Autumn Statement 2023: How will it affect people in later life?

The Autumn Statement was made in the House of Commons by Jeremy Hunt today. One of the key financial events in the political calendar, the chancellor updates MPs on the country's finances and the government's tax and public spending plans based on the latest forecasts from the Office for Budget Responsibility (OBR).

A summary of the economic state of the country by Hunt indicated that the economy has grown... ‘But the work is not done.’ UK tax levels are at their highest level since records began 70 years ago, according to the Institute for Fiscal Studies and the OBR has also admitted that inflation falling to the 2% target will take longer (until 2025) than previously thought which is why the banks have been warning that interest rates won’t fall soon.

The Statement seemingly focused on putting more money in the public’s back pocket with announcements about abolishing ‘Class 2’ National Insurance, reducing the National Insurance rate, benefits increasing and a freeze on alcohol tax among the 110 measures. There was an immediate backlash from Labour saying Hunt had not done enough to offset earlier rises.

Whilst there had been rumours about changes to inheritance tax and ISAs in the lead up to the Statement, neither were mentioned in the initial Statement in the early afternoon but we will update as and when any details emerge.

However, there were cheers as Hunt announced he will honour the government's commitment to the pensions triple lock in full. From April 2024, the government will increase the full new state pension by 8.5% to £221.20 a week, worth up to £900 more per year. This is reportedly one of the most substantial cash increases to the state pension ever.

Pension reforms were also featured in the Statement, with Hunt announcing he will consult on giving people one pension pot for life. This would potentially give pension savers a ‘legal right to require a new employer to pay pension contributions into their existing pension.’ Hunt said these reforms could help unlock an "extra £1,000 a year in retirement for an average earner saving from 18."

All in all, no surprises from this Autumn Statement but positive measures for many.