| Fiscal headroom more than doubles to £21.7bn, giving government greater flexibility within its fiscal rules | Growth forecasts rise to 1.5% this year, with steady medium-term expectations supporting economic stability and resilience | Inflation expected to fall to 3.5% this year and 2.5% next year, aided by Budget measures |
Ms Reeves began her statement by acknowledging the Office for Budget Responsibility’s (OBR’s) technical error in releasing its Economic and Fiscal Outlook earlier than planned. The document’s accidental release effectively detailed the Budget’s key contents before the Chancellor stood at the dispatch box to deliver her statement, a move Ms Reeves described as “deeply disappointing.”
The Chancellor then confirmed that the Budget will see an expansion of the buffer for meeting the government’s fiscal targets, with the amount of headroom more than doubling from last year’s figure of £9.9bn to £21.7bn. During her speech, Ms Reeves also noted that the Budget kept “every single one” of Labour’s manifesto pledges on tax, with both her fiscal rules maintained without the need for “austerity” or “reckless borrowing.”
While the Chancellor noted that the OBR’s economic growth forecast for this year had been increased from 1.0% to 1.5%, growth is expected to be 1.4% in 2026, and 1.5% across each of the following four years. In terms of consumer prices, the Chancellor noted that OBR calculations show “inflation is coming down faster” and, “as a direct result of this Budget,” will be “a full 0.4 percentage points lower next year.” The OBR predict CPI inflation of 3.5% this year and 2.5% in 2026.
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All details are believed to be correct at the time of writing (26 November 2025)
