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.”
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.
More on Budget
Related Topics:
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.
Advertisement
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.”
Please use Chrome browser for a more accessible video player
2:54
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, a key battleground in the next election, the chancellor is expected to change the rules so that parents on Universal Credit are given more childcare and given the funding upfront.
The Treasury is also believed to be planning a hundreds of millions cash injection into expanding access to 30 hours of free access to the over threes.
The chancellor also plans to loosen staff to child ratios for two-year-olds, which could make the cost of childcare a little cheaper.
He is also planning to extend the provision of up to 30 hours a week to one and two-year-olds which could form a central plank in his pitch of helping with the cost of living and getting parents into work.
Please use Chrome browser for a more accessible video player
1:54
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.
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.
Image: 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.
A league table of foreign criminals and their offences is set to be published for the first time.
The plans, due to be announced on Tuesday, will reportedly focus on those offenders awaiting deportation from the UK.
The latest data shows there were 19,244 foreign offenders awaiting deportation at the end of 2024, a rise from 17,907 when the Conservatives left office in July and 14,640 at the end of 2022.
Despite more offenders being deported since Labour came to power, the number waiting to be removed from the UK has been growing.
Factors are understood to include the early release of inmates due to prison overcrowding, instability and diplomatic problems in some countries and a backlog of legal cases appealing deportation.
Shadow home secretary Chris Philp said the decision to publish the nationalities of foreign criminals showed Labour had “buckled” under pressure from the Conservatives to disclose the data.
The latest government statistics show there were 10,355 foreign nationals held in custody in England and Wales at the end of 2024, representing 12% of the prison population.
More on Crime
Related Topics:
The most common nationalities after British nationals were Albanian (11%), Polish (8%), Romanian (7%), which also represented the top three nationalities who were deported from the UK in 2024, according to Home Office figures.
Home Secretary Yvette Cooper is understood to have ordered officials to release the details by the end of the year, according to The Daily Telegraph.
The newspaper reported Ms Cooper overruled Home Office officials, who previously claimed it was too difficult to provide quality data on foreign criminals.
A Home Office source said: “Not only are we deporting foreign criminals at a rate never seen when Chris Philp and Robert Jenrick were in charge at the Home Office, but we will also be publishing far more information about that cohort of offenders than the Tories ever did.”
The source added that ministers wanted “to ensure the public is kept better informed about the number of foreign criminals awaiting deportation, where they are from and the crimes they have committed”.
Datawrapper
This content is provided by Datawrapper, which may be using cookies and other technologies.
To show you this content, we need your permission to use cookies.
You can use the buttons below to amend your preferences to enable Datawrapper cookies or to allow those cookies just once.
You can change your settings at any time via the Privacy Options.
Unfortunately we have been unable to verify if you have consented to Datawrapper cookies.
To view this content you can use the button below to allow Datawrapper cookies for this session only.
Foreign nationals sentenced to 12 months or more in prison are subject to automatic deportation, but the home secretary can also remove criminals if their presence in the UK is not considered desirable.
Shadow justice secretary Robert Jenrick welcomed the news, saying: “We will finally see the hard reality that mass migration is fuelling crime across our country… Frankly, the public deserved to know this [detail on foreign criminals] long ago.”
Rachel Reeves will pledge to “stand up for Britain’s national interest” as she heads to Washington DC amid hopes of a UK/US trade deal.
The chancellor will fly to the US capital for her spring meetings of the International Monetary Fund (IMF), the first of which began on Sunday.
During her three-day visit, Ms Reeves is set to hold meetings with G7, G20 and IMF counterparts about the changing global economy and is expected to make the case for open trade.
The chancellor will also hold her first in-person meeting with her US counterpart, treasury secretary Scott Bessent, about striking a new trade agreement, which the UK hopes will take the sting out of Mr Trump’s tariffs.
In addition to the 10% levy on all goods imported to America from the UK, Mr Trump enacted a 25% levy on car imports.
Ms Reeves will also be hoping to encourage fellow European finance ministers to increase their defence spending and discuss the best ways to support Ukraine in its war against Russia.
Speaking ahead of her visit, Ms Reeves said: “The world has changed, and we are in a new era of global trade. I am in no doubt that the imposition of tariffs will have a profound impact on the global economy and the economy at home.
“This changing world is unsettling for families who are worried about the cost of living and businesses concerned about what tariffs will mean for them. But our task as a government is not to be knocked off course or to take rash action which risks undermining people’s security.
“Instead, we must rise to meet the moment and I will always act to defend British interests as part of our plan for change.
“We need a world economy that provides stability and fairness for businesses wanting to invest and trade, more trade and global partnerships between nations with shared interests, and security for working people who want to get on with their lives.”
A woman who was stabbed to death in north London has been named by police – as a man was arrested on suspicion of murder.
Pamela Munro, 45, was found with a stab wound and died at the scene in Ayley Croft, Enfield, on Saturday evening, the Metropolitan Police said.
A 29-year-old man was arrested on suspicion of murder on Monday and is in custody, the force added.
Detective Chief Inspector Neil John said: “Investigating officers have worked relentlessly across the weekend to investigate the circumstances around Pamela’s death.
“We continue to support her family who are understandably devastated.”
Image: Police at the scene at Ayley Croft in Enfield
The Met Police has asked anyone with information or who was driving through Ayley Court between 6.30pm and 7.30pm on Saturday and may have dashcam footage to contact the force.