By Salma El-Sakka
Chancellor John Healey will deliver the Burnham government's first budget in the Commons on Wednesday at 12:30pm, framing it as a series of measures to give "breathing space for today, fresh hope for the future" to low- and middle-income households. The Treasury has signalled a deliberately low-key event, with many proposals already briefed and the chancellor ruling out rises in capital gains tax or changes to the mansion tax while committing to Labour's fiscal rules.
Modest measures amid fiscal constraints
The budget comes as the Iran war pushes up borrowing costs and erodes spending power. Guardian policy editor Kiran Stacey described it as far smaller than last year's and not an attempt to end "40 years of neoliberalism". The government has already announced the abolition of a rule that plunged unpaid carers into debt and a pause in equalising the lower national minimum wage for under-21s with the national living wage.
Energy bills and food costs
Healey is considering making the warm homes discount more generous, though it only reaches those on benefits. Thinktank Common Wealth argues a structural plan such as an energy guarantee priced at pre-crisis levels is needed, but tax decisions have limited that scope. On food, the removal of import tariffs on items including baked beans, chocolate and gherkins is estimated to save the average household just £21 a year.
Housing and fuel duty
The chancellor is expected to confirm an additional £1bn for the largest council housebuilding programme since the postwar decade and detail a new Your First Home scheme for first-time buyers. Meanwhile, local housing allowance has been frozen since 2024, leaving over 900,000 private renters on universal credit facing an average £158 monthly shortfall. The freeze on fuel duty, introduced in 2022, will continue, though economists note it largely benefits higher-income drivers.
Readers highlight daily struggles
First Edition readers shared how rising costs affect them. Michael, a father of three in Winchester, spends £165 monthly on energy and has only £300 a week left after rent. Sue from west Kent called for more council housing. Pat from Aberdeen urged lower fuel prices, noting the fuel duty freeze does little for those on low incomes who must drive.
