Autumn statement: top four things to know

So the autumn statement and the spring budget are henceforth abolished, to be replaced by a spring statement and an autumn budget. Once you’ve got that straight, we’ve summarised the remaining key news points you need to know about below.

You can read the full statement on the government’s website.

1. The economy – investment in productivity

The big new spending initiative is a ‘National Productivity Investment Fund’. The government reckons increasing the UK’s productivity is the best way to see its economy through Brexit and the overarching theme is infrastructure.

Housing is to be supported by an injection of investment to high priority regions, where a lack of infrastructure is preventing new housing development. Transport is also in focus, with more money flagged for roads and railways. Meanwhile, ‘digital infrastructure’—meaning better and faster internet and mobile connectivity—will support innovation in technology. Finally, extra research funding for science aims to make sure the industry not only continues to invent and innovate, but keeps its development and production onshore.

 

 

2. Your pension – more of the same

Nothing particularly exciting in pensions news this time round (thankfully, as we’ve had more than enough to keep us on our toes in this world over the past few years). There will be a crackdown on pension scams, which is always welcome.

The ‘triple lock’ on state pension increases will remain in place. (If you’re not sure what that is, you can read about it on the website of our sister company, Chelsea Financial Services.) And while the majority of salary sacrifice tax benefits will be removed, pension contributions will continue to be eligible.

If you’re at the higher net worth end of the scale, you may be affected by a reduced limit on the amount you can contribute to your pension while also drawing money out of your pension (known as the MPAA, or money purchase annual allowance, limit). However, given most people are unable to keep contributing to their pension while also using its income, we expect the impact on most of our clients to be minimal.

3. Your other investments – a new savings bond won’t get you far

With a nod to continued low interest rates and the uphill battle for savers, the Chancellor announced a new savings bond, with a planned gross rate of 2.2%. It will be a three-year bond, open to those aged 16 years and over, but with a maximum limit of £3,000 and a starting sum of £100. It will be available for purchase for 12 months only.

So while we welcome any encouragement to start saving—and this could be a particular incentive for young people to put aside that extra cash—we think a key take-out from today’s autumn statement is that investing must continue to be a vital part of securing your financial future.

Browse our Elite Funds for investment ideas and find out more about how to choose a fund.

4. Your household spending – petrol, power, agent fees & insurance

The oil price has risen a lot since January and the pound has fallen. This would inevitably cause petrol prices to rise, so the fuel duty tax rate will remain frozen. (It’s been frozen for the past six years, so this isn’t necessarily ‘news’, but it’s good to know there are no changes.)

More broadly on the energy front, the Chancellor said the government would be keeping an eye on retail energy prices (i.e. your home electricity and gas bills), as it worked to simultaneously address carbon emissions and clean energy supply.

Any renters who’ve ever dealt with a letting agent will be pleased to hear the government intends to ban letting agent fees to tenants (although on the flipside it may be landlords who must now pick up the tab).

And there will be new rules on your various insurance policies automatically renewing, which could be good news if it encourages more competition among insurers looking to keep customers.

This article is provided for information only. The views of the author and any people quoted are their own and do not constitute financial advice. The content is not intended to be a personal recommendation to buy or sell any fund or trust, or to adopt a particular investment strategy. However, the knowledge that professional analysts have analysed a fund or trust in depth before assigning them a rating can be a valuable additional filter for anyone looking to make their own decisions. Past performance is not a reliable guide to future returns. Market and exchange-rate movements may cause the value of investments to go down as well as up. Yields will fluctuate and so income from investments is variable and not guaranteed. You may not get back the amount originally invested. Tax treatment depends of your individual circumstances and may be subject to change in the future. If you are unsure about the suitability of any investment you should seek professional advice. Whilst FundCalibre provides product information, guidance and fund research we cannot know which of these products or funds, if any, are suitable for your particular circumstances and must leave that judgement to you. Before you make any investment decision, make sure you’re comfortable and fully understand the risks. Further information can be found on Elite Rated funds by simply clicking on the name highlighted in the article.