What to expect from John Healey’s first budget: who wins, who pays?

The chancellor has attempted to keep his budget under wraps. Photograph: Lauren Hurley/No 10 Downing Street View image in fullscreen The chancellor has attempted to keep his budget under wraps. Photograph: Lauren Hurley/No 10 Downing Street Explainer What to expect from John Healey’s first budget: who wins, who pays? Struggling households, new homebuyers and small shops stand to gain, while banks and online marketplaces could face higher levies John Healey will present his first budget on Wednesday, which will set the tone for Andy Burnham’s premiership. Despite the chancellor’s promises in the summer that the tax and spending event would not be beset , Rachel Reeves, both official and unofficial sources have indicated much of what Healey is likely to announce. Here’s what to expect: How much money is there? Healey will allocate about £1.42tn this year on day-to-day spending and public investment. About £100bn of this will go on debt interest after a rise in the interest rate the government pays to multidecade highs. Most of this increase can be blamed on the Gulf conflict launched , which has taken the oil price to above $110 a barrel and the price of gas to levels not seen since late 2022. Government borrowing in this financial year has fallen compared with 2025-26, but not , mainly owing to higher debt financing. Healey is spending about £1bn a month more than forecast. Those costs mean the buffer of £24bn built up in the last tax-raising budget is likely to have halved to £12bn, according to the Resolution Foundation thinktank. The Treasury would be more comfortable having this headroom at about £15bn, according to economists at ING. It’s a headache the chancellor could do without when he needs extra cash to fund cost of living measures, but also higher defence spending and the prime minister’s pet projects, such as devolution. What does he want to spend money on? The chancellor has promised to give consumers and businesses “breathing space” with a range of measures to help with soaring costs. Everyday fixes: This is what the Treasury calls its proposals to help struggling households. They include an extension of parental pay to more than 150,000 additional parents per year worth £388, including self-employed fathers and partners who have previously missed out. Healey will also end the carer’s allowance cliff-edge, so unpaid carers no longer lose more than their allowance once they hit their weekly earnings limit.