UK's Healey offers help to households hit by global economic storms
TLT•British finance minister John Healey announced household energy and fuel-cost support in a budget that raises taxes on banks, gambling, savers and landlords. The budget watchdog forecast GDP growth of 1.2% in 2026 and 1.0% in 2027, and said the fiscal buffer had shrunk to £15 billion.
1. Household support and tax rises
Healey announced a £100 payment for around 20 million households in lower-valued homes to soften rising energy bills, at a cost of £2.6 billion. He extended a five-pence-per-litre fuel duty cut until at least July, costing £1.4 billion over the period, and said taxes would rise on banks, gambling, savers and landlords.
2. Growth and borrowing outlook
The Office for Budget Responsibility forecast GDP growth of 1.2% in 2026, slightly above its previous 1.1% forecast, and cut its 2027 forecast to 1.0% from 1.6%. It said budget plans, higher inflation and borrowing costs would add £65 billion to borrowing over five years compared with its prior forecasts. The OBR also warned that living standards would fall in the near term.
3. Smaller fiscal buffer
Healey said the buffer for meeting his main fiscal target had fallen to £15 billion from £24 billion, but said he would meet his commitments to repair public finances. British 30-year government bond yields fell during his speech and were down as much as five basis points at 5.691%.
