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What could investors expect from Hunt’s autumn statement?

30/10/2023

The 2023 Autumn Statement is just around the corner: November 22nd is the date when Jeremy Hunt will present his Statement to Parliament. The big surprise in this year’s Spring Budget was the scrapping of the pensions lifetime allowance – but will the Autumn Statement be quite so dramatic? 

There are suggestions that there are three areas of interest to investors that are on Hunt’s radar, and which could well make an appearance in the autumn statement. These are: 

 

  1. The state pension triple lock

Introduced in 2010, the state pension triple lock is a guarantee that state pensions will increase in line with average earnings, inflation or 2.5% – whichever measure is highest. Since its launch it has been divisive within the Government – and this year it is mooted that high average earnings could boost state pensions to over £11,500 per year

However, with Sunak having publicly committed to maintaining the triple lock for 2024-25, it is unlikely that the Conservative government will break a manifesto pledge by ditching it. 

 

  1. Inheritance tax reforms

Reports state that Hunt is considering reducing the rate of inheritance tax in his Autumn Statement – with a longer term view of abolishing it altogether. While this could be seen as a favourable move for many individuals and investors, it is worth remembering that inheritance tax nets around £7bn per year for the Government: money that would need to be raised elsewhere if inheritance tax was abolished.

 

  1. Changes to the ISA landscape

In an interview with MoneyWeek, HM Treasury stated that “HM Treasury is receptive to ideas of how we can make ISAs more attractive to encourage people to develop a savings habit and to invest in a way that works for them.” There are various suggestions as to how this could happen – including combining different ISA types in a bid to simplify the market. However, some believe this will actually complicate, rather than simplify, matters. 

It has also been suggested that Hunt could announce an additional allowance for those investing in UK companies: an allowance which would be on top of the existing £20,000 annual ISA limit. While this could give UK stocks a boost, would Hunt be better off increasing limits for everyone instead?

 

“Stable Rise Limited is not authorised or registered by the Financial Conduct Authority. The marketing materials are not intended to provide financial advice nor promote any individual financial products.”

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