Spring Statement 2025: A quick look at the headlines
April 2025
Spring Statement 2025: A quick look at the headlines
April 2025
At the end of March 2025, Chancellor Rachel Reeves set out plans for the UK economy during her Spring Statement in the House of Commons.
The main discussion points included economic forecasts from the Office for Budget Responsibility (OBR), welfare changes, increased spending on defence and overseas aid, and targets to reduce the administrative costs of government departments by 15% by 2030.
Here’s a quick summary of some of the announcements:
- The predicted economic growth for this year has been downgraded from 2% to 1%. But, for the next four years, estimated growth has been upgraded – 1.9% next year, 1.8% in 2027, 1.7% in 2028 and 1.8% in 2029.
- Inflation is forecast to average 3.2% this year, up from 2.6% in a previous forecast. It’s predicted to fall back to 2.1% in 2026 and hit the government's 2% target in 2027.
- Welfare spending will fall because of a reduced Gross Domestic Product (GDP) share. There will be a stricter eligibility test for personal independence payments (PIPs) from November 2026; the standard allowance for Universal Credit will rise by £14 a week by 2030; and while health-related Universal Credit for new claimants will now not rise with inflation until after 2030, existing claimants health-related payments will be frozen at £97 per week until 2030.
- Real household disposable income will grow this year, potentially at twice the rate expected in the 2024 Autumn Statement. This growth is predicted to slow sharply in 2027/28, and it’s hoped this will pick up again in from 2028 with the freeze on Income Tax thresholds ending and real wage growth increases.
- An extra £1bn is due to be raised by cracking down further on tax evasion, with investment in the HMRC's capacity to crack down on tax avoidance.
- Housebuilding in the UK expected to reach a 40-year high, hitting 305,000 homes a year by the end of the forecast period.
If you'd like to find out more about everything that was announced during the Spring Statement, you can read the full report below.
Information correct at the time of publishing.
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