A Budget which puts the next generation first

This week the Chancellor delivered his eighth budget to Parliament. Alongside my work as MP for Norwich North, I have made it a priority to ensure young people in Britain are at the top of the political agenda. I welcome the Chancellor’s recent budget which, in his own words, puts the next generation first.

 

It puts the next generation first in three ways. Number one, by supporting saving through a new lifetime ISA. Second, changes to education to ensure our young people get the best start in life. Finally, securing a strong economic recovery, the central cornerstone to opportunity.

 

One of the biggest concerns I hear from the young people I talk to in Norwich is that it’s just too difficult to save for the future. Never mind retirement, most are struggling to put together a deposit for a home and many have no savings at all. The Introduction of the new Lifetime ISA for under 40s means you won’t have to choose between saving for your first home or for your retirement, you now have the opportunity to do both.

 

For every £4 you save, the Government grants you £1. So if you put in £4,000 a year the Government would give you £1,000 every year until you’re 50. To ensure people get the best advice about saving, we’re increasing the tax free allowance that employers and employees can use to pay for advice to £500. These changes are particularly welcome, especially given that many young people haven’t had such a good deal from pensions.

 

The ISA limit will rise from just over £15,000 to £20,000 for everyone. We’re also raising the tax free allowance on income tax. From April 2017 the tax free personal allowance will rise to £11,500, a tax cut for 31 million people across the UK, which means a typical basic rate taxpayer will be paying over £1,000 less income tax then when we came into government five years ago.

 

Taken together, these reforms mean working people will keep more of the money they earn and help young people save for their futures. For all the young entrepreneurs out there, we’re abolishing National Insurance Contributions for the self-employed, creating a simpler tax system for Britain’s 3 million strong army of self-employed workers.

 

To ensure our young people get the best start in life, money will be provided for every school in England to become an academy by 2020, or to be in the process of conversion. I was particularly pleased to learn that 90% of schools will benefit from the new National Funding Formula before the end of this Parliament. I was schooled at Norfolk comprehensives myself, so of course I want to see all schools in Norwich delivering a high quality education for our children.

 

Being an academy can help schools serve their students and the whole community better. It gives the head teacher and their team more control over their decisions and resources, allowing them to be creative, innovative and practical.  They can do what works and what will most help their students, rather than being dictated to by the Council.

 

Our own EDP analysed last year that, overall, sponsored academies have improved. A third of secondary schools in Norfolk need to get better. That’s worse than elsewhere in England. That’s not just a big number – it’s 13,000 real people who deserve better.  You only get one chance at education, and if wasted, you risk being held back your whole life. I welcome these reforms which will boost the life chances of children and young people here in Norwich.

 

The Government will also look at the case for teaching some form of maths to 18 for all pupils. Maths is a vital skill, and it is particularly important that children in Norwich have the opportunity to do well in this core subject, especially if they are to make the most of the growing investment in engineering in our city.

 

Finally, all of these reforms rest upon the success of a strong British economy. While we cannot be immune from tremors in the global economy, we are not in a straightjacket either and this Budget ensures we are prepared. That’s what our long term economic plan has been all about – building resilience. Fixing the roof when the sun is shining, not leaving it for our children to clear up the mess.

 

I was interested to read the new analysis showing that if we hadn’t taken the tough decisions we did in 2010 borrowing would be £930 billion more by 2020. Thanks to the action we’ve taken the deficit will now fall to 2.9 per cent of national income in 2016/17 – down from 10.2 per cent in 2009/10. We now anticipate a surplus of 0.5 per cent of GDP in 2019/20 or £10.4 billion – higher than forecast at the Autumn Statement.

 

These numbers are not just abstract figures. It is real money which must be paid back, and money which in all likelihood will be paid back by the next generation. We have a moral responsibility to ensure this burden is as light as possible.