Changes to look out for from the Spring Budget 2023

Getting people “back into work” is the main focus of Chancellor Jeremy Hunt’s Spring Budget announced on 15 March 2023. The reform will impact employees and employers alike, so here’s 5 key takeaways from the announcement:

1. Childcare for working parents

Mr Hunt announced an increase in the funding for childcare, encouraging parents to return to work. There will be 30 hours of free childcare available for every child over the age of nine months for every working parent in England. Changes will be rolled out in two stages:

  • ­April 2024 will see 15 hours of free childcare for working parents of two-year-olds; and
  • September 2024 will see 15 hours of free childcare for working parents of children aged nine months to three years.

Schools will also benefit from increased funding for wraparound care helping parents with school-aged children, return to work.

2. Helping the disabled into work

A new voluntary employment scheme, called Universal Support in England and Wales will be set up for disabled people with health conditions returning to work. Funds of up to £4,000 for each person will be available, for those who want to work with existing job vacancies.

Employers are advised to review their recruitment practices to ensure jobs in the workplace are available and inclusive of all. Wherever possible, positive action should be taken to appeal those who want to return to work, with their disability.   

3. Apprenticeships for over 50s

The government will launch a new type of apprenticeship for the over 50s, in a bid to encourage “older workers” back into work.

The “Returnships” will be enable individuals to attend skills bootcamp and skills programmes designed to make it accessible to older workers, supporting them back into work. Employers will need to consider the terms of the employment for these candidates more carefully and differentiate them from Apprenticeships.

4. Lowering Pension Tax

In a bid to support people to remain in work for longer, there will be an increase in the tax-free pension annual allowance from £40,000 to £60,000. This will encourage highly skilled workers to remain in employment and not be tempted by early retirement.

The lifetime allowance charge which restricted the maximum amount of tax-relieved pension savings for an individual, will be removed and later abolished., saving many employers administration costs. 

5. Occupational Health Support

SME’s to gain more support from the Government through a scheme which helps with the cost of purchasing Occupational Health services. Particularly encouraging employees with health conditions such as mental health, musculoskeletal conditions, and cardiovascular disease to remain in work or return to work with appropriate adjustments.

Employers are reminded to seek Occupational Health referrals wherever possible to understand what changes in the workplace are possible to keep employees at work and provide support with their health conditions. Failure to consider reasonable adjustments puts employers at risk of discrimination. 

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