AUTUMN STATEMENT 2024

SUMMARY

In October 2024, the Chancellor of the Exchequer laid out the UK’s Autumn Budget 2024—a transformative plan that aims to secure fiscal stability, bolster public services, and stimulate long-term growth. At its core, the Budget is designed to protect working people, rejuvenate the NHS, and rebuild Britain’s infrastructure while establishing a more sustainable fiscal framework. This comprehensive summary delves into the major components of the Budget, making it an essential read for accountants, financial analysts, and anyone interested in the UK’s fiscal policy.

Strengthening the Fiscal Framework
One of the cornerstone initiatives of the Autumn Budget 2024 is the introduction of a robust fiscal framework that seeks to deliver transparency, accountability, and stability. The government has set out two new fiscal rules:
1. Stability Rule
The Stability Rule mandates that the current budget must be balanced—meaning that day-to-day spending is covered entirely by revenues. Borrowing, under this rule, is strictly limited to investments that are expected to yield future benefits. By aiming to bring the budget into surplus by 2027-28, the government ensures that future generations are not burdened by today’s public spending. This rule is crucial for establishing confidence among investors and rating agencies, as it underscores the government’s commitment to sustainable financial management.
2. Investment Rule
Complementing the Stability Rule is the Investment Rule, which focuses on reducing net financial debt as a percentage of GDP. Unlike traditional measures that only account for borrowing, this rule recognizes government financial assets such as loans and equity holdings. This broader perspective allows the government to increase public investment without significantly affecting its debt metrics. By ensuring that increased spending translates into tangible economic benefits, the Investment Rule aims to unlock a wave of productivity improvements and private sector growth.
Both these rules are embedded within a new Charter for Budget Responsibility, reinforcing the commitment to transparent and prudent fiscal management. For accountants and financial planners, understanding these rules is key to assessing the long-term fiscal outlook of the UK government.

Boosting Public Investment and Capital Spending
A defining feature of the Autumn Budget 2024 is its strong emphasis on capital investment—a move designed to stimulate long-term economic growth and crowd in private investment. The government has announced an additional capital investment package of over £100 billion spread over the next five years. This massive injection of funds is targeted at several critical areas:
Infrastructure and Transport
The Budget outlines significant investments in transport infrastructure, aiming to modernize the nation’s road and rail networks. These measures are expected to reduce congestion, improve connectivity, and support the overall efficiency of the economy. Enhanced transport links will also facilitate trade and mobility, which are essential for a competitive business environment.
Housing and Community Development
To address the chronic housing shortage and stimulate construction, the government has committed to building 1.5 million new homes. This initiative is not only expected to provide much-needed affordable housing but also to boost construction activity and generate employment opportunities. The housing investment is seen as a key driver of long-term economic growth, with positive spill-over effects on related sectors.
Research, Development, and Innovation
Recognizing the importance of innovation in driving future growth, the Budget increases funding for research and development (R&D). This commitment is designed to maintain the UK’s position as a global leader in science and technology, ensuring that the country remains competitive in emerging industries. The government’s strategy here is to foster a vibrant ecosystem of startups, research institutions, and established businesses that can work collaboratively to bring new products and technologies to market.
Public Services and the NHS
A major element of the Budget is the enhanced funding for public services, particularly the National Health Service (NHS). The government is set to provide an additional £22.6 billion in resource spending for the Department of Health and Social Care in 2025-26. This investment will help reduce waiting times for elective procedures, increase the capacity for diagnostic tests, and improve overall patient care. For financial professionals, this focus on the NHS underscores the government’s commitment to protecting and improving public welfare while supporting economic stability.

