Chancellor Rachel Reeves delivered the first Labour budget in 15 years. Image credit: Shutterstock.
On 30 November, Chancellor Rachel Reeves delivered the first Labour budget in 15 years, which raised some taxes, notably national insurance contributions for employers, in order to invest in the NHS, education and infrastructure.
How will the budget impact the creative industries?
Announcements most likely to directly impact the creative industries, music and musicians include:
- Creative careers: £3 million to expand the Creative Careers Programme, giving school children the opportunity to learn more about career routes and directly engage with the workplace.
- Funding for culture sector: A 2.6% increase in funding for the Department for Culture, Media and Sport.
- Grassroots music venues and hospitality businesses: A permanent lowering of business rates for retail, hospitality and leisure businesses from 2026-27. Until then they will receive 40% relief on business rates up to a cap of £110,000. This is a reduction in the relief they have been receiving which could be a burden for grassroots music venues and other hospitality businesses employing our members.
- Venues selling alcohol: Alcohol duty on draught drinks will be cut so that an average ABV strength pint will pay 1p less in duty, benefitting venues selling alcohol.
- Fuel duty freeze:The fuel duty freeze has been extended for a year, maintaining the last government’s 5p cut.
- VAT on private schools: VAT will be brought in on private school fees from January 2025, which we broadly support although we will be keeping a close eye on any impact on our members who teach in those schools.
- Theatres and other venues: £1 billion has been earmarked to address RAAC, which will be good news for some of the theatres and other venues that are still closed.
- Local councils: There will also be a real terms increase in total core spending power for Local Authorities of around 3.2%.
An increase in core school funding
The Chancellor also committed to £6.7 billion for education investment next year.
Given the manifesto promises on a broader curriculum and access to music and the arts for all young people, we will continue to lobby for as much of this money as possible to go towards music education.
The budget introduces some positive measures for working people
Against a difficult financial backdrop, the Chancellor also announced some positive measures for working people:
- National Living Wage: The National Living Wage will rise by 6.7% to £12.21. For those aged 18 to 20 it will go from £8.60 to £10 an hour, a rise of more than 16% and the largest increase on record.
- Carer's Allowance: There will be an increase in the weekly earnings limit to the equivalent of 16 hours at the National Living Wage, meaning a carer can now earn over £10,000 a year while earning carers' allowance.
Commitments to green energy
There were a number of commitments to green energy including:
- GB Energy: £25m to establish GB Energy and £100m as a first step for GB Energy to develop new clean energy projects.
- North of England: £3.9bn of funding in 2025-2026 for Carbon Capture, Usage and Storage Track 1 projects in the North.
- Green hydrogen: Green hydrogen projects across England, Scotland and Wales, in Bridgend, East Renfrewshire and Barrow and Furness.
- Devolution payments: There will also be devolution payments of £3.4bn more for Scotland, £1.7bn more for Wales and £1.5bn more for Northern Ireland.
We will be working to ensure Labour’s commitments to arts education and EU touring are delivered
MU General Secretary Naomi Pohl said:
“'This is Labour's first budget and it focuses primarily on raising money through an employer's national insurance rise, ending non-dom tax status, introducing VAT on private school fees and other measures that will enable a significant increase in public spending.
“The NHS and schools are the big focus and therefore there was no specific reference to the arts or music, which will be disappointing for our members. However, there are measures that will be helpful such as an increase in devolved funding for local authorities and governments in Scotland, Wales and NI.
“Labour has made many commitments from broadening the curriculum and reprioritising arts subjects in schools to fixing EU touring. As an affiliated union, we will be working with the cabinet and ministers to ensure these are delivered and more.
“We argue that there is some wealth redistribution possible within the music industry and big tech, for example introducing a statutory grassroots music levy, improving streaming royalties and ensuring remuneration is provided for human creators from AI-generated music.”