In first budget, UK's Healey tries to shelter households from economic storms
SPY•UK finance minister John Healey announced household energy support and another fuel-duty freeze in his first budget, while raising taxes on banks, gambling, savers and landlords. The budget watchdog cut its 2027 growth forecast to 1.0% and said the government's fiscal buffer had shrunk to £15 billion.
1. Household support
The budget includes a £100 payment for about 20 million households in lower-valued homes to ease rising energy bills, at a cost of £2.6 billion. Healey also extended the freeze on fuel-duty rates until at least July, costing £1.4 billion over the period, and said standing charges on gas bills would be removed for most households.
2. Growth and borrowing
The Office for Budget Responsibility said the measures, alongside higher inflation and borrowing costs, would add £65 billion to borrowing over five years. It forecast GDP growth of 1.2% in 2026 and 1.0% in 2027, and said Healey's fiscal buffer had fallen to £15 billion from a previous estimate of £24 billion.
3. Taxes and investment
Healey said taxes would rise on banks, gambling, savers and landlords, and VAT rules would be tightened for online marketplaces. More than £20 billion in additional support will go to state finance institutions to encourage investment in artificial intelligence, defence and green energy by the early 2030s.