Comprehensive Tax Reforms
To finance the ambitious public spending and investment agenda, the Autumn Budget 2024 introduces a series of tax reforms that aim to raise revenue in a fair and efficient manner. The following are the key tax measures that have been announced:
National Insurance Contributions (NICs)
The government is raising the rate of employer NICs by 1.2 percentage points, with the per-employee threshold being reduced from £9,100 to £5,000. These changes are expected to generate significant additional revenue—approximately £6.5 billion per year by 2029-30. To mitigate the impact on small businesses, the Employment Allowance is being increased, and the threshold is being removed for eligible employers, ensuring that around 865,000 employers will benefit from reduced NIC liabilities.
Capital Gains Tax and Inheritance Tax
There are also changes to the taxation of capital gains and inheritances. The Budget increases the lower and higher rates of Capital Gains Tax from 10% to 18% and from 20% to 24%, respectively. These adjustments are intended to ensure that asset owners contribute their fair share without compromising the international competitiveness of the UK tax system. Additionally, the inheritance tax regime has been reformed to include previously untaxed unspent pension funds and to restrict generous reliefs on large estates, thus ensuring that wealthier estates pay an equitable share.
Environmental and Energy Taxes
In line with the government’s commitment to a sustainable future, the Budget includes measures to support the energy transition. The Energy Profits Levy (EPL) is set to increase from 35% to 38%, and certain investment allowances have been removed. These measures aim to ensure that oil and gas companies contribute more significantly to the funding of the energy transition, helping to pave the way for a low-carbon economy. The tax reforms in this area are crucial for balancing economic growth with environmental responsibility.
Business Rates and Corporate Tax Roadmap
For the business sector, the Budget provides a clearer and more predictable framework. Reforms to business rates aim to support sectors such as retail, hospitality, and leisure by reducing the multipliers that have previously burdened these industries. Moreover, the government has confirmed a Corporate Tax Roadmap that caps the rate at 25%—the lowest in the G7—for the duration of the Parliament. This commitment is designed to foster a competitive business environment and encourage domestic and foreign investment.

Supporting Households and Working People
In an era of rising living costs, the Autumn Budget 2024 introduces a suite of measures specifically aimed at supporting households and protecting working people:
Increasing the National Living Wage
One of the most headline-grabbing aspects of the Budget is the planned increase in the National Living Wage. This measure is expected to raise the annual earnings of full-time low-paid workers by over £1,400, directly benefiting more than 3 million workers across the country. By boosting the income of the lowest-paid employees, the government aims to enhance living standards and reduce income inequality.
Household Support Initiatives
To further assist vulnerable households, the Budget earmarks £1 billion to extend the Household Support Fund and Discretionary Housing Payments. These funds will help local authorities address immediate hardships and crises, ensuring that those in need receive timely financial support. This commitment is crucial for maintaining social stability and ensuring that the benefits of fiscal consolidation are shared equitably.
Protecting Taxpayers
Despite the need for additional revenue, the government has made a firm commitment not to raise taxes on working people. Income tax rates, VAT, and personal tax thresholds will remain unchanged, ensuring that the tax burden is focused on higher earners and corporations. This measure is designed to protect the disposable incomes of the majority of households while still achieving the necessary fiscal adjustments.
Fair Repayment Rates and Welfare Reforms
The Budget also includes reforms aimed at making the welfare system more efficient and fair. The introduction of a new Fair Repayment Rate for Universal Credit is expected to allow over 1.2 million households to retain more of their benefits. Additionally, adjustments to the Carer’s Allowance and other working-age benefits will support those on low incomes, ensuring that the welfare system encourages work and self-sufficiency.

