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Spring Budget 2024: what HR wants

Hunt: UK business must close the productivity gap
HR hopes Jeremy Hunt will reform IR35 and childcare in the Spring Budget

Ahead of the Spring Budget on 6 March, HR hopes that chancellor Jeremy Hunt will make changes to skills training, IR35, childcare and the regulation of umbrella companies.

This time next week, chancellor Jeremy Hunt is set to make his Spring Budget announcement.

The budget follows employees demanding increased support from employers amid the cost of living crisis, estimations that the state pension age will need to rise to 71 by 2050, and continued concerns about skills shortages.

We found out what HR wants to hear from the chancellor in the upcoming announcement.

Skills training

Concerns about skills shortages have continued as the workforce ages, absence from long-term sickness rises and employers struggle to fill vacancies.

Liz Sebag-Montefiore, founder of 10Eighty, told HR magazine that she hopes the chancellor will invest in skills training to remedy the skills problem.

She said: “Upskilling our workforce and investment in reskilling are crucial.

“The key to future growth and prosperity lies in skills development, so I hope the chancellor will incentivise more flexible training so we can address skills shortages, which are a serious problem in many sectors.”

Recent research by SAS, an AI and analytics software provider, revealed that HR had benefitted most from government grants for AI, which it suggested was due to organisations needing support when implementing AI in their HR function.

Read more: Adult career guidance could end skills shortage, report says

Sebag-Montefiore added that technological skills should be invested in most.

She continued: “We need to train people in skills for the future: coding, AI, robotics, automation, VR and other tech skills, especially given the rate of technological developments and the rapid uptake of AI-enabled systems.”



Angela O’Connor, CEO of the HR Lounge, said that she wanted to see the end of the IR35.

IR35 reform was initially pledged under Kwasi Kwarteng’s chancellorship, which Jeremy Hunt then rolled back.

Speaking to HR magazine, O’Connor said: “I would love to see the end of IR35, which is overly complex, badly constructed and hugely unpopular.

“If we want to invigorate business, let’s free up the contractor market and get rid of this fatally flawed legislation.”

It was hoped that the previous budget in autumn 2023 would reform IR35, but this was not the case.


Childcare and child benefits

The government-announced 15 hours of free childcare for working parents of two-year-olds is due to be introduced from 1 April 2024, but the scheme has caused confusion.

Sebag-Montefiore added that Hunt could improve how easy the childcare system is to navigate.

She commented: “Other things Mr Hunt could do that would make working life easier would be improving childcare support and making it easy to navigate.

“A provision is no use if there are no providers available; the current system is too bureaucratic for both parents and childcare providers.

“Childcare in the UK is too expensive for many families; we lose too many women from the workforce due to the scarcity of affordable provision.”

O’Connor continued that she hoped to see reforms to the child benefit system in the upcoming budget.

Read more: Free childcare chaos leaves working parents unsupported

She said: “We are also in a cost of living crisis where staff are struggling to pay their bills; I am particularly concerned about parents trying to budget for very expensive childcare with a child benefit system that does not make sense.”

She noted that this most impacted single-parent households.

She continued: “It is inherently unfair to single-parent households who can only earn £50,000 before being subject to charges, compared to dual-parent households that can earn a joint income of £98,000.

“This needs to change immediately, and would allow more parents  to work and progress in their jobs  without fearing financial penalties.”


Umbrella companies

Paul Newsham, CEO of the Payroll Compliance Authority, a payroll auditor, told HR magazine he hoped for regulation of umbrella companies, but noted it was unlikely.

He said: “Central regulation of umbrella companies is top of my wish list for the upcoming Spring Budget, as it will be for many working with, or in the interests of, the outsourced payroll industry.

“However, being pragmatic, it is unlikely that the government will announce solid plans in this direction given the magnitude of the task and the complexity of the issues at play.”

The government previously announced guidance on umbrella companies in December 2023, which was deemed unhelpful by payroll employees.