What’s driving the day in Westminster. Politics and policymaking in the UK capital. By ANDREW MCDONALD with MEGAN MCELROY Good Wednesday morning .
This is Andrew McDonald. DRIVING THE DAY DIAL BACK THE ENERGY? John Healey will finally deliver his first budget this lunchtime — and then the spin really begins.
Treasury aides and ministers will work hard to sell today’s “breathing space” tagline, with interventions to ease rising energy bills, while hacks and opposition parties rake through the small print and the OBR reports to wheedle out hidden nasties. Budgets are curious beasts, after all, where one unexpected detail can lead the news agenda for days. Although ... given the lower-octane feel to this fiscal event, it could become defined by the bits that aren’t in it.
How the day will play out: Burnham will chair his Cabinet for an hour-long pre-budget pep talk at 8.30 a.m. ... Healey poses on the street with his red box ... Burnham leads the annual irrelevance of pre-budget PMQs at noon ...
Healey presents his budget with an hour-long speech at 12.30 p.m. ... the OBR releases its economic forecasts for the next five years as the chancellor sits down, around 1.30 p.m. ... Simultaneously, Kemi Badenoch responds for the opposition while a pack of lobby hacks grill Treasury officials ... The OBR’s Richard Haskell gives a Slido briefing at 2.30 p.m. as all the wonk verdicts, including the IFS at 3.30 p.m, start piling in ... and then Treasury ministers will be everywhere on the afternoon media round as the spin game begins.
Healey is off on a post-statement visit where he’ll take some questions. The big numbers in the red book everyone will be obsessing over: “Headroom” and how much lower it is than the £24 billion Rachel Reeves left ... departmental spending ... and total tax rises, expected to be lower than the £26 billion from Reeves last year. But it’s the OBR and other wonks who will give us a much deeper projection of things like disposable incomes, inflation, growth and debt — and whether they reckon the arc of Healey’s five-year plans is realistic, or he’ll just have to come back for more.
But before all that. What’s actually in today’s budget? THE GOSPEL OF JOHN (AND MARTIN): We’ve known for some time there will be short-term action on energy prices.
An increase in the Warm Home Discount Scheme was first mooted by the Guardian weeks back and never knocked down, with fresh detail in the i Paper last night ... the Sun got the annual fuel duty freeze scoop ... and Burnham himself said at PMQs last week he’d asked ministers to look at removing standing charges from gas bills. Healey is hosting Money Saving Expert Martin Lewis in No. 11 right now and said his budget will “draw a line in the sand” on energy policy. And lo ...
On that note: Treasury spinners just pumped out a surprise press release saying Healey will indeed remove gas bill standing charges for “around 23 million homes.” Households won’t save the average £108 that these cost per year, because the fixed costs will be moved onto the unit rate instead. The Treasury release reckons 60% of account-holding households “could save” an average of £45 a year — so it sounds like the devil is in the detail of this one. Is that a ... green rabbit?
Earlier Healey, in a pre-budget video, nodded that something more is incoming — promising “long-term action” to get energy costs down. The Times splash reckons he will remove green levies from energy bills , putting them instead on general taxation. The argument goes that this will (obviously) reduce energy bills, while also leaving bills less exposed to those global energy shocks we keep experiencing.
But ... there’s much we don’t know. If none of the underlying green schemes are gutted or scrapped, that would suggest the money has to be found from somewhere else. No one tell the dude who has to deliver a spending review next year.
You come at the green king, you best not miss: More details were in the Telegraph, which heard similar via Szu Ping Chan and Jonathan Leake. They hear the Treasury will announce a new “levy control” framework giving it and No. 10 greater control over future green charges, taking the power from DESNZ. “Ed [Miliband] had this sovereign view of DESNZ that it was essentially a tax-and-spend department, and they could put levies on bills to spend it on whatever they wanted.
This will help to stop that,” is the striking source quote in the paper from a person familiar with the plans. Funnily enough, Miliband won’t be at the budget today as he’s on business abroad. Who remembers when he was nailed-on to be the next chancellor?
Either way: The backdrop to all this is scary estimates about rising bills — and fears the war in Iran could escalate after the U.S. Midterms, making it all even worse (and swiftly making the OBR predictions outdated. EDF was predicting an impending 27% rise in bills yesterday , for example.
