The main measures announced were piecemeal and targeted, and paid for through a mix of tax rises and spending cuts.  Read our analysis and sector briefings to find out how the Budget could impact your business.

Overview

The Chancellor had more wiggle room within his spreadsheets, thanks to stronger than expected economic growth and higher tax receipts.  But, as expected, there were no splurges, rabbits or much in the way of excitement -  just as he had planned.

Hammond had always intended this last Spring budget to be a low-key affair and made clear that there would be no big giveaways, particularly given the high level of debt and borrowing, combined with his desire to build a Brexit war chest.

And so the main measures announced were piecemeal and targeted, and paid for through a mix of tax rises and spending cuts.

Most of them had been well trailed in advance.

There was action to support smaller firms facing steep rises in business rates, following  frenetic lobbying by business groups, pubs and restuarants in recent weeks. Announcing yet another  consultation, Hammond confirmed that business rates are here to stay but that the Government would develop a digital tax system to reflect the shift from bricks and mortar.

On alleviating the social care crisis which threatens to engulf the NHS, Hammond pledged

£2bn over the next three years with £1bn available in 2017/18. A Green Paper will follow but he ruled out  “exhuming Labour’s hated death tax.”  And he didn’t make the mistake of failing to mention the NHS this time round, declaring: “We are the party of the NHS.”

Perhaps the biggest potential headache could come from the planned changes to the tax treatment of the self-employed.  Announcing moves to reduce the gap between the employed and self employed by raising National Insurance contributions from the latter, Hammond appears to have broken a 2015 Conservative manifesto pledge not to raise VAT, NI or income tax. The move will raise a modest £145m but will affect self employed people earning just over £16k a year, and rather dents the Conservative’s reputation as the party of the entrepreneur. 

Other announcements:

There was further detail on where the £300m announced for  research and development in November would be going, including investing in 1000 new PhDs, disruptive technology, robotics and artificial intelligence and 5G.

On education, more free schools will be created alongside a  new vocational T- level – aimed at ensuring technical qualifications enjoy parity of esteem with A levels.  

There were details on how £1.3bn of  transport funding announced in the Autumn Statement would be spent – including £113m for motorway ‘pinch points’ in the North and Midlands, and the opening of a new £690m fund for local authorities to finance regional transport schemes.

No doubt we’ll have to wait until November for  the big ticket policy announcements when the budget becomes an annual fiscal event again. But while the pubs may cheering the Chancellor today, it’s fair to say this Budget was pretty small beer.

To find out what the Budget means for your business, take a look our sector specific briefings:

• Business Environment: The Chancellor appeased Conservative backbenchers and the vocal small business lobby with £435 million reliefs on business rates. However, he’s potentially gone to battle with the self-employed – breaking a manifesto pledge by raising National Insurance Contribution rates.
• Education and skills: The Chancellor put education and skills at the heart of his ambition to boost productivity, announcing further funding for free schools and schools maintenance, and introducing new T-Levels in order to boost the status of technical qualifications. A Schools White Paper is expected to be published in the coming weeks
• Energy: The Chancellor exceeded expectations of a light budget for the sector by omitting any reference to energy in his speech; however, in one of the more significant announcements in recent years, the document itself contained news that the Treasury is to replace the Levy Control Framework with a new set of controls to be set out later this year. Green businesses will be relieved that the Government also reaffirmed its commitment to carbon pricing, with details on prices for the 2020s due in the Autumn Statement.
• Health and social care: Social Care was a headline spending commitment for the Chancellor in this Budget, with a £2bn sticking plaster going to English councils over the next 3 years, and £1bn of this available straight away in 2017-18.  Options for longer term reform of social care financing will be set out in a green paper later this year.
• Housing: Coming hot on the heels of the Housing White Paper and policy announcements in Autumn Statement to increase housing supply, there were no significant policies or funding unveiled by the Chancellor.  The Chancellor made some minor adjustments to property taxation.
• Transport: There were details on how £1.3bn of new transport funding announced in the Autumn Statement would be spent – including £113m for motorway ‘pinch points’ and the opening of a new £690m transport fund for local authorities. The Chancellor also announced an agreement with the Greater London Authority on the devolution of further powers, including on action to tackle congestion and piloting new infrastructure funding models. 

The UK Economy:

• GDP grew by 1.8% in 2016
• OBR now forecasts GDP growth of 2.0% in 2017, 1.6% in 2018, and then 1.7% in 2019, 1.9% in 2020 and 2.0% in 2021
• Fall in Sterling expected to push inflation to 2.4% in 2017 and 2.3% in 2018, before falling back to 2.0% in 2019
• OBR expects that borrowing will fall to 0.7% of GDP by 2021-22, which is forecast to be the lowest level as a share of GDP in two decades
• Debt is expected to peak at 88.8% of GDP in 2017-18, before falling to 79.8% of GDP in 2021-22.
• Total Managed Expenditure is expected to be around £802 billion in 2017-18.
• Public sector current receipts are expected to be around £744 billion in 2017-18.

The response to the Chancellor’s 2017 Spring Budget:

• Jeremy Corbyn: “A Budget of utter complacency about the state of the economy.”
• Carolyn Fairbairn, Director General of the CBI: “Great to see focus on technical education for young people - a breakthrough Budget for skills.”
• George Osborne MP: “Well done Phil. Sound money and fiscal responsibility are the only secure foundations of a fair and strong economy.”