Finance Act 2001

an act to grant certain duties, to alter other duties, and to amend the law relating to the national debt and the public revenue, and to make further provision in connection with finance. most gracious sovereign, we, your majesty's most dutiful and loyal subjects, the commons of the united kingdom in parliament assembled, towards raising the necessary supplies to defray your majesty's public expenses, and making an addition to the public revenue, have freely and voluntarily resolved to give and grant unto your majesty the several duties hereinafter mentioned; and do therefore most humbly beseech your majesty that it may be enacted, and be it enacted by the queen's most excellent majesty, by and with the advice and consent of the lords spiritual and temporal, and commons, in this present parliament assembled, and by the authority of the same, as follows:[b]1. direct taxation[/b] [list](1)income tax shall be charged for the year 2001-02, and for that year[list] (a) the starting rate shall be 10%, (b) the basic rate shall be 23%, and (c) the higher rate shall be 40%. [/list] (2) for the year 2001-02 the amount specified in section 1(2)(aa) of the taxes act 1988 (the starting rate limit or personal allowance) shall be �4,500. (3) the national insurance contribution rate shall be 11.0% (4) the national insurance earnings threshold shall be �4,650 (5) corporation tax shall be charged for the financial year 2002 at the rate of 29%, and[list](a) the small companies rate shall be 19%, and (b) the starting rate shall be 10%[/list] (6) the capital gains tax shall be 10% (7) the iht rate shall be 40% (8) stamp duty shall be charged for the year 2001-02, and for that year[list](a) the lower rate shall be 1% (b) the normal rate shall be 3%, and (c) the higher rate shall be 4%[/list][/list] [b]2. indirect taxation[/b] [list](1) value added tax shall be 17.50% (2) fuel duties shall be charged for the year 2001-02, and for that year[list](a) the normal rate shall be 48.96 pence in the litre (b) the lower rate shall be 46.26 pence in the litre (c) the lower rate shall apply to petrol sold in rural areas

(d) for the purposes of this section, a rural area is an area designated as such by regulations made by the treasury; and any such regulations may[list](i) designate specified areas as rural areas, or (ii) provide for areas of a description specified in the regulations to be designated as rural areas.[/list][/list] (3) tobacco duty shall be �1.19 per pack of 10 cigarettes (4) road tax shall be[list](a) �165 per car, and (b) �1,500 per other vehicle[/list] (5) oil tax shall be 62% (6) duties on alcohol shall be charged[list](a) on wine, at �1.34 per 75cl (b) on spirits, at �7.15 per litre (c) on beer, at 31 pence in the pint[/list] (7) air passenger duty shall be �7.20 (8) general betting duty shall be 6.75% (9) insurance premium tax shall be 5% (10) the landfill tax, climate change levy, and customs duty shall be charged for the year 2001-02[/list] [b]3. other income[/b] [list](1) hm treasury shall project the receipt of [list](a)�17,020,000,000 in other receipts (b) �160,000,000 in military contracts[/list] (2) for the revenues of the national lottery in the year 2001-02[list](a) 50% shall be returned as prizes (b) 28% shall be returned to good causes (c) 10.5% shall be collected as lottery duty (d) 5% shall be returned to retailers as commission (e) 6.5% shall be returned to the contractor[/list][/list] [b]4. home office[/b] [list](1) the hiring is authorized of[list](a) 3,000 street bobbies, (b) 1,500 plainclothes detectives, (c) 1,000 other police (d) 400 fire personnel, and (e) 160 other staff[/list] (2) all salaries are to rise by 4.81%