One obvious fag packet calculation: When you add up all of today’s help with energy bills, how much higher or lower will it be than £276 per year? That’s the rise that Cornwall Insight projects in January . Politicians who help with energy bills have previously found themselves running to stand still, as Liz Truss could tell you .
It’s little wonder Energy Secretary Miatta Fahnbulleh told hacks at a lobby lunch last week that “we will win or lose the next election on our ability to make progress on the cost of living.” Some of that ... will hinge on Britain’s policy on oil and gas. Fahnbulleh told the same journalists the Treasury had no influence over her looming decision on the Rosebank oilfield as “only I can make it.” For good measure she added: “And if it is overturned by other colleagues, all that means is we’re going to be overturned in the courts.” Just one problem ... Cheers DESNZ is crying .
Nice one: DESNZ wasn’t responding last night to reports in the Times and the Guardian claiming the Treasury’s big book of costing calculations “assume” Rosebank will be approved — and will generate significant tax revenues. That’s a pretty whopping assumption, given the decision is “quasi-judicial” and supposed to be completely up to DESNZ. Check the small print, then brace for the legal challenges.
Also troubling some Labour MPs: A Budget Eve row emerged while Treasury officials were chomping down on a Nandos and Healey was rehearsing his speech in HMT HQ last night. Some Labour MPs are furious after getting the impression the budget will not follow Rachel Reeves’ 2024 lead in transferring part of the remaining funds in the Mineworkers’ Pension Scheme to former pit workers, PoliticsHome’s Harriet Symonds reports . Urgent representations were said to have been made to the government.
Burnham said when campaigning for Makerfield said he would fight for miners to “make sure every promise is honoured and every penny reaches the people it is meant for.” Hmm. Other new nuggets we know about: Back to the rest of it, and there were some more last-minute, well-sourced predictions that somehow evaded the budget’s military-style security measures. The Telegraph’s Tony Diver reports NHS prescription charges will be frozen for another year ...
The FT team reckons Healey will scrap plans to slash the annual cash ISA allowance ... and the Guardian’s Jessica Elgot reveals the Treasury will give £15 million to a dedicated fund to tackle misogyny in workplaces, schools and public places. And then there’s all of the stuff from weeks of sanctioned and unsanctioned briefings. Confirmed and already announced: A shake-up of the government’s investment, or “green book” rules ... some red-tape slashing ... a £600 million package to protect the U.K. from AI risks ...
“Good Growth funding” for local leaders to spend on investment projects ... and then Tuesday’s “everyday fixes”: permanent higher tax-free mileage rates; extending parental pay; a tapered Carer’s Allowance cut-off point; more Post Office drop boxes and cheaper gherkins. Also widely expected: A rise in the minimum wage, but a slower rise for younger workers ( Times ) ... some more measures aimed at helping small businesses ... adding 2p to alcohol duty ( Telegraph ) ... increasing the surcharge on bank profits ... shielding low-income pensioners from paying income tax when the state pension rises ( Times ) ... a tax crackdown on online retailers ... and the chancellor is expected to cover a £4.7 billion shortfall in the Defence Investment Plan. Maybe: A more generous Help to Buy scheme has been mooted , but might not come today ... the bookies are wary of more hikes to betting duty (Guardian) ... remember Burnham’s promise to “re-examine” what has been dubbed the “family farm tax” ... and the expectation is no changes to income tax thresholds.
Not happening: Any truly seismic revenue-raising tax changes. A rise in capital gains tax has been briefed out of existence ... as has lowering the threshold of the mansion tax ... the government is waiting for the Milburn and Timms reports before bringing forward any welfare reforms, a decision which splashes the Mail ... and the plan to get to 3% of GDP on defense spending is expected to come in the spending review, though my colleagues note the Treasury has suggested there could be something in the budget to set down a marker. And on that note ...
It’s the absences that could leave a bit of a sour taste by the end of the day. This will sting: Ukrainian President Volodymyr Zelenskyy has used an interview with the Sun on the eve of the budget to warn Healey not to delay a big increase in defense spending. Which, whatever Healey says today about new cash for the MoD, is exactly what he’s doing with the 3% roadmap pushed to next year.
