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Monday, December 6, 2021

Budget 2021: Eight ways Rishi Sunak’s plans affect you


This is not the first, but the second, Budget delivered by Chancellor Rishi Sunak this year. It is certainly not the first time we have heard some of the content.

Despite a swathe of announcements having been released in advance, the measures as a whole will have a significant impact on your finances. This is how the money in your pocket will be affected.

1. Universal credit boost

If you work and receive universal credit, you are most likely affected by what is officially known as the taper rate. That is, as you earn more, your universal credit payment decreases.

Every pound earned (sometimes above a base level of earnings known as the work allowance), 63p is deducted from your benefit payment automatically.

By lowering it to 55p, the chancellor is allowing people to keep more of their earnings. The same is true when the work allowance is increased.

Around two million people would be better off depending on their circumstances, but another two million claimants will receive no benefits because they either do not work or do not earn enough.

It is a significant policy in addressing rising living costs, and it will be implemented “within weeks” and no later than December 1. It comes after the government was chastised for cancelling the £20-a-week universal credit boost given during the pandemic, which had benefited 5.5 million people.

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