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Autumn Budget "A significant shift of fiscal and economic policy"

What the budget means for community organisations.

On 30 October 2024, the Chancellor’s autumn budget was announced. The Chancellor framed this budget as a plan to restore the economy and deliver change by protecting working people, fixing the NHS, and rebuilding Britain. The address outlined seven key areas – aiding economic growth; investing in infrastructure; promoting devolution; tackling unemployment; empowering small and medium enterprises (SME’s); driving innovation in scientific research; and maximising the benefits of clean energy supply.

However, against the backdrop of what the government states is a £22bn black hole found in the public finances, much of the focus of this budget was centred around plugging this gap. This was most notable in the increase of employer’s National Insurance Contributions (NICs) by 1.2% to 15%, and the reduced threshold when these are due from £9,100 to £5,000.

We recognise the unintended consequences this may have on many community organisations with ongoing funding challenges and are calling on the government to address this. We have signed NCVO and ACEVO’s open letter to the Chancellor calling for urgent action on the planned increase to employer NICs for the voluntary sector.

We also urge Locality members to complete this survey by Charity Finance Group to help understand the impact on the sector of the increases to both employer NICs and the National Living Wage.

Locality CEO, Tony Armstrong, responded to the budget as follows:

“Rachel Reeves’ budget marked a significant shift of fiscal and economic policy. We welcome the government’s investment to improve health, housing, economic opportunities and local government services. The promise of an end to austerity will be welcomed by our members, although this needs to be felt in real terms. Like our public services, community organisations have faced multiple crises, increased demand and tighter budgets. Many will find it difficult to cope with additional staffing costs without new income sources.

"Much of the budget’s impact on communities will be in the detail. We do know that the government has committed to work in partnership with the VCSE sector and this needs to be delivered on. Community organisations play a crucial role in driving economic development, providing vital services and bringing people together. We look forward to working with the government on specific investment and support so that community organisations can really help their neighbourhoods thrive."

"The promise of an end to austerity will be welcomed by our members, although this needs to be felt in real terms."

Tony Armstrong
Tony Armstrong
CEO, Locality