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After the debacle of Liz Truss’s September mini-budget, with all its mega ramifications, and an autumn statement eight weeks later that performed an about-turn so big that the country’s tax burden hit a 70-year-high, Wednesday’s budget will be all about stability and sticking to the plan.

“No big bangs in this budget,” is how one senior government insider put it to me last week. “It’s got to be a growth budget.

“We’re fighting to be competitive again with Labour. If we can get to next summer and the economy is ticking up, and we can narrow the gap to five to eight points behind in the polls, there’s a chance in an election campaign we can shift the dial.”

Tax cuts, I’m told, will have to wait.

Politics live: Date confirmed for Johnson to face partygate inquiry

What the chancellor and prime minister want to project this week is the sense that they are getting the economy back on track, and working towards Rishi Sunak’s pledges to halve inflation, get debt down and get the UK economy growing again.

Do that, argue his allies, and the tax cuts will come – just in time for a general election.

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But there is pressure, and lots of it, from voters and from the Tory backbenchers to do more on tax cuts and cost-of-living now, not tomorrow.

And that pressure is all the more palpable after the chancellor received a £30bn windfall in the public finances last month, after it emerged that in the year to January, the public sector had borrowed less than forecast in November by the UK’s official fiscal watchdog.

Budget promo tomorrow

Floating voters we spoke to in a focus group in one Tory shire seat last week told us that struggling with the cost-of-living and a buckling NHS were top of their concerns, and they expressed scepticism that the government was up to the job.

One voter in the Wycombe constituency in Buckinghamshire described the government as “stale”, with another telling us: “The current crisis emphasises that our government is fairly broken.”

On the cost-of-living, our group of floating voters spoke of their anxiety around energy bills, food prices and childcare.

Charlotte, a working mum, told us she had to change her working hours because she couldn’t afford childcare costs.

“I can’t afford to work full time anymore,” she told us. “It’s not feasible for our family, so I’ve had to rope my mum in to do childcare.

“I wouldn’t say we’re a low earning family. That’s just the way it is now.”

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Voters talk about their priorities with our political editor Beth Rigby.

Food bills were also a concern, with voters saying they’d switched to cheaper supermarkets and cut back in the face of galloping food price inflation.

Ashley, who in the past has voted Conservative but is now undecided, told us he’d switched his weekly shop from Tesco and M&S to Aldi, while energy bills were a problem all round.

“I’ve voted Conservative a long time,” the father-of-two told us. “And then I got a bit tired of, you know, Boris and the promises.

“We need to have some results and I want to see some improvement, not the deflection bit around immigration, [but] some real positive on the cost of living. For me, that’s the most key…it’s what’s important to people.”

Short and long term plans

The Treasury is alive to the pressure, with insiders telling me there will be two parts to Mr Hunt’s budget on Wednesday: a short-term support plan to provide immediate relief on the cost-of-living crisis and then the long-term plan for growth.

On the first part of that, the government is expected to extend the £2,500 energy price guarantee for another three months from April (where there had been a planned rise to £3,000) to give people support on their bills.

The chancellor is also under pressure to again freeze fuel taxes in this budget, at a cost of £6bn.

When it comes to childcare, the chancellor is expected to change rules so that parents on Universal Credit are given more money for childcare and given the funding upfront.

The Treasury is also believed to be planning a cash injection of hundreds of millions into increasing the availability of the 30 hours of free childcare to three to four-year-olds.

Mr Hunt also plans to loosen staff-to-child ratios for two-year-olds, which could make the cost of childcare a little cheaper.

But anything really big bang on childcare, such as extending 30 hours of free childcare to one-and two-year-olds, is unlikely – that policy would cost around £6bn.

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These are some predictions for the budget.

And when it comes to the most obvious way of helping people manage their bills – wage packets – the government is standing firm, with Treasury insiders insisting there will be no above inflation pay sector awards.

Neither is the chancellor expected to offer voters any cuts to personal taxes.

“We haven’t got £30bn to cut taxes,” is how one government insider put it to me, in a nod to the boost from revised public finances.

“What we’ve got to do is get people back into work, be that through better childcare support or incentives to get those in their 50s back into work.

“That is where we have to focus policy, and that could amount to say £5bn and that comes out of the [£30bn] headroom.”

Because beyond the short-term support measures, the focus for this budget will be on trying to get the economy moving and getting people back to work post-pandemic, with a package of measures to try to shift parents, the sick, disabled and older workers back into jobs.