“Defence needs to be 100% the priority,” Zelenskyy told the Sun’s Paul Sims. “My advice to John is don’t delay. Sorry John ... but it’s important to be direct.” If Playbook had any life savings, your author would be betting every dime on Kemi Badenoch quoting that at some stage.
Probably less of a sting: Here’s the final word from the opposition parties. The Conservatives accuse the chancellor of kicking the can down the road and say the budget is more of the same: higher taxes and no action on welfare ... Reform UK argues John Healey is “fiddling while the economy burns” and say the country needs a break-glass budget.
Nigel Farage and Robert Jenrick will hold a press conference at 3.30 p.m. in Westminster ... the Lib Dems say the country needs change and “steady as she goes” won’t cut it, calling for energy bills, fuel duty and VAT on hospitality to be slashed ... and Green leader Zack Polanski last night delivered a version of a “rally speech,” describing the government as “cowardly” and the budget as a “betrayal” and calling for “rip-off Britain” to be ended. And while you wait: Read these learned takes from my colleagues on what they’re looking out for in each policy area , and listen to the daily Politics at Sam and Anne’s podcast out at the normal time — and then again in the late afternoon for a post-budget special. Playbook will leave you with this take from a business contact who has been engaging with the government in the lead up: “It’s a bit continuity Starmer — and also surprisingly unpolitical, almost like a budget written by officials.” Will Healey have defied expectations by this time tomorrow?
TODAY IN WESTMINSTER WATER (DOESN’T) WORK: First Secretary of State Louise Haigh has written to the CEOs of South East Water, South West Water and Southern Water to demand they share data and their contingency plans with the government. It sounds like a right telling off after the severe drought in the firms’ patches. Interestingly, a government official tells Playbook one thing under consideration is the idea of “embedding” government officials in water companies to monitor progress.
LIB DEM LAND: The Lib Dems are privately planning for an election on Dec. 10, the Times’ Aubrey Allegretti reports . According to a memo from Lib Dem grandee Mark Pack, who chairs the Libs’ election committee, the party reckons there’s roughly a 30% chance of a winter election and the party wants to be ready for it. NOT APPEARING TODAY: Under-fire national security adviser Jonathan Powell has dropped out of a Chatham House event on “lessons from Colombia and Northern Ireland.” COMING ATTRACTION: Reform UK will name a spokesperson for the Armed Forces on Thursday Nov. 5, a party official confirmed last night.
Reform members have been invited to a special event to unveil the individual — a man who has served in the military. ON BUDGET EVE : The soft-left Tribune group of Labour MPs elected a new executive committee at its AGM last night, our Dan Bloom texts in, after a bunch of its members ended up in the Burnham government. The committee is Debbie Abrahams ...
Dawn Butler ... Anneliese Dodds ... Clive Efford ...
Abtisam Mohammad ... Simon Opher ... and Tony Vaughan . Just in time to mount the barricades on welfare reform, right?
SHARING IS CARING: Britain’s equality watchdog wants workers to have the legal right to see their colleagues’ salaries and bonuses, according to reporting from the Times . The Equality and Human Rights Commission is calling for employers to be legally required to respond to pay questionnaires, which goes further than a government-proposed voluntary system. NICE FOR SOME: The Sun’s Martina Bet reports that the Cabinet Office spent £33,000 on a four-day leadership retreat at the end of April for 20 senior public sector officials at Hartwell House in Buckinghamshire.
The government insisted to the Sun it was part of their 12-month Public Leaders Programme and said the training was delivered in-house to avoid expensive consultants ... and it cost 30 percent less than a comparable private sector program. Bargain! SW1 EVENTS: U.K. defense company QinetiQ will be celebrating its 25th anniversary in Parliament (6 p.m.).
REPORTS OUT TODAY: Thames Freeport and Freeport East are calling for No. 10 to take more responsibility for freeport policy, with a plan to hand mayors more oversight. HOUSE OF COMMONS: Sits from 11.30 a.m. with Scotland questions ... PMQs at 12 p.m. followed by Chancellor John Healey delivering the budget ... and Green MP Ellie Chowns has the adjournment debate on flood resilience.
