for which we await further guidance) and changes to the National Living Wage, which from April 2024 will expand to include workers who are 21 and over.

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