To that end, the chancellor is expected to raise the lifetime allowance for pension savings from £1m to an expected £1.8m – a record level – in order to try to incentivise doctors and other professionals out of retirement and back into work.

He could also lift the annual tax-free allowance for pensions from £40,000 to £60,000.

It’s a package that could cost £2bn a year and would be much welcomed by higher earners, but also opens the chancellor up to criticism that he is giving a tax break to the rich while offering nothing to basic rate taxpayers.

Read more:
What to look out for in Hunt’s first budget

And when it comes to the other group of voters the chancellor and PM need to placate, his backbenchers, there is disquiet over the high level of tax burden, with many Tory MPs keen for tax cuts.

One former cabinet minister told me last week that they wanted to see the £30bn windfall in the public finances used to reverse the planned increase in corporation tax from 19p to 25p in April.

It is a pretty popular refrain.

But Treasury insiders insist the tax hike will go ahead and instead the chancellor will offer business tax breaks to try to encourage growth.

When Mr Sunak was chancellor back in March 2021, he created the £25bn “super-deduction” tax allowance for capital investment – a two-year measure offering 130% tax relief on companies’ purchases of equipment – in order to try to boost investment and growth.

Mr Hunt is coming up with a new set of plans to try to support business and could give firms much more generous capital allowances to incentivise investment.

Watch too for policies and reforms targeting certain industries and sectors, from artificial intelligence to green energy and advanced manufacturing: all of it will be framed as the government’s long-term plan for growth.

 Prime Minister Rishi Sunak (left) and Chancellor of the Exchequer Jeremy Hunt during Prime Minister's Questions in the House of Commons
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Rishi Sunak and Jeremy Hunt will be hoping to reassure people they are making the right choices for the UK economy.

Wednesday will be, if you like, the third act of the prime minister’s performance over the past few weeks to try and win a jaded public back around by trying to convince them he will stick to his plan and deliver on promises.

On the international stage, he has rehabilitated the UK with allies after the bumpy years of Prime Minister Johnson and then Prime Minister Truss, symbolised most strongly in a deal with the EU over post-Brexit trading arrangements in Northern Ireland – where even his foes conceded Mr Sunak had got more than they expected.

At home, the PM has put forward his plan to “stop the boats” – a key priority of many of the voters he needs to keep onside or win back in 2024.

Whether the plan, surrounded in legal and practical controversies, will come off remains to be seen.

But Mr Sunak will at least be able, to quote one of his allies, “build a narrative” that blames the failure of the policy around France and the EU refusing to grant the UK a returns agreement and the international courts blocking his plans.

“At least he can then make the argument it wasn’t his fault,” they said.

Narrow path back

On Wednesday, the focus will be on the PM’s three economic targets – halving inflation, cutting debt and growing the economy – as the chancellor tries to lay down the best conditions he can for the Conservatives’ run into the general election in 2024.

Mr Sunak’s allies tell me they think there is a way back to victory for this government at the ballot box once again, but the “path is very narrow”.

A budget then building the foundations rather than lighting the fireworks, all of this the groundwork for the pre-election showstopper next year.

But with the cost-of-living squeeze so acute, the promise of jam tomorrow is unlikely to satisfy the public, particularly if those being given some of the spoils this time around look to be business and the wealthy.

Mr Hunt may be charged with steadying the ship, but he’ll have to be skilful on Wednesday not to lose more ground.

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Israel allows foreign countries to parachute aid into Gaza

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Israel allows foreign countries to parachute aid into Gaza

Israel has said foreign countries can drop aid into Gaza from today.

A senior IDF official told Sky News on Friday: “Starting today, Israel will allow foreign countries to parachute aid into Gaza.

“Starting this afternoon, the WCK organisation began reactivating its kitchens.”

Humanitarian aid organisation World Central Kitchen paused its operation in Gaza in November after a number of its workers were killed in an Israeli airstrike last year.

Aid workers in Gaza – who help provide food, medicine and shelter for the millions displaced there – have been affected by the ongoing conflict between Israel and Hamas.

In recent weeks hundreds of Palestinians have been killed while waiting for food and aid.

This breaking news story is being updated and more details will be published shortly.

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‘Almost like a game of target practice’: British surgeon says IDF shooting Gazans at aid points

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'Almost like a game of target practice': British surgeon says IDF shooting Gazans at aid points

A British surgeon who recently returned from Gaza has told Sky News that there is “profound malnutrition” among the population – and claims IDF soldiers are shooting civilians at aid points “like a game of target practice”.

