Autumn statement 2012

These are main relevant changes, not already officially announced, based on the Chancellor's speech and the accompanying budget documents:

Benefits uprating

• Jobseeker's Allowance; Employment and Support Allowance; Income Support; applicable amounts for Housing Benefit; Maternity Allowance; Statutory Sick Pay; Statutory Maternity Pay; Statutory Paternity Pay; and Statutory Adoption Pay will be uprated by 1 per cent for three years from April 2013. The disability, carers and pensioners premia in these benefits and the support component in Employment and Support Allowance, will continue to be uprated by prices.
• Disability and carers benefits will continue to be uprated in line with prices.
• Child Benefit will be frozen in April 2013, as set out in the June Budget 2010, but will be uprated by 1 per cent for two years from April 2014.

Housing costs

• In April 2013 Local Housing Allowance rates will be uprated as previously announced. In April 2014 and April 2015 Local Housing Allowance rates will be uprated by current policy, subject to a 1 per cent cap, with exemptions for rates in those areas in which rent increases are highest. 30 per cent of the potential savings from this measure will be reserved to fund the exemptions in these two years.
• Support for Mortgage Interest (SMI) - Temporary changes to SMI are extended until 2015-16 for working-age SMI claims. The waiting period will remain at 13 weeks and the working-age capital limit will remain at £200,000 until 31 March 2015. (26)
• Housing payments for those in supported exempt accommodation will be disregarded for the purpose of the benefit cap. Funds available for Discretionary Housing Payments will be reduced by £10 million in 2013-14 and 2014-15, and by £5 million in 2015-16 and 2016-17, to fund this measure.

Income tax

• In 2014-15 and 2015-16 the higher rate threshold for income tax will increase by 1 per cent rather than inflation. In 2014-15 the threshold will be £41,865 and in 2015-16 it will be £42,285.
• The Government will adjust the basic rate limit for income tax such that the higher rate threshold above which individuals pay income tax at 40 per cent increases by 1 per cent in 2014-15 and 2015-16. The upper earnings limit and upper profits limit for NICs will increase to stay in line with the higher rate threshold.
• The Government will raise the tax-free personal allowance by a further £235 to £9,440 in 2013-14 and pass on equal gains from this further increase to higher rate taxpayers, who receive a personal allowance.
• The Government will introduce legislation to exempt gains on up to £50,000 of shares acquired by employees taking up the new employee shareholder status from capital gains tax from April 2013.

The Government is also considering options to reduce income tax and NICs liabilities that arise when employee shareholders receive the shares, including an option to deem that employee shareholders have paid £2,000 for shares they receive. This option would mean that the first £2,000 of shares received under the new status would be free from income tax and NICs.

Pensioners

• Additional State Pension will continue to be uprated in line with prices.
• Basic State Pension will increase by 2.5 per cent in April 2013.

Tax Credits

• Child Tax Credit and Working Tax Credit will be uprated by 1 per cent for three years from April 2013 with some exceptions. The couple, lone parent and child elements will be uprated by 1 per cent for three years from April 2013. The basic and 30 hour elements will not be uprated in 2013-14 as set out in Spending Review 2010 but will be uprated by 1 per cent in 2014-15 and 2015-16. All disability elements will continue to be uprated by prices each year.
• There will be a package of measures to reduce tax credits error, fraud and debt. This includes:

1. requiring evidence from households reporting high childcare costs;
2. requiring evidence provided by households each year for children aged between 16 and 19 to ensure their Child Tax Credit payments continue; and
3. changing the information technology to allow debt from an individual's old tax credit award to be recovered through their current tax credit award.

Welfare reform

• Parameters for Universal Credit have been set. These parameters will be confirmed in regulations on 10 December 2012. The earnings disregards will be set for April 2013 and increased by 1 per cent in April 2014 and April 2015.
• DWP will bring forward further details about Personal Independence Payments.

Disability Rights UK welcomes some protection from very low rises in some benefits for disabled people, but we are very disappointed to note:

• That ESA only supports disabled people but is not classified as a 'disability benefit' and recipients now face a 1% increase in basic help for the next three years - despite higher living costs (including for prescriptions and other essential aids and equipment);
• We are also concerned that disabled people receiving other (generic) benefits, eg local housing allowance, are also likely to be disproportionately hit by caps to uprating. We are also seeking clarification on whether the funding for local enterprise partnerships will include criteria to ensure investments prioritise growth in jobs for disabled people (including disabled-led enterprises and investing in accessible premises for example).
• That social care spending is unmentioned - with no financial settlement but further cuts in Government funding for councils it is inevitable that disabled people and carers will lose help altogether or face ever higher charges for very basic support. The new Spending Review (in 2013) is tasked with cutting a further £10 billion from public spending, including council grants;
• That a new 'Benefit Up-rating Bill' may politicise welfare spending further - despite growing evidence of negative national narrative on benefits contributing to hardening attitudes towards disabled people who require support (both in and out of work);
• That disabled people must wait longer to discover what the rates of payments will be for PIP from 2013;
• That the Government is axing a further £3.7 billion from welfare spending under this Autumn Statement despite disabled people already being the Hardest Hit from existing welfare cuts; and
• That there is no information on any additional support to help disabled people enter and/or retain work - despite falling numbers receiving Access to Work assistance and young disabled people being twice as likely to be 'NEET' (Not in Education, Employment or Training).