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Treasury minister delivers 2023 Budget

The Island's Treasury Minister has unveiled this year's budget in Tynwald today.

Dr Alex Allinson says the 'robust five-year financial plan' will commit more than £230m to 'reinforce strong financial foundations' following 'two years of economic turbulence.'

It sees government revenue spending for 2023/24 budgeted at £1.2 billion, representing £15,243 for every person on Island.

Tynwald members will vote on it later today.

In terms of departmental budgets, Health and Social Care will receive an overall increase of £20.5m, Education, Sport and Culture £11.52m, Infrastructure £4.66m, Home Affairs £2.16m and Environment, Food and Agriculture £2.03m.

Meanwhile, tax rates remain largely unaffected, with the personal income allowance staying at £14,500 for individuals and £29,000 for jointly assessed couples, and the 10% band fixed at £6,500.

A change has, however, been introduced for higher earners whose personal allowance will be reduced by £1 for every £2 above an income of £100,000.

The Treasury Minister said: 'In essence this means that a person with a total income of £129,000 or over, or £258,000 or over in the case of a jointly assessed couple, will have their personal allowance reduced to zero. This progressive measure means that those who have more, pay more.'

Addressing the needs of business, Minister Allinson confirmed the National Insurance Holiday Scheme will continue for another year with further improvements.

Meanwhile, some welfare benefits are going up - maternity, paternity and adoption allowances will increase by 16.8%, while the basic state pension and Manx state pension will see an uplift of 10.1%. 

Elsewhere, Income support, child benefit, Employed Person's Allowance and income-based Jobseeker's Allowance will rise by 9.8% and carer's allowance by 10.7%. 

The Treasury Minister said: 'Recognising the valuable role that carers play in our community, and to provide additional support to those who may have given up or refrained from work in order to look after another person, I have decided to increase the rate of carer's allowance by a further £15 a week. This builds on the 15 per cent increase provided last year. This will result in additional spend on this benefit of just under half a million pounds a year, assisting almost 600 carers.'

Addressing members, Mr Allinson also highligted ambitions to further develop the Island's infrastructure and services - alligning with plans to grow the local population to 100,000 in the next 15 years.

In line with this, a £100m Economic Strategy Fund will be established in the 2023-24 financial year. 

The Minister added to 'balance the accounts', the five-year plan relies on transfers from general reserves to bridge the gap between income and expenditure.

The Treasury Minister told Members: 'To fully fund this investment we will, once again, need to draw down heavily on reserves to bridge the gap between income and expenditure '

The Budget shows an initial annual structural deficit of £152 million which Dr Allinson says will gradually reduce over the following four years.

Speaking to Dr Allinson, he highlights how the aim of the Budget is to provide 'stability':

 

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