Money-saving expert Martin Lewis reacted to today’s budget – after receiving a check from the chancellor himself.
Mr Lewis tweeted during today’s announcement: “I think I just got a name briefing #budget2023 – this first.
In a series of posts, the presenter drew attention to the changes to pension caps and universal credit, as well as the expansion of childcare funding announced in today’s budget.
Mr Lewis raised questions about the budget announcement, including whether those paying for childcare through tax credits would be better off moving to Universal Credit and whether it would be “harder” for unemployed people after Jeremy Hunt’s budget today.
He said: “The Universal Credit childcare increase WILL NOT apply to people on older benefits (i.e. tax credits). So the question will be whether those who pay for childcare from tax credits will ask to be transferred to UC.
He also claimed that the two million jobseekers on Universal Credit will face “stricter sanctions if they don’t take ‘appropriate’ jobs. So it’s going to be harder for people who don’t work and who the government says they can. “
Lewis also drew attention to changes in pension caps. He said: “The maximum annual amount you can contribute to your pension is set to increase (from April I presume) from £40,000 to £60,000.”
The financial expert also pointed out changes to the maximum amount you can put aside into your pension over your lifetime, which has been lifted today. In a video posted on Twitter, he said the abolition of the annuity benefit “only applies to richer people”.
However, Mr Lewis clarified that “this will not apply to the 25% tax-free lump sum. The maximum you can take will still remain at its current level of c. £268,000.”
He continued: “PLUS didn’t say but the money purchase allowance has increased from £4,000 to £10,000. This is the amount you can put aside for your retirement once you’ve used it up a bit.”
The financial expert also thanked the government for postponing the 20% increase in the energy price guarantee, which, he says, means “in practice, canceling it.”
In a letter to the chancellor, Lewis previously claimed that an increase in the Energy Price Guarantee – the state-subsidized energy rate – “would again increase energy bills for almost every home across England, Scotland and Wales”.
Among the measures announced in today’s budget is a significant expansion of state-funded childcare to boost economic growth.
The Chancellor has also revealed that he will add £11bn to the UK’s defense budget over the next five years and extend support for energy bills for a further three months.
The chancellor said the Office for Budget Responsibility (OBR) now predicted the UK would not enter a technical recession this year and that the government would “deliver on the prime minister’s priorities to halve inflation, reduce debt and boost economic growth”.
Despite “persisting global instability,” Hunt said, the OBR expects UK inflation to fall from 10.7% in the final quarter of last year to 2.9% by the end of 2023.