Policy and research officer The Chartered Institute of Payroll Professionals (CIPP)
Share this content
CIPP analyses payroll measures announced in 2021 Autumn Budget
iStock_Pay slip_tattywelshie

Autumn Budget 2021: A payroll perspective

by

CIPP policy and research officer Mathew Akrigg analyses announcements affecting payroll professionals.

9th Nov 2021
Policy and research officer The Chartered Institute of Payroll Professionals (CIPP)
Share this content

The economic consequences of the pandemic have played a significant role in the last two Budget announcements, but this Budget saw Sunak take a cautious step away from the emergency support measures that dominated previously, to initiatives designed to boost and support economic recovery in a post-covid era.

The Chancellor was keen to emphasise the role inflation could play in the cost of living over the coming years and talked about two global forces that were driving this. Firstly, the rapid return of economic activity has meant that in many areas, the demand for goods is outweighing supply, putting pressure on the supply chain and producing higher prices.  Secondly, the surge in demand for global energy has also put a strain on prices.  The Office for Budget Responsibility (OBR) anticipates that the consumer price index (CPI) – a measure of inflation, will reach an average of 4% over the coming year.  That would result in inflation hitting its highest level for ten years.

Prior to the Budget, news outlets leaked the announcement that the National Living Wage (NLW) would increase to £9.50 an hour, a 6.6% uplift. Affecting an estimated 2 million workers across the UK, this rise could mean over £1,000 a year for full-time workers on minimum wage. While this is undoubtedly fantastic for employees, there will be some employers who will be concerned about increases in labour costs. In sectors disproportionally hit, such as retail and hospitality, it is feared that this will lead to higher consumer prices or even redundancies.

Additionally, the National Minimum Wage (NMW) for apprentices has been brought in line with that of under 18s.

Register for free to continue reading

It’s 100% free and provides unlimited access to the latest accounting news, advice and insight every day. As well as access to this exclusive article, you can:


Content lock down, tick icon

View all AccountingWEB content


Content lock down, tick icon

Comment on articles


Content lock down, tick icon

Watch our digital shows and more

Access content now

Already have an account?

Replies (1)

Please login or register to join the discussion.

avatar
By Hugo Fair
09th Nov 2021 18:24

A reasonable reflection of a Budget with next-to-no impact on Payroll, but ...

"We also had firm confirmation of the new NI Categories to be used for freeport and veterans NI, changes that are coming into effect from the 2022-23 tax year" isn't strictly accurate.
The NI for veterans scheme is already in effect (from start of the 2021-22 year), even though there's no facility to report it via RTI (due to lethargy by HMRC) until next year (as retrospective data)!

Thanks (1)