Healey's Budget on 28 October: pressures on the Chancellor and the stakes for London

Mixed · 2Chancellor John Healey is due to deliver the Budget on Wednesday 28 October 2026, and two previews published on 26 October describe a difficult backdrop. 1 2 Centre · 1The Evening Standard says inflation, which it links to the war in Iran, rose to 3.5% in September, and that the Institute for Fiscal Studies has warned the Chancellor must raise taxes, cut welfare, or do a combination of the two, worth £35 billion, to avoid cutting public service budgets. 1 Right · 1City A.M. says Healey must balance the expectations of businesses, traders, backbenchers and voters, and has promised each of them "breathing space". 2

Right · 1On jobs, City A.M. reports youth unemployment above 16 per cent for the first time in 11 years, with business groups blaming taxes and new employment regulations. It cites EY as saying a faster fall in unemployment than currently expected could bring a £40bn windfall to the public finances. 2 Mixed · 2Both pieces highlight public debt: City A.M. says the Office for National Statistics reported gross debt took six years to rise from £2 trillion to £3 trillion, and the Evening Standard calls the £3 trillion debt a "stratospheric" figure that earlier Chancellors failed to tackle. 2 1 Right · 1City A.M. says living standards are under pressure since the Iran war, with City economists calling it "extremely likely" that workers on average would take a real pay cut, and that analysts disagree about what is driving faster GDP growth. It reports that City forecasters surveyed by the Treasury expect growth of 1.1 to 1.4 per cent next year. 2

Centre · 1The Evening Standard's commentary centres on London, describing it as the country's economic engine. It says Londoners each pay at least £5,000 more on average into Treasury coffers than the city receives in spending, and that London and the South East are the only net contributors. 1 Centre · 1The Standard reports that Healey appears set to raise taxes rather than cut benefits. It says City banks are braced for a new £2 billion-a-year tax, that capital gains tax is not expected to rise, that the "mansion tax" threshold is not expected to fall from £2 million to £1.5 million, and that Healey is set to back Sadiq Khan's plan to open Stratford International for cross-Channel rail. It adds that the scale of the tax hit on London will only be known in the hours and days after publication. 1 Mixed · 2Both pieces set Healey against predecessor Rachel Reeves. The Standard says Healey is wary of repeating her mistakes, including a £20 billion rise in employer National Insurance, and quotes Healey saying they want to "back business in Britain making a profit". City A.M. says some ministers and backbenchers expected Reeves's successor to sound "a little more Labour" and that businesses feel bruised after the last two budgets. 1 2

Centre · 1The Standard also says the new Prime Minister, Andy Burnham, has lifted Labour's fortunes, that his plans for devolution, cost-of-living help, council homes and public control of utilities will need funding, and that Healey must find billions to lift defence spending to 3% of GDP by 2030. 1