(3) for the year 2001-02[list](a) �2,420,000,000 is to be spent on structures and equipment, (b) �1,020,000,000 is to be spent on educational programs, (c) �4,820,000,000 is to be spent on personnel (d) �5,790,000,000 is to be spent on administration and other costs, and (e) �720,000,000 is to be spent on other programmes; [list](i) this shall include the establishment of a police equipment modernisation fund at �90,000,000[/list][/list] [/list] [b]5. hm prisons[/b] [list](1) the hiring is authorized of[list](a) 1,500 general prison officers, and (b) 200 psychologists[/list] (2) a total of �3,418,000,000 is allotted to hm prisons[/list] [b]6. defence[/b] [list](1) all salaries shall rise by 2.81% (2) �8,093,000,000 is to be spent on personnel (3) �2,230,000,000 is to be spent on training (4) �12,550,000,000 is to be spent on operating costs[/list] [b]7. transport[/b] [list](1) �1,662,000,000 is to be spent on air travel (2) �3,021,000,000 shall be budgeted for rail travel (3) �1,380,000,000 shall be budgeted for highways and roads, including[list](a) �370,000,000 for the construction of new highways[/list] (4) �2,030,000 shall be budgeted for administration and other costs (5) all salaries shall rise by 2.81%[/list] [b]8. regions[/b] [list](1) the treasury shall transfer money to the regions, namely[list](a)�8,110,000,000 for wales, (b)�16,060,000,000 for scotland, and (c)�5,730,000,000 for northern ireland[/list][/list] [b]9. health[/b] [list](1) �6,070,000,000 shall be budgeted for hospital maintenance (2) the hiring is authorized of-

[list](a) 4,700 new medical practitioners, (b) 18,280 new nurses, (c) 4,570 new social services staff, (d) 2,285 new support and ancilliary staff, and (e) 350 new civil service staff[/list] (3) all salaries, with the exception of nurses, shall rise by 4.81% (4) nurses' salaries shall rise by 8% (5) a total of �18,660,000,000 shall be budgeted for personnel (6) �11,610,000,000 shall be budgeted for other policies/costs (7) prescription charges shall be �6.35 (8) the total of �6,050,000,000 is budgeted in years 2002-03, 2003-04, and 200405, for the construction of[list](a) 2 major hospitals, and (b) 6 large hospitals[/list][/list] [b]10. culture and sport[/b] [list](1) public sector investment in sport shall be �330,000,000 (2) hm government shall contribute �100 per fee for government sponsored activities (3) public sector investment in amateur athletes shall be �150,000,000 (4) museum entrance fees shall be �1.44 (5) �780,000,000 shall be allocated to museums[/list] [b]11. social security[/b] [list](1) employment and income support benefits shall be paid as follows for the year 2001-02[list](a) �565.46 for crisis loans (b) �3,220.00 for unemployment (c) �1,151.47 for housing benefit (d) �1,459.90 for income supplement (e) �1,562.71 for wage subsidies (f) �650.00 for student maintenance loans[/list] (2) there is established under employment and income support a fuel tax rebate, which[list](a) shall refund a portion of fuel tax paid by commercial drivers, (b) shall, for the year 2001-02, refund 7% of the above tax, and (c) shall, for the year 2002-03, refund 10% of the above tax[/list] (3) health and death benefits shall be paid as follows for the year 2001-02[list](a) �900.00 for bereavement allowance (b) �600.00 for bereavement payment

(c) (d) (e) (f) (g)

�1,200.00 �1,200.00 �2,750.00 �2,750.00 �1,900.00

for for for for for

attendance allowance disability living allowance incapacity benefit severe disablement allowance statutory sick pay[/list]

