Autumn Budget 2026: Can the new cast support growth?

By Clemency Lion, Director of Research, Policy and Communications at ukactive

When the Chancellor takes his place at the despatch box next Wednesday (28 October), the question on everyone’s lips will be this: can John Healey, unlike his predecessors, manage to deliver a Budget that simultaneously tackles the cost-of-living crisis, relieves financial pressures on businesses and gets the cogs of economic growth turning again, all in the face of continuing geopolitical instability and burgeoning national debt?

People and businesses up and down the country have been feeling the increasing financial pressures, so there are strong demands. But with the economic outlook remaining bleak, it feels an impossible task.

The new Government under PM Andy Burnham does at least seem to be keen to put its foot on the gas and have an impact, which is a breath of fresh air following Keir Starmer’s approach. There have already been a number of policy initiatives announced since the latest Cabinet took up their seats around the table, in addition to pressure being put on various departments to get long-running work over the line, such as the recently published guidance for businesses on implementing the Digital Markets, Competition and Consumers Act, and the High Streets Strategy.

Reasons for optimism

So, what can we expect from Wednesday? There has been a lot of speculation in the press and within political circles about what the Chancellor will use his Budget to announce. This is commonplace ahead of a fiscal event, but what makes this occasion slightly different is that most of the rumours have not come from Government leaks, but rather from scheduled announcements and interviews with the Chancellor himself.

In an interview for The Times this week, the still relatively new Chancellor acknowledged that recent legislative and regulatory changes, price inflation and taxation had put businesses under “a lot of pressure” and indicated that he would focus his first Budget on addressing this. The release of the interview was quickly followed by several announcements to cut the red tape burdening businesses, which the Treasury claims will save a collective £800m in administrative and tariff costs per year.

It certainly feels like moves are being made in an attempt to win back the confidence of the business community, but to really shift the dial, we will need to see some fiscal initiatives that will go some way to relieving the financial burden on businesses, not just the regulatory one.

Of note for the physical activity sector, it has been suggested that there may be measures introduced to cut the cost of hiring under-25s. As a high employer of 16–24-year-olds, and a sector significantly impacted by the increases to employer NICs at the last Budget, this would be a welcome move and allow the sector to play its important role in tackling the youth unemployment crisis the country currently faces.

A couple of ways this could be implemented have been floated in policy papers from industry bodies – including in ukactive’s Budget submission – and in the press. One option put to the Treasury is to extend relief on NICs from those employees under 21 to all employees under 25.

Alternatively, the Government has been considering proposals for an overall reduction in employer NICs and an increase in the secondary threshold (the point at which employers start paying) from £5,000 to £6,000 per annum. This would benefit all employees, but the increase in the secondary threshold would be more likely to benefit younger employees.

There has also been talk in the press of cuts to business rates for ‘high street shops’, but the details surrounding this remain unclear.

Bank of online marketplace

This all sounds at least moderately positive, but but there remain questions on how these pledges will fit in with the Government’s own fiscal rules. To keep national debt under control, this will need to be a Budget of trade-offs, unless there are any big tax-hiking announcements brewing behind the Treasury doors. Aside from forcing online marketplaces to collect VAT, which it is estimated will raise £1bn to fund cuts to business rates, it is not yet clear what other tax rises or trade-offs might be on the table.

With positive noises on cuts to the cost of doing business, but uncertainty about how to fund it, overall, there remains a sense of unease about what to expect next week. We may find ourselves reflecting that we should be careful what we wish for. If the Government is serious about returning to economic growth, the voice of our businesses will have to be heard.

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