Budget 2026: key points at a glance

John Healey has announced his first budget – here are the main points, with political analysis Healey offers £100 payment to households to help navigate ‘global economic storms’ UK growth forecast for 2027 slashed despite Healey’s budget measures Budget 2026 live – latest updates John Healey starts by saying that his budget is “delivered at a time when global uncertainties and pressures are swirling worldwide and hitting people here at home”. Healey says he will meet the fiscal rule that day-to-day spending must be covered by tax receipts, and the investment rule that government debt, defined as public sector net financial liabilities, must be falling as a percentage of GDP in the third year of the forecast. The government will have £15bn of headroom in 2029-30 and £20bn in 2030-31, according to the Office for Budget Responsibility, the government’s forecaster.

Government borrowing will be 4. 2% of GDP this year, 3. 4% next year, then 2. 9%, 2. 1% and 1. 8% by 2030-31, the OBR says. Predictions of slowing growth were wrong, Healey says. The OBR says GDP will grow by 1. 2% this year, 1% next year, 1. 6% in 2028, 1. 8% in 2029, 1. 7% in 2030 and 1. 6% in 2031. In March the OBR had predicted GDP growth of 1. 1% in 2026, rising to 1. 6% in 2027 and 2028, and dropping to 1. 5% in 2029 and 2030. Government debt is forecast to be 83. 2% of GDP this year, 83. 8% next year then falling to 83. 1%, 82. 3% and 81. 7% in the following years. Labour’s priority is cheaper energy, Healey says. He announces a series of measures to try to cut bills, including scrapping a levy on bills to fund hydrogen to lower bills and moving older renewables onto fixed-price contracts. Healey says the government will extend a VAT cut through the winter and spring to July, taking £50 pounds off the annual price cap. He…