THE Chancellor has unveiled a Budget that aims to deliver on the country’s priorities of cutting the cost of living, reducing NHS waiting lists and driving down borrowing and debt.

Millions of hardworking families struggling with household costs will benefit from Rachel Reeves’ “inflation-busting” decisions, with decisive action to cut £150 off energy bills, freeze rail fares and a historic move to lift 450,000 children out of poverty.

Chancellor of the Exchequer, Rachel Reeves said: “I can tell you today that, for every family we are keeping our promise to get energy bills down and cut the cost of living with £150 taken off the average household energy bill from April.

“Money off bills, and in the pockets of working people. That is my choice.

Upgrading the UK’s economic growth this year to 1.5 per cent from one per cent in the Spring, the government’s fiscal watchdog the Office for Budget Responsibility (OBR) said the choices taken in the Budget would reduce inflation by 0.4 per cent next year.

The Chancellor said the Budget includes a range of measures to cut bills and boost pay packets as many families are still struggling with the cost of living.

Front and centre of the plans is a move to take £150 off energy bills to lower inflation and ease pressure on family finances. Poorer households will save up to £300 when combined with the Warm Homes Discount.

In a range of further measures designed to ease the cost of living, commuters will save hundreds of pounds on their season tickets after rail fares were frozen for the first time in 30 years. An extension of the temporary 5p fuel duty cut for an extra five months, a further fuel duty freeze, and the new UK wide Fuel Finder scheme will save the average driver £89, and full time workers on the National Living Wage and National Minimum wage will see a £900 pay-packet boost. Full-time workers on the 18-20 National Minimum Wage rate will see a £1,500 rise.

The Chancellor announced 250 new Neighbourhood Health Centres and expanding more services back into communities so people can get better, faster care locally.

Reeves was also clear that the government would be relentless in driving out waste so that every penny of public money is spent wisely. She reaffirmed plans to cut the cost of politics, by abolishing Police and Crime Commissioners and 5,000 councillors which together save more than £250-million over five years while the continued crackdown on Covid fraud is estimated to deliver almost £400-million.

Currently, £1 in every £10 the public sector spends now goes on debt interest - four times what we spend on nurses. The Chancellor made clear there was nothing progressive about this and set out plans to cut borrowing and debt by spending “wisely,” reforming welfare and making fair choices on tax.

The Chancellor said she was determined to double down on the decisive action to grow the economy and create good jobs, building on the action already taken including increasing public investment by over £120 billion over the Parliament, creating the National Wealth Fund, which has already invested £3.8 billion, backing builders not blockers through the biggest planning reforms in a generation and supporting the expansion of Heathrow and Gatwick airports, plus the construction of Sizewell C.

She announced she would be supporting high streets with permanently lower tax rates for 750,000 retail and hospitality properties and backing entrepreneurs and fast-growing companies with tax breaks to hire and list in the UK.

Other measures to boost growth include funding hundreds more planners across England to supercharge the government’s commitment to build 1.5-million homes, extending the DLR to Thamesmead, unlocking thousands of new homes and jobs, investing further in the Lower Thames Crossing, building the UK’s first Small Modular Reactors at Wylfa on Anglesey, introducing a first-of-its-kind three-year stamp duty holiday for new UK-listed companies, saving firms up to £50-million per year and increasing share prices and reforming ISAs to get more people investing and drive £4-billion of investment into our stock market.

On tax, the Chancellor set out “fair and necessary” choices that will deliver on the public’s priorities to cut the cost of living, NHS waiting lists and borrowing. She said she would be implementing the major reforms to protect employees pay slips but also cut their energy bills.

The current personal tax thresholds will be frozen from 2028 to 2031, but those with broader shoulders will contribute more through fair reforms previously ducked for too long. Taxes on property, dividend and saving income – which currently face no equivalent of National Insurance – will be increased by 2p, narrowing the tax gap between landlords and tenants, with additional allowances to protect those with small amounts of such income.

A typical family home in England pays more council tax than a £10-million Westminster mansion, so the Budget also introduces a High Value Council Tax Surcharge on homes worth more than £2-million, while protecting those on low incomes.

The Budget also set out reforms to well-intentioned tax reliefs which have seen significantly increasing costs that disproportionately benefit the wealthy. From April 2029, the government will charge employee and employer National Insurance on any pension contributions made via salary sacrifice above £2,000 a year and halve capital gains tax relief for bosses selling their businesses to Employee Ownership Trusts from 100 per cent to 50 per cent to retain a strong incentive for employee ownership while ensuring business owners pay their fair share.

In moves to update the tax system for a modern-day economy the government is introducing a new per mile levy for electric and plug-in hybrid cars, coming in 2028. All cars contribute to wear and tear on our roads, so it is only right that our motoring taxes cover EVs via a modest per mile levy, with extra support to keep EV ownership attractive.

Responding to the significant growth in online gambling which has boosted revenues while increasing social harms, the government will increase online gambling duties, raising more than £1-billion a year. In-person gambling for horseracing will be protected with the government also scrapping bingo duty to recognise the cultural value these provide for millions across the country.

Fuel prices are now at their lowest in real terms for a decade. To support motorists, the government is extending the temporary 5p cut to fuel duty for a further five months until the end of August 2026, as well as cancelling the planned inflation increase for 2026/27. After this extension, the fuel duty rate will gradually return to early 2022 levels.

The Budget also set out a series of measures to fix a broken welfare system that has left millions written off as too sick to work.

The historic decision to remove the two-child limit in full from April 2026 will lift 450,000 children out of poverty. When combined with other previously announced measures such as the expansion of free school meals, this will take 550,000 children out of poverty. This will lead to the biggest reduction in child poverty over a parliament since records began.

The Chancellor also announced reforms to Motability, removing luxury cars from the scheme and saving taxpayers over £1-billion over five years. The Budget also supports the long-term youth unemployed by offering them a guaranteed job instead of benefits and closes the loophole that allows people living abroad to buy a UK State Pension at a reduced rate.