Five things the Chancellor could say in today's Budget that would benefit the North East

THE Chancellor Rishi Sunak will make his Budget speech this afternoon.

Here's five things to look out for that could benefit the North East:

Freeports - it is expected that Mr Sunak will announce the locations of freeports - special economic zones with low taxes that would help stimulate regional growth.

More than 30 areas in England have reportedly bid to become a freeport

He's also expected to announce more funding to help the UK meet its decarbonisation goals.

This includes a bid for Teesside the UK's biggest Freeport - which could lead to 18,000 new jobs being created in Teesside.

Economic analysis carried out for the bid found that the Teesside Freeport could create more than 18,000 skilled, good-quality, well paid jobs over the next five years.

Covering 4,500 acres, the equivalent of 2,550 football pitches, the Teesside Freeport will be the biggest in the UK.

Rather than restricting the Teesside Freeport to just one area, the bid, put together by Tees Valley Mayor Ben Houchen, covers sites across the region, including Teesworks, Wilton International, Teesside International Airport, the Port of Middlesbrough, the Port of Hartlepool, Liberty Steel and LV Shipping. By spreading out the Freeport maximum benefit can be gained for the people of Teesside, Darlington and Hartlepool.

Areas given Freeport status within the region would benefit from a wide package of tax reliefs, simplified customs procedures, streamlined planning processes to boost redevelopment and government support to promote regeneration and innovation.

The Teesside Freeport bid is designed to turbo-charge what the region already has a world-renowned reputation for excellence in, such as manufacturing, engineering, chemicals and processing.

The new free-trade zone would boost the local economy by £3.2 billion and increase inward investment into Teesside, Darlington and Hartlepool by over £1.4 billion.

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Furlough and employment - it has been predicted that Mr Sunak will extend the furlough scheme. It has been reported that this could be extended until June 30.

The scheme, which pays 80 per cent of workers' wages is set to expire in April.
Business Secretary Kwasi Kwarteng has signalled that Mr Sunak will announce a further extension of the furlough scheme in the Budget.

Yesterday Mr Kwarteng told BBC Breakfast: “I think the Chancellor has already indicated that we will be extending furlough.
“I think that has been part of a public announcement. I think there will be other measures that we will see tomorrow.”

North East businesses revealed they want to see an extension to furlough after almost half used the scheme.

Regional SMEs are calling on the Chancellor to announce an extension to the furlough scheme when he delivers his Budget today, according to the latest data from Lloyds Bank’s Business Barometer research.

When asked which initiative would be most beneficial to helping their firm trade this year, almost a third (31 per cent) of regional SMEs said an extension to the Coronavirus Job Retention Scheme or the introduction of a new scheme to help them retain employees.

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Covid support - reports suggest Mr Sunak will extend the business rates holiday - brought in last year to support shops - beyond its current end date of March 31 and into the summer.

The Chancellor is likely to set out his vision for a post-Covid economy, which could mean more money for "levelling up" different parts of the UK - including the North East.

The Tory manifesto in 2019 promised not to raise the rates of income tax, National Insurance or VAT. But Mr Sunak is reported to be considering a freeze in the thresholds at which people start paying income tax or move into higher brackets – meaning more people would be dragged into those categories as wages increase.

Freezing the £12,500 threshold at which people start paying tax would bring in an estimated £5 billion and freezing the £50,000 threshold where the 40p rate kicks in would bring in £1 billion by 2024-25.

Corporation tax also appears in line for a hike, with Joe Biden’s plan to raise taxes across the Atlantic giving the Government political cover to increase the rate while still maintaining international competitiveness.

Mr Sunak is thought to be considering an increase in the tax on profits from 19p in the pound to between 23p and 25p.

The UK’s coronavirus vaccine rollout will receive a £1.65 billion boost to help it meet the target of offering a dose to every adult by July 31.

Mr Sunak will use today's Budget to detail the plan for the new cash to aid the programme, which is a key factor in successfully easing lockdown restrictions.
Mr Sunak will also divert £22 million to fund a “world first” trial to test if different vaccines can be used together, or if a third dose is effective, the Treasury said.

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Hospitality - pubs, restaurants, shops and other businesses hit hardest by the coronavirus pandemic will be boosted by a £5 billion grant scheme to help them reopen as the lockdown is eased.

Chancellor Rishi Sunak will detail the “restart grants” worth up to £6,000 per premises to help non-essential retailers reopen and trade safely at today's Budget.
Hospitality, hotels, gyms, as well as personal care and leisure firms, will be eligible for up to £18,000 per premises as they are due to open later under the plans for easing lockdown.

The Treasury estimates 230,000 firms will be eligible for the higher band, which will be awarded based on their rateable value, and 450,000 shops will also be able to apply.

Labour's Jessie Joe Jacobs said: "The high streets are the beating hearts of our communities and they must be helped to recover and flourish as part of a brighter future."

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Universal Credit - the £20-a-week uplift to Universal Credit are set to be extended at the Budget after Mr Sunak promised to keep emergency economic support in place for as long as lockdown measures are still in force.

The additional boost to Universal Credit is due to end this month.
Mr Sunak has refused to confirm the future of the scheme ahead, but has heavily hinted he is preparing to extend the uplift until the summer or longer as lockdown restrictions continue across the UK.

MPs warned that the £20 weekly increase to Universal Credit payments must be extended for at least a year to prevent hundreds of thousands of families plunging into poverty.

It has been described as a lifeline for those struggling, is in place until the end of March.

A new report from the Work and Pensions Committee argues it must be kept in place for another year “at the very least”, if the Government does not make it permanent.

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