Overview

• In her first clear acknowledgment, the chancellor said she is considering both tax measures and spending reductions for the Autumn Budget.
• Independent estimates put the fiscal gap at roughly £30bn, with some projections nearer £50bn, reflecting an OBR productivity downgrade, higher borrowing costs and dropped welfare savings.
• Reeves said the OBR had overestimated productivity and cited austerity, Brexit and the Truss mini‑budget as factors weighing on growth and revenues.
• She reiterated that relaxing fiscal rules is not an option and pledged to ensure day‑to‑day spending is covered by tax receipts by the end of the decade.
• The IMF now expects UK inflation to be the highest in the G7 in 2025–26, while the British Chambers of Commerce urged the government to avoid further business tax hikes and called the Budget a make‑or‑break moment for firms.