Dr Nick Maynard spent four weeks working inside Nasser Hospital, where a lack of food has left medics struggling to treat children and toddlers.

The conditions inside the hospital, in the south of the Strip, have been documented in a Sky News report.

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Malnourished girl: ‘The war changed me’

Dr Maynard told The World with Yalda Hakim: “I met several doctors who had cartons of formula feed in their luggage – and they were all confiscated by the Israeli border guards. Nothing else got confiscated, just the formula feed.

“There were four premature babies who died during the first two weeks when I was in Nasser Hospital – and there will be many, many more deaths until the Israelis allow proper food to get in there.”

Palestinians wait to receive food from a charity kitchen, amid a hunger crisis, in Gaza City, July 24, 2025. REUTERS/Khamis Al-Rifi
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Palestinians wait to receive food from a charity kitchen in Gaza City. Pic: Reuters

In other developments:

• Israel and the US have recalled their teams from Gaza ceasefire talks

• US envoy Steve Witkoff has accused Hamas “of failing to act in good faith”

• France has announced that it will recognise the state of Palestine

• An influential group of MPs is calling on the UK to “immediately” do the same

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‘Starvation used as a weapon’

‘They were shells’

Dr Nick Maynard has been going to Gaza for the past 15 years – and this is his third visit to the territory since the war began.

The British surgeon added that virtually all of the kids in the paediatric unit of Nasser Hospital are being fed with sugar water.

“They’ve got a small amount of formula feed for very small babies, but not enough,” he warned.

Dr Maynard said the lack of aid has also had a huge impact on his colleagues.

“I saw people I’d known for years and I didn’t recognise some of them,” he added. “Two colleagues had lost 20kg and 30kg respectively. They were shells, they’re all hungry.

“They’re going to work every day, then going home to their tents where they have no food.”

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Ex-Gaza aid worker claims personnel shot at Palestinians

IDF ‘shooting Gazans at aid points’

Elsewhere in the interview, Dr Maynard claimed Israeli soldiers are shooting civilians at aid points “almost like a game of target practice”.

He has operated on boys as young as 11 who had been “shot at food distribution points” run by the US and Israel-backed Gaza Humanitarian Foundation.

“They had gone to get food for their starving families and they were shot,” he said.

“I operated on one 12-year-old boy who died on the operating table because his injuries were so severe.”

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Gaza deaths increase when aid sites open

Dr Maynard continued: “What was even more distressing was the pattern of injuries that we saw, the clustering of injuries to particular body parts on certain days.

“One day they’d be coming in predominately with gunshot wounds to the head or the neck, another day to the abdomen.

“Twelve days ago, four young teenage boys came in, all of whom had been shot in the testicles and deliberately so.

“The clustering was far too obvious to be accidental, and it seemed to us like this was almost like a game of target practice.

“I would never have believed this possible unless I’d witnessed this with my own eyes.”

Palestinians are brought to Nasser Hospital after being shot by Israeli forces while gathering to receive bags of flour from aid trucks, according to hospital officials and eyewitnesses, in Khan Younis, Gaza Strip, on Thursday, July 24, 2025. (AP Photo/Mariam Dagga)
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Palestinians brought to Nasser Hospital after being shot by Israeli forces, according to hospital officials and eyewitnesses. Pic: AP

Sky News has contacted the Israeli Defence Forces for comment.

An IDF spokesperson previously told Sky News it “strongly rejected” the accusations that its forces were instructed to deliberately shoot at civilians.

“To be clear, IDF directives prohibit deliberate attacks on civilians,” the spokesperson said, adding that the incidents are “being examined by the relevant IDF authorities”.

Read more:
Medics at Nasser hospital struggle to feed children
Gaza food situation ‘worst its ever been’

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Israeli military show aid waiting inside Gaza

The Gaza Humanitarian Foundation has been managing the supply of aid to Gaza since Israel lifted an 11-week blockade in May.

It has four aid distribution sites, all of which are located in Israeli military zones, with journalists prohibited from entering.

More than 1,000 people have been reported killed while trying to receive food aid since the GHF took over, according to the UN.

UNRWA, its relief agency for Gaza, has heavily criticised the scheme.

Commissioner general Philippe Lazzarini said: “The so-called ‘GHF’ distribution scheme is a sadistic death trap. Snipers open fire randomly on crowds as if they are given a licence to kill.”

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Just a fraction of the aid trucks needed are making it into the enclave, the UN has said, while multiple aid groups and the World Health Organisation have warned Gazans are facing “mass starvation”.

