Budget 2002 roundup

A number of Budget announcements had implications for benefits packages.

  • The pensions cap will rise from ¬£95,400 to ¬£97,200 for the 2002/03 tax year, helping high earners save more for retirement.
  • Family-friendly policies may need to be improved after the child tax credit was introduced to help parents afford to stay at home with their children. The tapered payment of up to ¬£27.75 a week for families earning up to ¬£58,000 will mean employers have to work harder to get parents back to work.
  • Capital gains tax (CGT) taper relief on shares owned by employees through Inland Revenue-approved share plans has changed. The tax employees pay when they sell their shares will now reduce from 40% to 10%, over two years – instead of four years.
  • Brown reminded voters of the increase in statutory maternity pay for 2002/03 to ¬£75 a week, and to ¬£100 a week or 90% of earnings in 2002/03. He restated that maternity leave will be extended to 26 weeks next year.
  • Training was boosted by the announcement of a pilot scheme offering financial support for employers giving staff time off to train. This is part of a ¬£30m investment to aid SMEs to reach the Investors in People standard.