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News articles

October 20, 2010

How will the spending review affect your employees?

For your employees the announcements about pensions are likely to cause the biggest concern, with the state pension age for men to start rising from 65 in 2018, six years earlier than planned, to 66 by 2020.

The rise for women will also reach 66 by 2020. The government hopes this will save £5bn a year with these measures.

 

It is also expected that the reform of public sector pensions will see your employees likely to contribute more.

 

A new 12-month time limit on the employment and support allowance is likely to mean around 200,000 people moved to jobseekers allowance, and many more people encouraged to look for work.

 

What else is happening…?

  • There is an increased working hours threshold for working tax credits for couples with children.
  • Current spending on business, innovation and skills cuts by 25%; with capital spending down 52%.
  • The government will also cut 24 quangos, and cut the Train to Gain programme.
  • Funding for 75,000 adult apprenticeships a year will be made available.
  • The health sector will see a small rise of 0.4% over four years in its budget
  • The government is still seeking £20bn in efficiency and productivity savings in the NHS.
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