Chancellor Rachel Reeves has said she is still meeting her fiscal rule to deliver a current balance within five years, with day-to-day Government spending funded by tax receipts.
According to the latest forecasts, the headroom to achieve a current balance remains £9.9bn. Without the new measures, Reeves said the UK would be facing a £4.1bn deficit.
The figures show the deficit is now higher than previously forecast for the next two financial years, with smaller surpluses expected in the two years after that. The updated forecasts, compared with the projections made in October’s budget, are:
- 2025-26: A deficit of £36.1bn, up from £26.2bn forecast in October
- 2026-27: A deficit of £13.4bn, up from £5.2bn
- 2027-28: A surplus of £6bn, down from £10.9bn
- 2028-29: A surplus of £7.1bn, down from £9.3bn
- 2029-30: A surplus of £9.9bn, unchanged
