Autumn Budget 2026: ‘Steady as she goes’ is no good when the economy’s adrift
John Healey avoided several icebergs but there are nasty storms on the horizon, says William Nixon The Chancellor opened his speech by claiming the Budget would help “steer” the UK’s economy through “global economic storms”. He can be commended for avoiding the twin icebergs of major new tax hikes and pre-Budget speculation that sank Rachel [...]
The Autumn Budget 2026 aimed to "steer" the UK's economy through global economic storms, but Chancellor John Healey's 'steady as she goes' strategy may not be enough. The economy is currently "adrift at sea," facing a major energy price shock and multiple rate hikes from the Bank of England. The combination of higher fuel prices, a likely 25% rise in energy bills next year, and a 1 percentage point increase in interest rates is set to reduce households' average annual disposable income by around £1,000.
Higher borrowing costs and potential tax increases will make existing problems worse. The labour market is another major concern, with a multi-year high of 2.5 unemployed workers relative to new job ads. While some proposed policies, such as reducing VAT on electricity bills and providing temporary energy bill assistance, offer some relief, they are small changes that won't significantly address the looming storm.
A more comprehensive and transformative approach is needed to stabilize the economy and restore confidence.
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