Mr Lazzarini quoted a colleague on Thursday and said malnourished Palestinians in the Gaza “are neither dead nor alive, they are walking corpses”.

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Eleven civilians killed as Thailand and Cambodia exchange fire in escalating border dispute

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Eleven civilians killed as Thailand and Cambodia exchange fire in escalating border dispute

Eleven Thai civilians and a soldier have been killed in clashes between Thailand and Cambodia, officials have said, as long-standing tensions in disputed border areas boiled over into open conflict.

Among those killed was an eight-year-old boy, the army said in a statement.

It said most casualties occurred in Si Sa Ket province, where six people were killed after shots were fired at a fuel station.

Smoke and fire in the Kantharalak district in Thailand amid clashes between Thailand and Cambodia. Pic: Army Region 2 via Facebook/Reuters
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Smoke and fire in the Kantharalak district in Thailand amid clashes between Thailand and Cambodia. Pic: Army Region 2 via Facebook/Reuters

Another 14 people have been injured in three Thai border provinces.

Thailand’s health minister Somsak Thepsuthin confirmed the fatalities to reporters, adding Cambodia’s actions, including an attack on a hospital, should be considered war crimes.

Both countries accuse one another of starting the military clashes and have downgraded their diplomatic relations in the rapidly escalating dispute. Thailand has also sealed all land border crossings with Cambodia.

Early on Thursday, a Thai F-16 fighter jet bombed targets in Cambodia, according to Thailand’s army.

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“We have used air power against military targets as planned,” Thai army deputy spokesperson Richa Suksuwanon said.

Cambodia’s defence ministry said Thai jets had dropped bombs on a road near the ancient Preah Vihear temple, saying it “strongly condemns the reckless and brutal military aggression of the Kingdom of Thailand against the sovereignty and territorial integrity of Cambodia”.

What has caused Thailand-Cambodia border clashes?

Thai people who fled clashes between Thai and Cambodian soldiers take shelter in Surin province. Pic: AP
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Thai people who fled clashes take shelter in Surin province. Pic: AP

Fighting has taken place in disputed border areas
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Fighting has taken place in disputed border areas

‘Civilian areas targeted’

Clashes are ongoing in at least six areas along the border, the Thai defence ministry said.

Thailand’s foreign ministry said Cambodian troops fired “heavy artillery” on a Thai military base on Thursday morning and also targeted civilian areas, including a hospital.

“The Royal Thai Government is prepared to intensify our self-defence measures if Cambodia persists in its armed attack and violations upon Thailand’s sovereignty,” the ministry said in a statement.

A livestream video from Thailand’s side showed people, including children and the elderly, running from their homes and hiding in a concrete bunker as explosions sounded.

The clash happened in an area where the ancient Prasat Ta Muen Thom temple stands along the border between Thailand’s Surin province and Cambodia’s Oddar Meanchey province.

Thai people who fled clashes between Thai and Cambodian soldiers in Surin province, northeastern Thailand. Pic: AP
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Thai people who fled clashes in Surin province, northeastern Thailand. Pic: AP

‘Conflict not spreading’

Thailand’s acting premier said fighting must first stop before peace talks can start.

Caretaker Prime Minister Phumtham Wechayachai told reporters there had been no declaration of war and conflict was not spreading into more provinces.

He said Cambodia had fired heavy weapons into Thailand without any specific targets, resulting in civilian deaths.

Earlier on Thursday, Cambodia downgraded diplomatic relations with Thailand to their lowest level, expelled the Thai ambassador and recalled all Cambodian staff from its embassy in Bangkok.

The day before, its neighbour withdrew its ambassador and expelled the top Cambodian diplomat in protest after five Thai soldiers were wounded in a land mine blast, one of whom lost part of a leg.

A week earlier, a land mine in a different contested area exploded and wounded three Thai soldiers, including one who lost a foot.

Relations between the southeast Asian neighbours have collapsed after a Cambodian soldier was killed in an armed confrontation in a disputed border area in May.

Read more on Sky News:
UK’s ‘tough choices’
‘Man-made starvation’ in Gaza
Man ‘scarred’ by Trump max security prison

Nationalist passions on both sides have further inflamed the situation, and Thailand’s prime minister was suspended earlier this month as an investigation was opened into possible ethics violations over her handling of the border dispute.

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Border disputes are longstanding issues that have caused periodic tensions between the countries. The most prominent and violent conflicts have been around the 1,000-year-old Preah Vihear temple.

In 1962, the International Court of Justice recognised Cambodian sovereignty over the temple area.

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