Healey seeks to steer UK through 'difficult moment' with low-key budget

Key Points:

• British finance minister John Healey is set to announce a cautious budget aimed at easing bond market pressure and providing Britain with "breathing space" amid inflation driven by the Iran war.
• The budget will include plans to increase regional mayors' control over tax revenues as part of Prime Minister Andy Burnham's devolution agenda, along with over £20 billion in support for AI, defence, and green energy investments by the early 2030s.
• Healey's approach is restrained due to rising borrowing costs and the memory of the 2022 bond market turmoil following unfunded tax cuts, with expectations of less than £10 billion in extra debt issuance this financial year.
• The government will introduce low-cost measures such as reducing business paperwork to save £800 million annually, removing fixed gas bill standing charges, and cutting tariffs on some imported goods to support voters without breaching fiscal targets.
• Larger policy shifts, including addressing inflation's impact on public spending and defence funding, are expected to wait for Burnham's forthcoming 10-year plan and a spending review in 2027.