WESTMINSTER HALL: Debates from 9.30 a.m. on topics including higher education funding (Labour MP Abtisam Mohamed ) ... rugby league (Labour MP Jon Trickett ) ... dangerous driving sentences (Labour MP Alex Barros-Curtis ) ... and planning (Conservative MP Wendy Morton ). On Committee corridor: National Energy System Operator bosses are grilled by the energy committee (9.15 a.m.) ... Work and Pensions Minister Maeve Sherlock gives evidence on Child Maintenance payments (9.30 a.m.) ...
Reform UK MP Danny Kruger shares thoughts on the U.K.’s constitutional safeguards (10.10 a.m.) ... children’s services experts give evidence on social care (11 a.m.) ... campaign group leaders including Peter Leary of Palestine Solidarity Campaign give evidence on the right to protest (2.15 p.m.). HOUSE OF LORDS: Sits from 3 p.m. with oral questions on topics including Child Trust Funds, vocational GCSEs, LED lighting and the Independent Football Regulator ... and the committee stage of the Health Bill. BEYOND THE M25 HORRIBLE READING: The details in this court case about former Conservative councillor Philip Young, who has admitted to drugging and raping his ex-wife over 13 years.
More in the BBC here as the trial continues . GHOSTS OF HOLYROOD: Scottish Conservative MSP Craig Hoy has called on the SNP to scrap its policy against compulsory redundancies after revelations about 800 “ghost workers” in Scotland’s public sector. A Sunday Times investigation found almost 800 workers whose jobs no longer exist are costing the taxpayer almost £27 million a year.
Deputy FM Jenny Gilruth declined to say whether the policy will be reversed. GREEN LIGHT: The Scottish government has approved the construction of a gas-fired power station at Peterhead. Environmental groups tell the BBC it locks Scotland into a dependence on fossil fuels, but supporters highlight that provisions for carbon capture at the station could reduce emissions from the site by more than 90 percent. **The Autumn Budget is here.
What does it mean for your sector? Join POLITICO Pro's journalists tomorrow for exclusive briefings unpacking the announcements and what comes next for U.K. Financial Services, Energy & Climate, Technology and Trade.
Register for free **. AROUND THE WORLD ISRAEL UNDECIDED: Exit polls in Israel suggest that there’s no clear election winner, which could lead to weeks of jockeying before a new government is formed. Benjamin Netanyahu and his main rival Gadi Eisenkot were seeking the 61 seats required for a majority.
More from our U.S. colleagues . Not that everyone is losing sleep over the outcome: Data gathered by The POLITICO Poll ahead of the vote suggests the outcome won’t resonate in the U.S., where most will greet any new leader in Israel with shrugging indifference. BOLSONARO FLEES BRAZIL: Failed presidential candidate Flávio Bolsonaro and his family have touched down in Florida after fleeing Brazil, where he’s under investigation for corruption and money laundering, the FT reports .
A senior U.S. State Department official told AP the family will be granted visas . BAHAMA DRAMA: King Charles’s visit to the Bahamas is in full swing, starting with a visit to see the defense forces in the morning.
He’ll nip to Bonefish Pond National Park and then go to a boxing academy for young people — all while trying to avoid scheduled reparations protests . Yesterday he acknowledged “the great suffering of the past.” The Mirror has a write-up . OIL TOGETHER NOW: The White House and the Kremlin have reportedly suggested that a joint venture involving U.S. and Russian oil companies could resume off the coast of the Far East island of Sakhalin after the Ukraine war ends.
The FT has the write-up. MEDIA ROUND Shadow Chief Secretary to the Treasury Richard Fuller broadcast round: Times Radio (7.45 a.m.) ... GB News (8 a.m.) ...
Talk (8.20 a.m.) ... LBC News (8.45 a.m.) ... Sky Mornings (9.20 a.m.).
Reform UK MP Danny Kruger broadcast round: GB News (7.45 a.m.) ... Times Radio (8.35 a.m.) ... Talk (8.50 a.m.) ...
Sky Mornings (9.10 a.m.). Also on Times Radio Breakfast: Labour MP David Pinto-Duschinsky (7.05 a.m.) ... financier and peer Dominic Johnson (7.35 a.m.). Also on Sky Mornings: Lib Dem MP Mike Martin (7.40 a.m.) ... former Chancellor Jeremy Hunt (8.15 a.m.) ... former IFS Director Paul Johnson (8.30 a.m.).
