1. Introduction


1.1 On 29 October, the Chancellor of the Exchequer delivered his 2018 Autumn Statement. This briefing provides an overview of the key announcements.


1.1 As expected, many of the announcements were at a high level but in some     cases, officers have been able to provide an early indication of the impact on RBKC. 


1.2 In line with previous announcements, officers are expecting further details to emerge over the coming days and weekswhich will enable us to further consider the impact on the Council, local businesses, schools and the wider community. Members will be updated accordingly. 


1.3 The Budget document is available on the Government’s website at this link:





Economic Indicators


2.1 The economy has performed more strongly than expected and as a result a number of one off funding plans were announced. 


2.2 The Government has reported that it remains on track tomeet three of its four fiscal objectives:


• Bringing the structural deficit below 2%. 

• Ensuring debt falls as a percentage of GDP.

• Keeping welfare spending below its cash limit.


2.3 Inflation – the OBR forecasts CPI inflation to be 2.6% in 2018 but will then fall again to around 2.0% for the rest of the forecast period.


2.4 Forecasts for borrowing are to be £11.6bn lower in 2018/19 than was previously forecast at the Spring Statement. That is equivalent to 1.2% of GDP.


2.5 Borrowing is forecast to increase to £31.8bn in 2019/20 before falling to £26.7bn in 2020/21 through to £19.8bn in 2023/24.


2.6 The Government is expecting to meet its fiscal targets three years early.




Key economic forecasts over the next five years are summarised in Table 1


Table 1 – Key Economic Indicators




3.1​There has been a slight downward trend in growth this year but this is expected to increase again in 2019. However, this assumption is based on a ‘relatively’ smooth exit from the EU and estimates could be very different if the UKs exit is more volatile. Chart 1 shows how current growth estimates compare to those made in previous budgets and Chancellor’s statements. 


Chart 1 – Growth Estimates



4.Announcements with potential impact upon Local Government


4.1 Although the date and the timetable of the 2019 Spending Review was not confirmed today, the overall level of public sector spending to 2023/24 was confirmed. 


4.2 For the next Spending Review period of five years there will be an average real terms increase in annual Resource Departmental Expenditure Limits (RDEL) of 1.2%, per annum. This compares to an average of minus 3.0% during the period of the Spending Review 2010 and minus 1.3% during the period of Spending Review 2015.





5.Social Care


5.1 The date of the Green Paper was not announced today but was confirmed to be released shortly. 


5.2 A further £240m was announced for 2019/20, which is on top of the £240m announced for 2018/19 last month. RBKCs estimated share is expected to be £0.9m but this has not been confirmed.


5.3 An additional £410m was announced for 2019/20 to be spent on children’s and adults social care. Although any conditions are not yet known it stipulates that Local Authorities should use the funding to ensure additional demand on the NHS is not created. RBKCs estimated share is expected to be £1.4m but this has not been confirmed.


5.4 An additional £55m of funding for the Disabilities Facilities Grant in 2018/19 to support adaptations in homes. RBKCs allocation is not yet known.


5.5 An additional £84m over 5 years for up to 20 local authorities, to help more children to stay at home safely with their families. It is not anticipated that RBKC will receive any of this funding but this has not been confirmed.


6.Business Rates


6.1 For two years, up until the next Revaluation in 2021, all retail premises with a rateable value below £51,000 will have their bills reduced by one third. This new relief is expected to cost £490m in 2019/20 and £450m in 2020/21. RBKC is expecting to be compensated for loss of income through a Section 31 grant.


6.2 A 100% mandatory relief will be introduced for public lavatories.


6.3 An additional £675m to support future high streets and town centres, including £55m for heritage based regeneration. The average is expected to be £25m per project and a prospectus containing eligibility and assessment criteria will be published later in the year.


7.Housing and Planning


7.1 The Housing Infrastructure Fund will increase by £500m, of which £291m will be used to provide 18,000 new homes by improving to the DLR. Although the DLR does not run through the borough it will develop the infrastructure in the Capital. 


7.2 £663m was announced to fund strategic partnerships for nine housing association. It is not yet clear if RBKC will benefit from this announcement. 


7.3 Community Infrastructure Levy – Government plans to simplify the system by removing restrictions on Section 106 funding. Officers will consider the implications of this announcement in further detail over the next few weeks.


7.4 New planning measures were announced to support high streets, including more flexibility for mixed use developments. A consultation is also planned to give additional freedoms to Local Authorities over the disposal of land. 


7.5 A register of empty properties will be trialled on selected Local Authorities.


7.6 An extension of the stamp duty relief for first time buyers to shared ownership and properties up to the value of £500k.


7.7 As previously announced, Government mentioned the removal of the HRA borrowing cap. Government is expecting Councils to build an additional 10,000 new homes. A new five-year strategic business plan for Homes England will be published.




8.1 The NHS was identified as a top priority and the budget will increase in real terms by 2023/24 by £20.5bn.


8.2 £250m of funding for mental health services was announced and a donation of £10m to support armed forces personnel with mental health needs. 


8.3 Government gave their commitments not to enter into any other PFI deals but also to establish a Centre for Excellence to manage existing projects. 


8.4 £10m of additional capital funding for the Air Ambulance was announced.




9.1 Universal credits – announced £1bn of funding for an additional package of measures to aid the transition to the new system over the next five years.


9.2 Over the next few weeks’ further work will be undertaken to understand the impact on people living in the borough.


9.3 The national Living Wage will increase from £7.83 to £8.21 from April 2019 an increase of 4.9%. In addition, Government announced support for the Low Pay Commission, for which further proposals will come forward as part of the Spending Review net year.




10.1 An additional £420m was announced for 2018/19 to tackle pot holes, repairs to damaged roads and maintaining bridges. In addition, £150m has been announced for small project improvements, such as roundabouts. It remains unclear what the RBKC allocation will be. 


10.2​The National Roads Fund will invest £25.3bn on projects, including the Lower Thames Crossing. 


10.3 The Transforming Cities Fund has been extended to 2022/23 and an extra £240m will be made available to the six metro mayors and a further £440m which will be allocated through a competitive process. Further details are awaited.


10.4 An announcement on Crossrail 2 is expected as part of next year’s Spending Review based on recommendations of the Independent Affordability Review. 


10.5 An additional £5m has been announced for the Westminster Ceremonial Streetscape Project which improves security and traffic flow.


11 Education and Skills


11.1​An additional £400m of capital funding was announced for this financial year for equipment and facilities in schools. This equates to approximately £10,000 for the average primary school and £50,000 for the average secondary school.

11.2 An additional £450m to support apprenticeships training and £140m to halve the levy for smaller employers.


11.3 An additional £28m of capital funding to support T Levels in 2020 across 52 providers.


11.4 An additional £100m for the National Retraining Scheme to provide new career guidance and work opportunities.


11.5 £200m will fund activities for 10 to 14 year olds working with those at risk of youth violence.


12 Brexit


12.1​An additional £500m was announced to assist Government Departments in preparing to leave the EU. Allocations for MCHLG are not yet known.


12.2 The next full fiscal update will be the Autumn Budget 2019 but Government confirmed that the Spring Statement next March can be upgraded to a full fiscal event if needed.


13 Grenfell


13.1 The budget did not include any announcement in relation to future funding of Grenfell recovery costs. The Council will continue to pursue discussions with Government.


Contact Officer​Taryn Eves


​​​​Tel: 0207 361 2271