Budget 2024

The first Budget from a Labour government since March 2010, and the first ever from a female Chancellor, proved to be the defining event that had been widely anticipated. From the moment in late July when Rachel Reeves unveiled her “£22 billion black hole” and announced means-testing for the winter fuel payment, it was clear her Budget premiere would be a challenging one for both the government and the governed.

In the event, the Chancellor delivered tax increases amounting to £41 billion by 2029/30. By far the largest element of this was the expected rise in employer’s national insurance contributions (NICs). The 1.2 percentage point rate increase, combined with a £4,100 cut in the secondary threshold will yield nearly £25 billion a year by 2028/29. At that level it more than counters the cost of the cuts to employee and self-employed NICs introduced by Jeremy Hunt.