What was in the Spring Statement?
National Insurance
One of the key announcements was the planned rise to National Insurance by 1.25 percent - meaning people on higher salaries will pay more.
However the government also announced that the threshold for paying National Insurance and Income Tax will be lowered, meaning you won’t start paying National Insurance until you’re earning £9,600 a year and Income Tax until you’re earning around 12,600 a year.
The bottom line is that if you earn between £9,600 and £35,000, you can expect to either not pay any more National Insurance than you do currently, or if you’re at the lower end you’ll pay less. However, if you do earn over £35,000 a year you can expect to pay more.
Fuel duty
Another measure introduced by the government was a 5p cut to fuel duty. This essentially means you’ll pay less tax on every litre of fuel - the average family can expect to save just over £1 when filling up a typical tank of petrol.
VAT
It was also announced that VAT will be removed on home efficiency measures such as solar panels and heat pumps. While this will benefit those who can afford to insulate or get better energy efficiency measures, it’s unlikely to help low-income families facing rising energy costs.
There are several cost-effective energy efficiency measures you can take to save on your costs, such as using draught excluders, installing low-energy light bulbs and washing on lower temperatures. For more helpful tips visit the STEP energy youtube page.
Support
The government also promised a £500 million support fund to be given to household support for vulnerable people. This will be distributed by local councils.
Manchester City Council are offering between £39 and £49 to households struggling to pay their fuel costs or at risk of disconnection. To qualify, households must be in receipt of benefits and have someone who is under the age of five, elderly, disabled or vulnerable.
Vouchers can be applied for on the Manchester City Council website. Payments are made to pre-paid meter cards and can be received a maximum of once a year.
Council tax
An earlier measure not introduced in the spring statement was the £150 council tax rebate for households in bands A to D. If you pay your council tax by direct debit, you should receive this directly in April.
If you don’t pay by direct debit, you’ll either be contacted by the council to arrange a payment or receive this as a rebate. You can find out more on the Manchester Council website.
If you’re worried about energy costs
If you’re unable to pay your fuel bills or have fallen into debt as a result of the cost of living crisis, you should get in touch with us at Citizens Advice Manchester. We can offer free advice on how to maximise your income, reduce your fuel costs and access extra support.
Call us free on 0808 278 7800 or visit our website for more ways to access advice.