The spring statement was delivered by chancellor Rachel Reeves today – but what does it all mean and how has the dental profession reacted?
Today, the chancellor laid out her plans for the UK economy in the House of Commons, focusing largely on welfare changes and public services.
It came as the Office for Budget Responsibility (OBR) announced its latest economic forecasts. These include:
- It lowered its predicted growth for 2024 from 2% to 1%
- Inflation expected to rise to 3.2% this year and hit 2% government target from 2027
- The OBR says the government’s changes to the planning system in England will boost the size of the economy by 0.2% by 2030.
Iain Stevenson, head of dental at Wesleyan Financial Services, said: ‘Today’s spring statement was short on good news for dentists.
‘Many practices will still be absorbing the measures announced in the autumn budget, including hikes to employers’ national insurance and the national living wage. These measures begin next month and will heap extra pressure on practices’ finances. While there is some relief that no new employer taxes were announced, nothing was introduced to ease the burden either.
‘From a personal finance perspective, we heard nothing further on inheritance tax (IHT) – an issue already worrying dental professionals, given plans to bring pensions into its scope from 2027.
‘We don’t yet know if it will affect NHS pension scheme funds, but it will certainly include private pension savings, which many dentists have. As we await more information, it’s important to start considering what this might mean for both your retirement and estate plans, and to seek expert advice if needed.
‘IHT rules are complex, and a professional adviser can help create a sound plan that delivers the best outcomes for you.’
‘Urgent need’ for investment
Tom Reynolds, director of policy and communications at the Medical Defence Union (MDU), said: ‘The spring statement lays bare the significant financial challenges facing the public purse.
‘While the government’s focus is on efficiency, there is an urgent need to invest in frontline NHS health and social care services. That is why the government must not shy away from bold reforms which could allow for the most efficient use of existing budgets.
‘The MDU is acutely aware of the strains on the NHS’s finances. It has long campaigned for reform of the law surrounding clinical negligence costs which could free up hundreds of millions of pounds every year to be spent on recruiting staff, improving working conditions and patient care and tackling waiting lists.
‘We are calling for urgent action by the government to reform the disproportionate legal costs awarded in lower value clinical negligence claims as we regularly see legal costs eclipse the amount of compensation awarded to a patient. There needs to be a prompt introduction of fixed recoverable costs in clinical negligence claims of up to £25,000, followed by a commitment to extend that regime to claims valued up to £250,000.
‘There is a vital need to repeal S2(4) of the Law Reform (Personal Injuries) Act 1948, requiring the courts to disregard the existence of the NHS when making a compensation award, and instead doing so on the basis of the cost of private care.
‘These are just some of many reforms the system is crying out for. By addressing these unsustainable costs, the government will be able to redirect much needed funds to frontline NHS services. It is time to get on and do it.’
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