(4) family and children benefits shall be paid as follows for the year 2001-02[list](a) �1,180.00 for child benefit (b) �490.00 for free school meals (c) �1,135.00 for maternity allowance (d) �901.00 for statutory adoption pay (e) �909.32 for guardian's allowance[/list] (5) the working family tax credit shall be paid[list](a) for the year 2001-02, at �4,116.51 (b) for the year 2002-03, at �4,116.51 plus the rate of inflation for fiscal 200102 (c) for the year 2003-04, at the 2002-03 rate plus the rate of inflation for 200203 (d) for the year 2004-05, at the 2003-04 rate plus the rate of inflation for 200304[/list] (6) the basic state pension shall be paid[list](a) for the year 2001-02, at �4,811.51 (b) for the year 2002-03, at �4,811.51 plus the rate of inflation for fiscal 200102 (c) for the year 2003-04, at the 2002-03 rate plus the rate of inflation for 200203 (d) for the year 2004-05, at the 2003-04 rate plus the rate of inflation for 200304[/list] (7) the war pension shall be paid[list](a) for the year 2001-02, at ��5,474.63 (b) for the year 2002-03, at ��5,474.63 plus the rate of inflation for fiscal 2001-02 (c) for the year 2003-04, at the 2002-03 rate plus the rate of inflation for 200203 (d) for the year 2004-05, at the 2003-04 rate plus the rate of inflation for 200304[/list] (8) all salaries shall rise by 2.81% (9) �2,220,000,000 is budgeted for personnel[/list] [b]12. tdi, energy, employment[/b] [list](1) �2,080,000,000 is budgeted for industry (2) �1,816,000 is budgeted for trade (3) all salaries shall rise by 2.81% (4) �552,000,000 is budgeted for personnel

(5) �1,314,000,000 is budgeted for employment[/list] [b]13. environment[/b] [list](1) all salaries shall rise by 2.81% (2) �372,000,000 is budgeted for personnel (3) �31,590,000,000 is budgeted for grants to local government (4) �1,445,000,000 is budgeted for administrative/other costs, including[list](a) �20,000,000 for a new fund for money to regional development agencies for local environment plans[/list][/list] [b]14. education[/b] [list](1) all salaries shall rise by 2.81% (2) �1,760,000,000.00 shall be budgeted for nurseries (3) �8,670,000,000.00 shall be budgeted for primary schools (4) �5,590,000,000.00 shall be budgeted for secondary schools (5) �170,000,000.00 shall be budgeted for independent/special schools (6) �5,680,000,000.00 shall be budgeted for universities / public grants, including[list](a) a 2% rise in all grants per student[/list] (7) �2,700,000,000.00 shall be budgeted for adult education initiatives (8) �440,000,000.00 shall be budgeted for various public grants[/list] [b]15. other spending[/b] [list](1) �1,000,000,000.00 shall be budgeted for the cabinet office (2) �3,120,000,000.00 shall be budgeted for the chancellor's departments* (3) �2,000,000,000.00 shall be budgeted for the lord chancellor's departments (4) �4,860,000,000.00 shall be budgeted for the department of housing and regeneration (5) �980,000,000.00 shall be budgeted for the ministry of agriculture, fisheries and food (6) �1,020,000,000.00 shall be budgeted for the foreign and commonwealth office (7) �2,850,000,000.00 shall be budgeted for the ministry of international development (8) �800,000,000.00 shall be budgeted for other public services (9) �700,000,000.00 shall be budgeted for common services

(10) �2,900,000,000.00 shall be budgeted for other colonies (11) �120,000,000.00 shall be budgeted for the new deal for communities (12) �140,000,000.00 shall be budgeted for sure start (13) �870,000,000.00 shall be budgeted for the employment opportunities fund (14) �3,440,000,000.00 shall be budgeted for the criminal justice system supplementary fund (15) �140,000,000.00 shall be budgeted for crime�reduction programmes (16) �680,000,000.00 shall be budgeted for illegal drugs programmes (17) �2,820,000,000.00 shall be budgeted for science research (18) �520,000,000.00 shall be budgeted for conflict prevention funds (19) �5,000,000.00 shall be budgeted for disaster relief (20) �260,000,000.00 shall be budgeted for teachers' supplementary funds (21) �4,220,000,000 shall be paid to the eec (22) �1,400,000,000 shall be paid to the contingency fund (23) �20,420,000,000 shall be paid in debt interest[/list] [b]16. national debt[/b] [list](1) hm treasury is authorized to direct the annual surplus of �820,000,000 towards the repayment of the same amount of national debt[/list] [b]17. short title and enactment[/b] [list](1) this act may be cited as the finance act 2001 (2) this act comes into force on the 6th april 2001[/list]