Budget 2023: the ‘difficult years are far from over’

Despite the government revealing plans to help relieve financial pressures on individuals, charities have claimed the hunt is not over to ensure the country will permanently climb out of it’s economic debt.

This afternoon, at approximately 12.30pm, Chancellor of the Exchequer, Jeremy Hunt, delivered his second fiscal statement that included a vast amount of economic pledges intended to boost the UK’s economic growth. 

There was plenty to be said on helping households with sky high energy bills, including Mr Hunt revealing that the energy price guarantee will no longer be increased to £3,000 next month, and will instead remain at its current level of £2,500 until July 2023.

Following this pocket of good news, the Chancellor claims it will save the average family £160 on their energy bills and cost the treasury around £3bn. Mr Hunt also confirmed that the so-called ‘pre-payment premium’ – where customers who use energy prepayment metres pay more than those on direct debit – would be scrapped from July.

As well as focusing on reducing the cost of bills, the government have also outlined plans to provide struggling parents with childcare to ensure they can go back to working full-time. Currently the government provides 30 hours a week of funded childcare to parents with three and four-year-olds, but this is due to be extended to children who are just nine months old from September 2025.  

However, after being left to choose between feeding their families or heating their homes, families across England have lost faith in the government and are struggling to believe they will provide solid foundations to help them out of this economic crisis.

Rachelle Earwaker, Senior Economist at the Joseph Rowntree Foundation, (JRF) said: ‘The Chancellor has made some steps towards tackling some of the issues which have affected families on low incomes over recent years, but we have to be clear – the difficult years are far from over.

‘More fundamental reform may be needed to make childcare affordable and available where it is needed, and many of those who have spent this winter making impossible choices between eating hot meals and heating their homes will be wondering if he has really done enough to give them a secure foundation.’

Although Mr Hunt has outlined measures to help people with childcare and energy costs, Ms Earwaker notes that the government failed to comment on how they plan on tackling the housing crisis in which individuals cannot afford to keep up with their increased rent bills or pay for their mortgage after the Bank of England raised interest rates.

The JRF Economist added: ‘The glaring omission form the speech of any action to tackle the housing crisis, despite the Office for Budget Responsibility forecasting a drop in housebuilding in the coming years and higher mortgage rates and soaring rents putting pressure on households, is short-sighted and means the Chancellor is ignoring a growing and serious economic challenge.’

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