How might the Autumn Statement help the JAMs?

We’re going to be seeing a lot more about JAMs after this Wednesday. These are the “Just About Managing”, a yet to be defined demographic that the Prime Minister is said to want to focus on during her Premiership.

Research carried out by Turn2us last year found that 87% of those on low incomes had seen no improvement in their financial situation over the last year. JAMs (Just About Managing) define the increasingly large section of society that may well be in work but are struggling to pay for essentials such as food, heating or – more commonly – rent. Not only are they unable to save, but the financial pressures that we are seeing every day from people who we deal with puts people into a very precarious situation, where a change in their circumstances, such as redundancy or the death of a loved one, can push them into poverty.

But who are the JAMs and what policies might we see this Wednesday in a bid to offer them support?

Not a giveaway

As is now traditional, the Autumn Statement will coincide with updated projections from the Office of Budget Responsibility. Based on phrases such as “eye watering debt” used by the Chancellor over the weekend, it looks like belts will continue to be tightened and, with an election not likely to be called until 2020, it is doubtful that the government will play its trump hand straight ahead. But with inflation predicted to rise and further pressures being mounted on households, there may be a few sweeteners to keep people happy.

Household incomes

It looks likely that the government will continue the policy of raising income tax thresholds for those on lower and middle incomes, with the tax-free personal allowance reported to be increased from £11,000 to £12,500 and the higher-rate going from £43,000 to £50,000.

There’s speculation too that the government may soften its stance on Universal Credit reductions, with the Centre for Social Justice, headed up by former Department for Work and Pensions (DWP) Minister Iain Duncan Smith, backing calls for a rethink. 

There has also been much discussion about breaking the triple lock on pensions. The cross party DWP Select Committee recently recommended that the government scrap the policy which ensures that pensions rise each year by the highest of inflation, earnings growth or 2.5%. However, this will be a controversial move and one that the Chancellor will try to avoid if possible.

Cost of living

With the fall in the value of the pound after Brexit, many have raised concern over increasing prices, and the government is likely to be under pressure to offset this added burden on family finances. One idea mooted is that the Chancellor may decide to freeze fuel duty, something currently set to rise by 2p as part of the fuel duty escalator. Others have suggested that a range of policies to reduce the cost of childcare might also been thrown into the mix.

Fuel bills might also get a mention. The 2016 Budget stated that “Department of Energy and Climate Change (DECC) will take steps to improve the customer experience and coherence of its policy delivery” and explained that it would set out future consumer facing functions in this Autumn Statement. However, with DECC now disbanded, this may no longer be the case.

However, there has also been discussion that the Chancellor may seek to make savings on tax-free benefits offered by “salary sacrifice” schemes such as health checks, parking and gyms. The schemes work by employers agreeing to reduce cash pay in return for certain benefits.

Housing

Housing continues to be a major issue and one that successive governments have failed to grapple. Pressure has been mounting to provide greater support to young people who are Just About Managing who are unable to get onto the housing ladder.

Communities Secretary Sajid Javid has hinted that might be support in this area, as well as the Chancellor himself raising house building more broadly over the summer. This will likely include the re-announcement of the £3bn ‘Home Builder Fund’, first mentioned by Sajid Javid at the Conservative Party Conference. The housing white paper is due to be published alongside the Statement.

Civil Society

Charities have increasingly seen themselves on the receiving end of a number of Treasury giveaways in recent years, though no doubt some will claim that this only goes some way to compensate for the increase in demand that the sector has seen in recent years. Last year’s Autumn Statement saw the announcement of the Tampon Tax Fund, with “charities working with disadvantaged women and girls” encouraged to apply for some of the £15m, equivalent to the VAT raised by the HM Revenue and Customs (HMRC) from the sale of sanitary products. The Department for Work and Pensions also launched a competition for an experienced grant maker to distribute £3m, with the successful applicant expected to be announced in the 2016 statement.

Military and emergency services charities are also likely to be mentioned after being invited to apply for funding from fines levied on banks that manipulated Libor, the inter-bank lending rate. The deadline for application was set for the 15 September 2016 in order to “allow enough time to consider all bids ahead of the Autumn Statement”.

Turn2us support

Turn2us provides a free Benefit Calculator that can tell you what Welfare Benefits and Tax Credits you may be entitled to, with updates on any changes that might affect that you. In addition we also have a Grants Search tool where you can access support from one of 3000 charitable funds.