Isle of Man Budget Update at a glance
- A £100m Economic Recovery Fund will be created to bolster businesses, promote innovation, create training and employment opportunities, and invest in the domestic economy.
- The Council of Ministers has commissioned a series of projects to stimulate the internal economy, create and protect employment, and provide investment in the Island.
- Research will be undertaken into how the Island can seize on opportunities presented by the crisis and, looking ahead, be well-placed as the global economy settles over the coming months.
- £17.5m will be withdrawn from the contingency fund - topping up the £40m transferred earlier in the year - to cover the projected cost of coronavirus support packages as well as the forecast shortfall in departmental budgets set in February.
- The Salary Support Scheme and the Coronavirus Business Support Scheme have been extended for certain sectors through to September, providing further direct support to those involved in travel, tourism, and fisheries. A £10m Working Capital Loan scheme will also be available to enable businesses to resume activity.
- A £250m revolving credit facility will be set up over two years to establish an alternative source of liquidity, if required, to meet future financial challenges as they arise.
- A review of the capital programme has been undertaken, with increased focus on an acceleration of schemes that support the economy and local employment market.
- To date, the Salary Support Scheme has supported 12,295 jobs and 1,999 businesses and paid out £27.5m; the Strategic Capacity Scheme has paid out £2.5m to 182 hotels and tourist accommodation providers; the Business Support Scheme has paid out £9.2M to 3,061 businesses; the Disruption Loan Scheme has backed £1.8m of loans for 37 applications, protecting 275 jobs.
- Between 1 March and 13 July the Manx Earnings Replacement Allowance paid out £3.4m, Income Support £8.3m, Job Seeker’s Allowance £2.2m and Incapacity benefit £1m.
- MERA will not be available to the newly unemployed from 1 August 2020 and the rate is to be reduced to £100 per week from 3 August 2020. The amount a person can earn and retain MERA has increased to £150 per week.
- More than £30m of Government taxation payments have been deferred.
- Economic surveys have recently drawn feedback from 400 businesses and 500 households.
- The number of people registered unemployed was 400 in March, rising to 1,350 by the beginning of May. There are currently around 1,100 people registered as unemployed and claiming Jobseeker’s Allowance.
Isle of Man Budget at a glance
Key features of the 2020-21 Isle of Man Budget include:
- An increase for the fourth consecutive year to the personal income tax allowance, of £250 to £14,250, leading to around 465 people being lifted out of the tax net.
- A rise in the National Insurance Earning Threshold to £138 will benefit 41,000 people. This has been offset by a 5% (£39) rise in the Upper Earnings Limit that will see up to 3,500 paying more National Insurance contributions.
- A 2% targeted rise will improve the circumstances of 7,000 families who receive child benefit and 4,000 people in receipt of disability living allowance and attendance allowance
- Around 400 people who live in nursing homes will see the rate of their nursing care contribution increase by 3.6%, and 1,000 pensioners and 300 people with disabilities who get income support will benefit from a 5.2% increase in their pensioner and disability premiums
- A 3.9% rise in the Basic/Manx State Pension, increasing weekly amounts by up to
- £7 for a single pensioner and up to £15 for a pensioner couple.
Other key points from the 2020-21 Budget:
- A capital programme set at £159 million will focus spending on a range of schemes aimed at delivering a lasting legacy for the people of the Isle of Man. More than £540 million is scheduled to be invested over the next five years, demonstrating confidence in the Manx economy and providing a platform for growth.
- In addition to the £5 million revenue-funded Environmental Protection Fund, the £5 million capital-funded Climate Change Mitigation Initiatives Fund will empower Departments to initiate innovative measures that support the actions and objectives of the independent Climate Change report compiled by Professor James Curran. A further £6.4 million will be channelled into the rolling 25-year programme of climate change adaption designed to deal with the effects of rising sea levels.
- An additional £2.2 million for Health and Social Care services, £5 million for Infrastructure, £2.3 million for Department for Enterprise and £700,000 for Education, Sport & Culture relating primarily to Apprenticeships.
- £326,000 for the Office of Cyber Security & Information Assurance to focus on developing our defences against new and emerging technology and cyber threats.
- £590,000 to fund a new and improved Air Ambulance service and £565,000 to fund an increase in the Endoscopy service available to patients on the Island.
- More than £1 million of capital funding towards new communications equipment for the emergency services.
- Healthcare Transformation Fund to be topped up by £5m to support Sir Jonathan Michael’s Health Care recommendations
- Reflecting the Island’s UNESCO Biosphere status, a new nature reserve will be created on a former landfill site at the Point of Ayre at a cost of £80,000 in a joint project with Manx Birdlife. The Island’s national glens and footpaths will also receive further investment in paths, play areas and car parks.
Further information from:
Caldric Randall, Chief Financial Officer
Isle of Man
+44 1624 686433
+44 1624 685662