Spring Statement a 'missed opportunity and many will still feel worse off', says South Tyneside Council chief
People in South Tyneside will continue to feel worse off after the Spring Statement, a borough leader has said.
Chancellor Rishi Sunak unveiled cuts to fuel duty and a rise in the threshold before National Insurance and income tax must be paid in the ‘mini budget’, part of a package to ease the cost of living crisis.
Cllr Tracey Dixon, leader of South Tyneside Council, however gave a mixed reaction to the announcements – and said it had been a ‘missed opportunity’ to help people struggling amid a hike in the cost of necessities.
“The Chancellor’s spring statement provides a bleak outlook,” she said. “The facts remain that people will feel worse off with a real terms pay cut for many from next month. The Office of Budget Responsibility themselves have referred to it as the biggest fall in living standards since records began.
“Whilst I welcome the measures to help those on lower incomes like the equalisation of National Insurance and Income Tax thresholds, the statement, for me, was a missed opportunity to really address the cost of living crisis for all.”
Cllr Dixon said South Tyneside Council would continue to help residents and businesses through tough times.
She said the announced extension of the ‘Household Support Fund’ – set up during the pandemic to help households most in need – will be of some help to the council in supporting those in crisis, ‘but for many there was an opportunity to have avoided that crisis point being reached’.
"We are committed to supporting households in financial difficulty or crisis. Unlike many other councils South Tyneside retains a local welfare scheme supporting those most in need at times of crisis. The Welfare Support Team has supported customers to access over £3.5million in owed benefits and income in the last year and we will continue that work in earnest.
She also welcomed the fuel duty cut, which will see 5p per litre shaved off the rate for 12 months – but added it will ‘have limited impact as prices soar’.
"Similarly the reduction of VAT on energy saving materials such as solar panels, heating pumps and roof insulation from 5% to zero for five years is great news and supports our own climate objectives,” she said.
"However, I fear that few will be able to make significant investments as they continue to feel the pinch.”
She added: “I do however welcome the Government’s willingness to engage with businesses and other stakeholders to consider cuts and reforms to best support future investment. Our recent business survey highlighted obstacles to growth including finance, staff recruitment and skills shortages – predominantly technical skills – with over half expressing the need for support in training and skills. With no mention of the UK Shared Prosperity Funds which replaced EU Funds and was expected to be a vital source of funding to support local businesses, place and skills we will continue to lobby government on behalf of South Tyneside business.
“Whilst the Chancellor has promised a 1p cut in basic income tax in 2024, there was little in his statement about the here and now to support our residents and businesses. We needed action now, not promises for later.”