Healey puts growth at centre of October budget as Labour faces spending test
The Chancellor says the budget will follow Labour’s fiscal rules, while leaving tax rises, welfare savings and spending cuts unresolved.
UK Chancellor John Healey has made economic growth the defining priority of his 28 October budget, while warning that Labour must be candid about controlling public spending.
Speaking to business leaders, Healey said the government would adhere to its target of balancing day-to-day spending with tax receipts by 2029–30. He argued that stronger growth was the most sustainable route to balancing the books as pressure on the public finances increases.
Healey declined to say whether taxes would rise, but reaffirmed Labour’s manifesto commitment not to increase taxes on working people. He also indicated that the government was seeking savings from the welfare bill through measures to reduce youth unemployment, without confirming specific reforms.
The government is awaiting Alan Milburn’s review of youth worklessness. Healey said helping young people move from benefits into work would carry both a fiscal and moral justification.
The budget is also expected to set out a roadmap for further devolution of tax and spending powers to regional mayors, potentially including the retention of business rates and a share of income tax. The extent and timing of any changes remain unclear.
Healey said higher public investment and reduced business red tape would support his growth agenda. His position comes amid concern over financial-market conditions and the wider pressure facing the government’s spending plans.