Promoting Business Growth and Economic Recovery
The government recognizes that a stable and predictable business environment is essential for economic recovery and long-term growth. The Autumn Budget 2024 introduces several measures aimed at supporting businesses and encouraging private sector investment:
Incentives for Investment
By significantly increasing public sector net investment and providing clear guardrails for capital spending, the Budget is designed to crowd in private investment. The additional £100 billion in public investment over five years is expected to have a multiplier effect, boosting private sector confidence and encouraging companies to invest in new technologies and infrastructure projects. According to forecasts, every £1 of public investment could generate an additional £0.30 in private investment, leading to higher overall productivity and economic output.
Business Rates Reforms
In an effort to alleviate pressure on small businesses and sectors such as retail, hospitality, and leisure, the government is reforming business rates. Lower multipliers and a more predictable rate structure will help these industries manage costs better, thereby encouraging growth and job creation. These reforms are especially important for businesses operating on thin margins, providing them with the breathing room needed to expand and innovate.
Corporate Tax Certainty
The Corporate Tax Roadmap is another significant aspect of the Budget that provides long-term certainty for businesses. By capping the Corporation Tax rate at 25%—the lowest in the G7—the government is ensuring that the UK remains an attractive destination for investment. This certainty not only helps large multinational corporations but also reassures domestic businesses that the fiscal environment will remain stable over the coming years.

Economic Outlook and Long-Term Growth Prospects
The Autumn Budget 2024 is not just about immediate fiscal adjustments—it is also designed to lay the groundwork for sustained economic growth. The Office for Budget Responsibility (OBR) has revised its forecasts, projecting gradual improvements in key economic indicators over the coming years:
Growth Projections
The OBR expects the UK economy to grow by 1.1% in 2024, with growth accelerating to 2.0% in 2025 and 1.8% in 2026. As the effects of the Budget’s measures take hold, long-term growth is forecast to stabilize around 1.5% to 1.6% by 2027-2029. This steady growth trajectory reflects the combined impact of increased public investment, enhanced productivity, and a more stable fiscal framework.
Inflation and Monetary Policy
Maintaining price stability remains a key priority. The OBR forecasts that Consumer Prices Index (CPI) inflation will average around 2.5% in 2024, before gradually declining toward the 2% target in subsequent years. The government’s commitment to fiscal discipline, coupled with a transparent and predictable monetary policy, is expected to help anchor inflation expectations and support a stable economic environment.
Employment and Disposable Income
The Budget’s measures are also expected to positively impact the labor market. While the unemployment rate is forecast to hover around 4.0% to 4.3% in the near term, the long-term outlook remains stable. Improvements in household disposable income, driven by both wage increases and targeted tax measures, will help boost consumer spending—an essential driver of economic growth.
The Crowding-In Effect
One of the most compelling arguments for the Budget’s increased public investment is its potential to crowd in private investment. By creating a more secure and predictable economic environment, the government’s capital spending is expected to encourage additional investment from the private sector. This crowding-in effect is projected to lead to a permanent boost in potential output, translating into higher GDP growth over the long term.

Conclusion: A Blueprint for National Renewal
The UK Autumn Budget 2024 represents a decisive shift in fiscal policy. By focusing on strengthening the fiscal framework, boosting public investment, reforming the tax system, and supporting households and businesses, the government is setting the stage for a decade of national renewal. For accountants, financial planners, and policy experts, the Budget provides a clear roadmap for navigating the evolving economic landscape.
This detailed plan is built on the principles of sustainability and long-term growth. The introduction of the Stability and Investment Rules, along with a comprehensive Charter for Budget Responsibility, ensures that the UK’s public finances are managed prudently. At the same time, the significant increase in capital investment—coupled with targeted support for the NHS, affordable housing, and public services—promises to deliver tangible improvements in living standards and productivity.
For businesses, the combination of fair tax reforms, predictable corporate tax policies, and streamlined business rates is expected to foster a more supportive environment for investment and innovation. Meanwhile, households will benefit from higher wages, enhanced social support, and a commitment to maintaining the tax burden on working people.
In summary, the UK Autumn Budget 2024 is more than just a fiscal plan—it is a strategic blueprint for national renewal. By balancing fiscal responsibility with bold investment initiatives, the government is laying the foundations for a resilient, prosperous, and inclusive economy. For professionals in the accounting and financial sectors, staying informed about these developments is critical for advising clients and planning for the future.
This comprehensive summary of the UK Budget 2024 not only highlights the government’s immediate measures but also underscores its long-term vision for economic growth and stability—a vision that aims to deliver lasting benefits for the UK’s public services, businesses, and households alike.