With thanks to Dehavilland, below is a summary of key announcements made in today's Budget (26 November 2025).
You can see the full Budget document here.
VODG's response to the Budget is here.
The Budget Process
Following The Chancellor's speech, there will be several days of debate in Parliament, where components of the speech are discussed.
There is always far more information made available in the Treasury documents, published here, and the Office for Budget Responsibility (OBR) updated economic and fiscal outlook, found here.
You may find the LGA's briefing on the budget of interest, as it considers the impact of announcements on local government.
Key announcements
Key take aways for VODG members
- The national minimum wage increase: for 18-21 years olds from £10 to £10.85 per hour and for those aged 21 and over to £12.72 an hour in April. The Living Wage will be £12.71 per hour.
- From 2028-29, the government will centrally fund the full cost of special educational needs and disabilities (SEND) provision, shifting the financial burden away from local authorities.
- From April 2027, the Government will increase the basic, higher, and additional rates of property income tax each by 2 percentage points to 22, 43, and 47% respectively.
- 250 new Neighbourhood Health Centres, with 100 delivered by 2030. The Minister has been clear, VCSE organisations and especially social care provision, are central to these plans.
- There are several changes planned for the Motability Scheme, detailed below.
- Free under-25 apprenticeships for small and medium size businesses.
- Increasing the state pension by 4.8%, committing to the triple lock.
- National Insurance will be charged on salary-sacrificed pension contributions above an annual £2,000 threshold from April 2029.
Health and social care
- An exemption of all payments in the infected blood scheme from inheritance tax
- All savings made in the NHS will be reinvested back into the service
- £300 million in investment in technology to improve patient services
- 250 new Neighbourhood Health Centres, with 100 delivered by 2030
Business, trade, and industry
- The national minimum wage will be increased again. For 18-21 years olds from £10 to £10.85 per hour. For those aged 21 and over, the NMW will increase to £12.72 an hour next April.
- Increases to the living wage from £12.21 to £12.71 per hour.
Housing and local government
- From April 2027, the Government will increase the basic, higher, and additional rates of property income tax each by 2 percentage points to 22, 43, and 47% respectively.
- From April 2028, a new high value council tax surcharge will apply to homes in England. This surcharge will be £2,500 for a property in the lowest £2 million to £2.5 million band, rising to £7,500 for a property valued in the highest band of £5 million or more. The Government will consult on deferral options.
- After listening to representations from the housebuilding industry, the Government will not proceed with plans to equalise the rates of Landfill Tax.
- The Chancellor confirmed that the Government would act to ensure that the gap between the two Landfill Tax rates did not increase further.
Education
- A £5 million commitment to secondary school libraries.
- A £18 million commitment for playgrounds across England.
- From 2028-29, the government will centrally fund the full cost of special educational needs and disabilities (SEND) provision, shifting the financial burden away from local authorities.
Employment and welfare
- 15,000 people are expected to get back to work due to changes to universal credit.
- Alan Milburn to review the increasing number of young people out of work or education
- There are several changes planned for the Motability Scheme.
- VAT relief on upfront Advance Payments will be removed for all new Motability leases from July 2026. From then on, these payments will be subject to the standard 20% VAT rate. Wheelchair Accessible Vehicles (WAVs) will remain exempt.
- A number of luxury vehicles have been removed from the Motability Scheme.
- The annual mileage cap will be reduced from the current 20,000 miles and breakdown cover for overseas travel will no longer be included as part of the standard lease package.
- A levy Insurance Premium Tax (IPT) will apply to the all-inclusive insurance cover provided by the Motability Scheme.
- £820 million for the Youth Guarantee over the next three years.
- Free under-25 apprenticeships for small and medium size businesses.
- The full abolition of the two-child benefit cap from April.
- Increasing the state pension by 4.8%, committing to the triple lock.
Financial services
- Extension of the existing freezes to personal tax thresholds for another three years until 2030-31.
- National Insurance will be charged on salary-sacrificed pension contributions above an annual £2,000 threshold from April 2029.
- Keep the £20,000 Isa allowance but designate £8,000 of it exclusively for investment. Over 65s will retain the full cash allowance of £20,000.
- The Government will index for inflation on pensions accrued before 1997 in the Pension Protection Fund and the Financial Assurance Scheme.
- Abolish access to Class 2 Voluntary National Insurance Contributions for people living abroad increasing the time people have to live or work in Britain to 10 years and increasing the contributions they must pay.
- Tax rates on property, savings and dividend income will rise by two percentage points
- Inheritance Tax changes to allow the transfer of 100% relief allowances between spouses.
- Reduction of relief from 100% to 50% on Capital Gains Tax on business sales made to Employee Ownership Trusts.
Culture, media and sport
- Remote gaming duty increased from 21% to 40%.
- Online betting duty increased from 15% to 25%.
- No changes to the taxes on in-person gambling or horse racing.
- Abolition of bingo duty from April 2026.
Tech and digital
- Eligibility for Enterprise Management Incentive schemes will be widened to improve environment for scale-up.
- Wales will host two AI Growth Zones.
- Tax thresholds are being frozen for another three years from 2028.
- Remote gaming duty will be increased from 21% to 40%.
Transport
- The 5p cut in fuel duty will be retained until September 2026.
- Introduction of new rules to mandate petrol forecourts to share real time price rises through a new fuel finder. Expected to save the average household £40 year.
- From April 2028 drivers of battery electric cars will see a 3p per mile tax and 1.5p per mile for plug-in hybrids, with the charge to then rise annually with inflation.
- Increasing threshold for the expensive car supplement on EVs to £50,000.
- £1.3 billion in additional funding for the electric car grant and extending it to 2030 and delaying changes to the employee car ownership scheme.
- Additional £200 million to accelerate the EV charger rollout.
- 100% business rates relief for EV charge points for the next decade.
Defence and international development
- 2.6% of GDP to be spent on defence by April 2027.
- The Government is “freezing Russian assets”.
Energy and environment
- The Chancellor welcomed John Fingleton’s report on the nuclear sector and set out plans to deliver his recommendations within three months.
- Reiterated the development of the UK’s first small modular reactors with Rolls-Royce at Wylfa.
- Committed £14 million for low-carbon technologies at Grangemouth.
- Said the Government are investing in nuclear, renewables and insulation.
- Axed the ECO scheme and removed other legacy costs from bills.
- Said this would cut £150 from the average household energy bill from April 2026.