Reward Strategy news and training

“The apprenticeship levy weighs on average earnings and consumption equally”

The apprenticeship levy and auto-enrolment of workplace pensions are estimated to reduce average earnings by 0.3 and 0.4 percent respectively by 2021, according to the Spring Statement.

TwitterLinkedIn
Chancellor Philip Hammond
Chancellor Philip Hammond

Chancellor Philip Hammond presented his first Spring Statement to Parliament on March 14.

 

The statement document reads: “Some of the weakness in our central forecast for earnings growth reflects judgements about the impact of government policies.

 

“We assume that the burden of these interventions is ultimately borne by workers, with wages lower than would otherwise be the case.”

 

The Chancellor said the most significant policies are the introduction of the apprenticeship levy and the continued rolling out of auto-enrolment into workplace pensions.

 

He said the above figures are based on the assumption that 80 percent of the additional cost to employers will be passed through to earnings.

 

He added: “As auto-enrolment boosts households’ pension savings in an offsetting way, we assume that the reduction in average earnings growth does not weigh on consumption growth. But we assume that the apprenticeship levy weighs on average earnings and consumption equally.”

TwitterLinkedIn
Add New Comment
LoginRegister

You might also like

IN OR OUT? Benefits and drawbacks of in-house and outsourced payroll

IN OR OUT? Benefits and drawbacks of in-house and outsourced payroll


UK firms to publish transparent pay ratios

UK firms to publish transparent pay ratios


Revealed: The Reward 300

Revealed: The Reward 300


The Pensions Regulator CEO Titcomb steps down

The Pensions Regulator CEO Titcomb steps down

The Autumn Update

LATEST PAYROLL AND REWARDS NEWS IN YOUR INBOX

Reward Strategy
Reward Strategy RSS

Did you find our website useful?

Thank you for your input

Thank you for your feedback

reward-strategy.com - an online news and information service for the UK’s payroll, reward, pensions, benefits and HR sectors. reward-strategy.com is published by Shard Financial Media Limited, registered in England & Wales as 5481132, Axe & Bottle Court, 70 Newcomen St, London, SE1 1YT. All rights reserved. Reward Strategy is committed to diversity in the workplace.
© Copyright Shard Financial Media Ltd