Worcestershire Arts Partnership Blog

Friday, 10 July 2015

Budget announcement - July 2015

On 8 July 2015, the Chancellor George Osborne delivered his seventh Budget. Below is a summary of his main announcements, although bear in mind we are still working through the detail and its implications for us as a council and our residents.


The deficit is planned to be cut at the same pace as during last Parliament, securing a budget surplus a year later than planned in 2019-20. We expect that the final steer on where further reductions will fall will not be available until the autumn when the Spending Review will be published. This will provide us with a better indication of our funding levels over the next three or four years.


The main points from yesterday's budget were:

·         A new National Living Wage of over £9 an hour by 2020 for the over 25s. This will be introduced from April 2016, starting at £7.20 an hour

·         Public Sector Pay Rises capped at 1% per year for the next four years

·         The tax-free Personal Allowance will be increased from £10,600 in 2015-16 to £11,000 in April 2016

·         The dividend tax credit (which reduces the amount of tax paid on income from shares) will be replaced by a new £5,000 tax-free dividend allowance for all taxpayers from April 2016. Tax rates on dividend income will be increased

·         The higher rate threshold (40%) will increase from £42,385 in 2015-16 to £43,000 in 2016-17

·         Increased NHS funding of £8 billion by 2020

·         Three million new apprenticeships will be created by 2020, funded by a levy on large employers

·         30 hours of free childcare will be offered to working families with 3 and 4 year olds from September 2017 which is an increase from the 15 hours they are currently offered

·         £30m package of support is available to speed up the adoption process for children in local authority care

·         The Treasury said it was working towards devolving powers over transport, economic development and some health spending to Sheffield, Liverpool, West Midlands and Leeds. Officials said they were also “making good progress” towards a deal with Cornwall. Exact details are expected to be published with the autumn Spending Review.

We still anticipate that broadly the Council will continue to need to achieve around £25m savings on average each year until at least 2019/20. It is likely that we will still need to wait until December when the provisional Local Government Finance Settlement is published before we know with certainty the precise impact on Worcestershire. Obviously myself and the finance team will keep you informed as detail becomes known.

Kind regards,



Clare Marchant | Chief Executive | Worcestershire County Council

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