2012 Budget - Key Measures

The Budget 2012 announced a wide-range of reforms to the tax system to reward work and support growth. The government believes that these reforms will lower headline rates, diversify and broaden sources of revenue, and reduce reliefs based on the principle that the tax system should be fair, efficient and simple.

'The Government is committed to driving through the measures announced in The Plan for Growth and Autumn Statement 2011, and is taking further steps in this Budget to stimulate investment, exports, enterprise and the employment market.' - HM Treasury 2011

In relation to the Voluntary and Community Sector the following are to be implemented:

  • £40m of additional funds for the advice sector
  • Cuts of £10bn to welfare
  • Tax allowances for pensioners reducing
  • Introduction of regional wage rates for employees in parts of the public sector
  • Introduction of a cap on income tax relief for anyone claiming more than £50,000 a year.
  • Measures undertaken to simplify the administration of Gift Aid particularly in the context of charity shops
  • Internal review undertaken to examine the financial barriers to social enterprise
  • Investment in the Northern Rail Hub

It appears that the 2012 Budget is aimed predominantly at business and gives little attention to the important role of the voluntary sector within the economy. It is encouraging to see the announcements made around the Northern Rail Hub investment but there is still a long way to go to decrease the disparity in funding between the South East and the North. Finally the emphasis on economic recovery should not be at the expense of the natural or built environment. Some are already calling it a 'polluters' charter' that favours growth and business and excludes the environment.

Judy Robinson, Chief Executive of Involve Yorkshire and Humber said: "Fairness and equality is at the heart of the charity sector. Our members work to support disadvantaged people and communities all over Yorkshire and Humber. So, Involve is concerned that the impact of the budget on pensioners, benefit claimants and on  public sector pay in Yorkshire will be to increase inequality not to create a high quality of life for all. We are alarmed too that targeted measures to combat youth unemployment and to promote economic development in the region are few and far between. This will mean that the north continues to get an unfair deal. Charities across the region will need to rise to the challenge and find new ways to support disadvantaged people - but it's an uphill task with reduced resources all round."

NCVO – have produced a Scorecard that details what the Budget means to the Charity Sector which you may find useful. 

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