John Healey, the UK Chancellor of the Exchequer, has pledged to use his forthcoming budget to provide consumers and businesses with much-needed relief amid rising costs, while maintaining adherence to established fiscal rules. Speaking from Bangkok, where he was attending the International Monetary Fund’s annual meetings, Healey emphasized that his budget, due on October 28, aims to offer Britain a measure of "breathing space" without compromising the country’s long-term economic resilience.
The chancellor acknowledged the financial pressures facing households and enterprises, noting that the government has already taken steps to ease energy costs by cutting VAT on electricity bills. Healey is anticipated to announce further energy support ahead of an expected sharp rise in the energy price cap scheduled for January. He highlighted that the prime minister has stressed the importance of addressing business costs alongside the cost of living.
Healey reaffirmed his commitment to the spending limits set by his predecessor Rachel Reeves in last year’s spending review. He suggested that any new funding priorities will have to be managed within existing departmental budgets through reprioritization, acknowledging the current pressures on government departments. “Colleagues are doing a good job of managing with what they’ve got,” he said.
The UK has received positive recognition from the IMF for its approach to reducing the national deficit, with IMF Managing Director Kristalina Georgieva encouraging the government to “stay the course.” Healey welcomed this endorsement, noting that the fund’s support reflects not only optimistic forecasts but also emerging evidence of fiscal performance.
Regarding potential tax changes, Healey declined to comment on whether the budget would include increases to bank taxes or capital gains tax to counterbalance rising energy costs and borrowing expenses. He cautioned against premature speculation about budget details, which he said in the past had led to unhelpful economic behaviors such as early pension withdrawals or reduced business investment.
Beyond domestic economic measures, Healey indicated that the upcoming budget will feature an enhanced support package for Ukraine, encompassing military, diplomatic, and economic assistance. He underscored the importance of Ukraine’s future to European security, particularly in light of ongoing Russian attacks on Ukrainian energy infrastructure amid a looming harsh winter. “It is crucial that Putin does not prevail,” Healey said.
On the international stage, Healey co-chaired a G20 meeting of policymakers with Bank of England Governor Andrew Bailey on Thursday morning, filling in for the absent US Treasury Secretary Scott Bessent. He plans to return to London Thursday evening to finalize his budget ahead of its public unveiling.