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Sadiq disappointed Chancellor did not scrap National
Insurance rise altogether
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Insufficient help for businesses struggling to recover
from pandemic
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Government still refuses to adequately fund Transport
for London and Metropolitan Police
The Mayor of London, has warned that the Government’s
Spring Statement fails to meet the needs of Londoners who are
facing a ‘triple whammy’ of energy price hikes, tax increases and
rising inflation
With inflation now above six per cent, Sadiq had called on the
Chancellor of the Exchequer to use today’s Spring
Statement to address the spiralling cost of living crisis, which
is having a dramatic impact on the lives of Londoners,
particularly the poorest households and is being made worse by
the war in Ukraine.
Recently, the Mayor revealed that nearly 80 per cent of Londoners
have seen their cost of living increase over the last six months.
In addition, 34 per cent of Londoners have struggled to pay bills
and 13 per cent say they are going without essentials or relying
on credit.*
While there was some welcome support today, the Mayor believes
the Chancellor should have gone much further. While he is pleased
that the Chancellor has increased the National Insurance
threshold for the lowest earners, Sadiq is disappointed he did
not go further and scrap altogether the 1.2 per cent increase in
contributions that will be introduced in April. He also thinks
the Chancellor should have committed to ensuring that welfare
benefit payments are increased in line with inflation so that
those who are most in need do not receive a real-terms cut.
While the Chancellor did offer some support for households today,
he still refuses to cut VAT on energy bills or introduce windfall
levies on energy companies who have spent years cashing in on
soaring oil and gas prices enabling them to quadruple their
profits.
Nor did the Chancellor provide a more significant package of
measures to support London’s businesses, especially in those
sectors which have been hit hardest by the pandemic and are
taking longer to recover, including retail, leisure and
hospitality.
The Chancellor did not make permanent the lower rate of 12.5 per
VAT for the hospitality and leisure sectors, meaning this will
come to an end in April. Increasing VAT on hospitality to 20%
while energy and food bills are at record highs is a huge missed
opportunity to ease pressures across the economy and accelerate
growth and recovery
Sadiq had called on Government to support the return of
international tourists back to London by reinstating tax-free
shopping for overseas visitors – but again this fell on deaf
ears.
The Mayor has also said the Spring Statement failed to provide
the money to keep Londoners safe, deliver more affordable
housing, tackle poor air quality and meet the ambition needed to
achieve Net Zero and address the climate crisis.
The Mayor of London, , said: “Londoners are
facing a triple whammy of energy price hikes, tax increases and
rising inflation – and this Spring Statement failed to ease this
cost of living crisis.
“It is completely misguided in the current economic climate for
the Government to push forward with its National Insurance
increase for millions of people from April. There was also
precious little in this statement for businesses still struggling
to make ends meet after the pandemic.
“London is the engine of the UK economy and we want to play an
even bigger role in levelling up all parts of the. But if the
Government continues to starve the capital of funding,
particularly for our transport network and police, it will choke
off the whole national recovery.”
The Mayor is also disappointed that the Government still refuses
to ensure the Met is at the necessary strength of 6,000
additional police officers or address the £159m annual shortfall
in funding from the National, International and Capital City
(NICC) grant, which provides additional costs that come with
policing the capital, including diplomatic protection, as well as
policing major events such as protests, concerts, football
matches and state visits.
While the Mayor welcomes the operational support that the
Government has provided TfL during the pandemic, including the
latest agreement to 24 June 2022, the current deal still only
provides short-term funding to enable TfL to continue running
services for a few more months.
Sadiq was therefore disappointed not to learn today of a
significant commitment for future capital investment for TfL,
which will play a critical role in avoiding significant and
damaging cuts to tube and bus services and help the capital to
achieve net zero and reduce air pollution.
While Sadiq continues to support the Government’s Levelling Up
agenda, he remains concerned that the London, which has some of
the most deprived parts on the country is being overlooked for
investment.
He also reiterated his belief that the key to reducing
inequalities and levelling up London will be fiscal freedoms to
generate the capital’s own resources and target them in the most
effective way to the areas of greatest need.
NOTES TO EDITORS:
*https://data.london.gov.uk/dataset/the-rising-cost-of-living-and-its-effects-on-londoners
