Rachel Reeves delivered her first budget as Chancellor of the Exchequer – and the first budget from a Labour government in 14 years – on Wednesday October 30.
She covered everything from pensions to fuel duty – and you might be wondering what these plans actually mean for you.
We have spoken to some experts who have shared their praises, and a few reservations, about these new measures.
Pensions
“Many pensioners will be glad to hear that the triple-lock will be preserved and state pensions will be increased by up to £470, or 4.1%, next April,” said Adam French, senior personal finance expert at NerdWallet. “While this may be welcomed news, pensioners will also need to consider how other changes, such as the cut in winter fuel payment, will impact their personal finances.
“Reeves’ decision to not extend frozen income tax thresholds beyond 2028 is also welcome news for many pensioners who are getting taxed on their pension payments above the personal allowance.
“However, until then, more of them will be paying out an ever greater proportion of their pension payments in tax and facing a higher tax burden with each passing year.”
Fuel
Reeves also announced that she will freeze fuel duty next year and will maintain the existing 5p cut for another year.
“We welcome the announcement of a continued fuel duty freeze and an extension of the 5-pence-per-litre price cut,” said Matthew Briggs, CEO at business fuel card provider Right Fuel Card:Edenred. “Whilst, positively for consumers, fuel prices are on a downward trajectory, there is still work to be done to support those struggling to cover costs.”
Education
Investment in breakfast clubs is to be tripled, and SEND funding will be uplifted by £1bn.
The core education budget is also going up by £2.3bn, and £300m for further education.
“We applaud the government’s boost in education funding, a vital step toward a strong start for every child. More teachers and meaningful investment will help provide a more equitable education for all students,” said Russell Winnard, former teacher and COO at Young Enterprise. “However, to maximise the impact of this funding, we urge the government to focus on strategic initiatives that help embed practical and applied learning opportunities.
The Fawcett Society also shared their view on the topic.
“Soaring childcare costs and unpaid care work still present a major barrier to work for mothers, so Fawcett is pleased to see the Chancellor sustain funding for early years and increase funding for schools and SEND provision,” said Jemima Olchawski, Fawcett Society chief executive. “However, we are disappointed not to see the major investments needed to end the motherhood penalty for all – we hope that a full revamp of early education will be part of the Spring Spending Review.”
Minimum wage
The National Living Wage for people aged 21 or older will rise by 6.7% from £11.44 an hour to £12.21 from next April.
In addition, the National Minimum Wage will rise for people aged between 18 and 20-years old, from £8.60 to £10.
Apprentices will also get a big pay bump, with hourly pay increasing from £6.40 to £7.55.
“An increase in the living wage will be welcomed by the more than one million low-paid workers in line for a pay rise next year,” said French. “However, this figure is still some way short of the so-called ‘real living wage’ which currently sits at £12.60 per hour (£13.85 in London) according to the Living Wage Foundation.
“It means that even after this pay rise, a full-time worker will be almost £50 short of covering everyday living costs and maintaining living standards each month – a figure that jumps to £200 for workers in London.”
Carers allowance
On the Carer’s Allowance, Reeves said the amount that carers can earn while receiving the allowance will rise to the equivalent of 16 hours at the National Living Wage per week.
A carer can now earn over £10,000 a year whilst receiving the allowance.
“It’s fantastic to hear that the Government will increase the earnings threshold for Carer’s Allowance, allowing 60,000 more carers juggling work and care to access this benefit,” says Helen Walker, chief executive at Carers UK. “It’s the largest increase in the earnings limit for Carer’s Allowance since it was introduced in 1976.
“It will help to put much needed cash into the pockets of working carers who do so much to look after their disabled, ill and older relatives.”
Health
Speaking on the NHS, Reeves announced a £22.6bn increase in the day-to-day health budget, and a £31bn increase in the capital budget, which she says is the largest increase in spending outside of Covid since 2010.
The Chancellor said she hopes these measures will bring down waiting lists and increase the capacity for procedures in the NHS.
“Today’s announcement of a £22.6 billion NHS funding boost to cut waiting lists is a promising step, but it must be strategically directed to enhance cancer care specifically,” says Malcolm Packer, CEO of Kidney Cancer UK. “Reducing diagnostic delays is critical and requires immediate investment in MRI and CT scanners, along with a substantial increase in trained diagnostic staff, to address life-threatening backlogs.
“Additionally, resolving staffing shortages in primary care and oncology is essential to enabling faster treatment starts and consistent care – both vital for improving patient survival and quality of life.”
Workplace protection
Reeves also mentioned in her speech that her government will protect working people from unfair dismissal, safeguard them from bullying in the workplace, and improve their access to paternity and maternity leave.
“Today’s budget offers some promising steps toward building fairer, safer workplaces,” says Jodie Hill, founder of Thrive Law and employment law specialist. “The introduction of stronger protections against unfair dismissal, measures to tackle workplace bullying, and better access to parental leave could be genuinely life-changing for new parents and individuals navigating difficult work environments.
“However, there’s still a significant gap in action on gender pay equality.”
