London Daily

Focus on the big picture.
Thursday, Jul 31, 2025

Budget: chancellor hints at looser purse strings for NHS and broadband

Budget: chancellor hints at looser purse strings for NHS and broadband

Rishi Sunak’s first budget on Wednesday is expected to offer measures to counter effects of coronavirus
Rishi Sunak, the chancellor, is expected to ease constraints on spending and borrowing in this week’s budget, as he sets out plans to help the economy withstand the impact of coronavirus.

Presenting his first budget on Wednesday, the new chancellor will make announcements including the confirmation of £5bn investment in faster broadband across the country -a policy from the Conservative manifesto.

Sunak, who is just a few weeks into the job, will also set out measures to help businesses survive the impact of coronavirus, such as delayed payments and bridging financing. He has promised to give the NHS “whatever it needs” to cope with the outbreak.

He is likely to deliver a much less radical budget than first planned as the government accepts the need for caution in the wake of the unfolding infection crisis. However, senior Tories are expecting Sunak at the least to announce a review of the government’s spending rules, or to find a way of making them easier to meet.

The rules, announced by his predecessor Sajid Javid at the election, commit the government to balancing the books on day-to-day spending by the middle of the parliament, and pledge that borrowing for infrastructure will not exceed 3% of GDP.

Sunak repeatedly refused to confirm that the rules would remain in place when pressed on his plans in interviews on Sunday. He suggested he could use a review to re-evaluate what is classed as investment spending. Even if the rules remain in place for now, they could be made easier to meet by changing the definition of investment spending to include more types of day-to-day spending, such as parts of spending on health, education and policing.

Pressed on the BBC’s The Andrew Marr Show on whether he would ditch Javid’s fiscal rules, he said: “I believe very much in the importance of fiscal responsibility, about responsible management of our public finances.

“And as I’ve made the point before, it’s because there’s been very strong management of public finances over the last 10 years by successive Conservative chancellors who have made some difficult decisions that means I can sit here today and say I will invest what it takes to get us through this, because our public finances are in a good spot,” he said.

No 10 is known to be keener than Javid was to loosen the public purse strings for spending in order to carry out its post-Brexit agenda. Sunak is much closer to Johnson’s team than Javid, who resigned as chancellor when the prime minister asked him to sack his advisers.

Tory MPs believe that most tax-raising measures floated by the government, such as a mansion tax, cutting pensions relief on higher earners and an imminent hike to fuel duty, have been dropped in recent weeks.

But the chancellor may opt to risk the ire of Tory colleagues by abolishing entrepreneurs’ relief, saving an estimated £2.6bn.

Key policies that are likely to be included are:

£5bn investment to roll out faster broadband across the UK by 2025 and a £1bn deal to boost 4G coverage, especially benefiting Scotland, Northern Ireland and Wales;
an increase in the National Insurance threshold, as promised in the Conservative manifesto;
a doubling of spending on flood defence schemes to £5bn, in light of the devastating floods in recent months;
plans to move some of the Treasury to a new northern base, with a fifth of the workforce eventually situated there.

On Sunday, the shadow chancellor, John McDonnell, warned that the likely amount of extra spending was “nowhere near the scale we need” to help the NHS, climate change and crisis in public services, as he branded Wednesday’s event “the most important budget since the second world war”.

It has already emerged that the national infrastructure strategy to invest £100bn in boosting the economy and tackling the climate crisis is expected to be delayed. The plan to improve transport connectivity and work towards achieving net-zero emissions by 2050 had been set to be published “alongside” the budget.

Economists have warned that Sunak will have little room for manoeuvre within his current fiscal rules without resorting to tax rises, much higher borrowing or more austerity. The Institute for Fiscal Studies said the government was on track to ramp up borrowing to about £63bn next year – £23bn more than the most recent official forecasts – amid a rapid increase in spending.

The IFS predicted that the Tories would probably break their election pledge to balance day-to-day spending with tax income by the middle of the current parliament if it continued on its current course. “It is not clear that the manifesto pledge to target current budget balance three years out would be met even under current policy,” the thinktank said.

Howard Archer, chief economic adviser to the EY ITEM Club, said on Sunday: “The chancellor may choose to flex the UK’s fiscal rules to provide more headroom to spend, but his flexibility on current spending seems limited and he will have to work carefully to maximise the benefits of the money he has at his disposal.”
Newsletter

Related Articles

0:00
0:00
Close
Former Judge Charged After Drunk Driving Crash Kills Comedian in Brazil
Jeff Bezos hasn’t paid a dollar in taxes for decades. He makes billions and pays $0 in taxes, LEGALLY
China Increases Use of Exit Bans Amid Rising U.S. Tensions
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Procter & Gamble to Raise U.S. Prices to Offset One‑Billion‑Dollar Tariff Cost
House Republicans Move to Defund OECD Over Global Tax Dispute
Botswana Seeks Controlling Stake in De Beers as Anglo American Prepares Exit
Trump Administration Proposes Repeal of Obama‑Era Endangerment Finding, Dismantling Regulatory Basis for CO₂ Emissions Limits
France Opens Criminal Investigation into X Over Algorithm Manipulation Allegations
A family has been arrested in the UK for displaying the British flag
Mel Gibson refuses to work with Robert De Niro, saying, "Keep that woke clown away from me."
Trump Steamrolls EU in Landmark Trade Win: US–EU Trade Deal Imposes 15% Tariff on European Imports
ChatGPT CEO Sam Altman says people share personal info with ChatGPT but don’t know chats can be used as court evidence in legal cases.
The British propaganda channel BBC News lies again.
Deputy attorney general's second day of meeting with Ghislaine Maxwell has concluded
Controversial March in Switzerland Features Men Dressed in Nazi Uniforms
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
Thai Civilian Death Toll Rises to 12 in Cambodian Cross-Border Attacks
TSUNAMI: Trump Just Crossed the Rubicon—And There’s No Turning Back
Over 120 Criminal Cases Dismissed in Boston Amid Public Defender Shortage
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
Trump Announces $550 Billion Japanese Investment and New Trade Agreements with Indonesia and the Philippines
US Treasury Secretary Calls for Institutional Review of Federal Reserve Amid AI‑Driven Growth Expectations
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Severe Flooding in South Korea Claims Lives Amid Ongoing Rescue Operations
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
CEO Resigns Amid Controversy Over Relationship with HR Executive
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
US Revokes Visas of Brazilian Corrupted Judges Amid Fake Bolsonaro Investigation
U.S. Congress Approves Rescissions Act Cutting Federal Funding for NPR and PBS
North Korea Restricts Foreign Tourist Access to New Seaside Resort
Brazil's Supreme Court Imposes Radical Restrictions on Former President Bolsonaro
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Judge Criticizes DOJ Over Secrecy in Dropping Charges Against Gang Leader
Apple Closes $16.5 Billion Tax Dispute With Ireland
Von der Leyen Faces Setback Over €2 Trillion EU Budget Proposal
UK and Germany Collaborate on Global Military Equipment Sales
Trump Plans Over 10% Tariffs on African and Caribbean Nations
Flying Taxi CEO Reclaims Billionaire Status After Stock Surge
Epstein Files Deepen Republican Party Divide
Zuckerberg Faces $8 Billion Privacy Lawsuit From Meta Shareholders
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
SpaceX Nears $400 Billion Valuation With New Share Sale
×