Also on Sky’s budget special (from 10 a.m.): Chief Secretary to the Treasury Emma Reynolds ... Labour MP Darren Jones ... Institute for Fiscal Studies Director Helen Miller ...
TUC General Secretary Paul Nowak ... Reform UK MP Andrew Rosindell ... Green Party Westminster leader Ellie Chowns ...
Lib Dem MP Josh Babarinde ... former Labour parliamentary candidate Faiza Shaheen ... Shadow Energy Minister Harriet Cross ... former Reeves adviser Matt Pound . On Politics Live (BBC Two, 11.15 a.m.): Emma Reynolds ...
Shadow Financial Secretary Gareth Davies ... Labour MP Liz Kendall ... Jeremy Hunt ...
Danny Kruger ... Lib Dem deputy leader Daisy Cooper ... Ellie Chowns ...
SNP Westminster leader Dave Doogan ... Plaid Cymru’s Ben Lake ... Helen Miller .
TODAY’S FRONT PAGES POLITICO UK : UK budget 2026: What we’re watching Daily Express : Kemi: Labour is coming for your pay packets. Daily Mail : £6 billion budget benefits bonanza. Daily Mirror : A budget for workers.
Daily Star : ‘Suicide threat celeb lured women.’ Financial Times : Healey puts energy reform at centre of Budget aimed at steadying nerves. Metro : Wife a ‘victim of sick fantasy.’ The Daily Telegraph : King: Slavery was a ‘great suffering.’ The Guardian : Healey targets cost of living crisis in budget for a ‘difficult moment.’ The Independent : Netanyahu’s fate in balance after historic election. The i Paper : Burnham to target rising energy bills in high-stakes first Budget.
The Times : Healey to cut energy bills by scrapping green levies. The Sun : Arise Sir Harry. LONDON CALLING WESTMINSTER WEATHER: Sunny spells with a high of 16C and low of 10C.
CHEERS! POLITICO has been named the 2026 Most Innovative Publisher by Digiday after bringing the POLITICO Pub to Labour conference. There’s also our fab global tech newsletter Decoded and our mobile app.
Congrats to our colleagues and thanks to readers for following us along the way. Full set of award winners here . HIRING: No. 10 is hiring five senior special advisers , focusing on the Rewiring the State agenda.
This includes a deputy to Caroline Simpson in No. 10 North. NOW READ: The i’s Kitty Donaldson has a great read on Burnham’s plan as he reopens the Brexit debate. “You can’t just dump a commitment to rejoin into a manifesto a month before an election, you have got to make the argument,” one government source tells her.
WEDNESDAY’S POD PICK: Pret CEO Pano Christou tells the Jimmy’s Jobs of the Future podcast about his rise from assistant manager to CEO — and defends Pret prices ... The Spectator’s Reality Check will be live at 12.15 p.m. with pollster Scarlett Maguire and former Treasury adviser James Nation reacting to the budget. CORRECTION: Miatta Fahnbulleh is not due to speak at an LSE event this evening, DESNZ confirmed.
WRITING PLAYBOOK PM: Emilio Casalicchio. WRITING PLAYBOOK THURSDAY MORNING: Sam Blewett. BIRTHDAYS: POLITICO’s Regional Director in Europe Jamil Anderlini ...
Culture, Media and Sport Committee Chair Caroline Dinenage ... Liverpool Walton MP Dan Carden ... former Amber Valley MP Nigel Mills ... former North West Leicestershire MP Andrew Bridgen ... retired Lib Dem peer and ‘‘gang of four’’ member Bill Rodgers ... retired crossbench peer Digby Jones ... broadcaster David Dimbleby ... Mail on Sunday columnist Peter Hitchens ...
Microsoft founder Bill Gates . PLAYBOOK COULDN’T HAPPEN WITHOUT: My editors Dan Bloom , Alex Spence and James Panichi , reporter Megan McElroy and producers Dean Southwell and Hugh Kapernaros . SUBSCRIBE to the POLITICO newsletter family: Brussels Playbook | Brussels Playbook Capitals | London Playbook | London Playbook PM | Playbook Paris | Berlin Playbook | Madrid Playbook | Sunday Crunch | EU Influence | London Influence | D.C.
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Source: politico.eu
