There will be winners and losers to gas standing charge reformpublished at 06:59 GMT

06:59 GMT

Faisal Islam
Economics editor, reporting from Downing Street

I’m in Downing Street, where it is barely light and already we have a first announcement made as markets prepare to open.

The chancellor has gone ahead with abolishing standing charges on gas bills, the average £108 fixed cost on annual bills after a review announced by Prime Minister Andy Burnham a week ago.

The change is a reform to what energy companies say is the most complained about feature of energy bills, and should help more energy efficiency and transition to electricity.

However, there will be winners and losers as the costs will be added to the unit price of gas, where the bill changes with increasing use.

The Treasury calculate that 60% of households will gain an average of £45 a year, with lower users gaining the most. Higher users, in the biggest houses for examples, will pay more than they currently do.

Image source, Getty Images

A bit more now on the government's announcement that it is scrapping standing charges on gas bills.

Under the current energy price cap, the gas standing charge is £108 a year on average, which customers pay regardless of what they use.

Ofgem - the UK energy regulator - will aim to deliver the removal of these charges "in 2027 or as soon as possible after", the Treasury says.

It also says that "targeted mitigation for a small number of households" will also be laid out.

Chancellor John Healey says this will "draw a line in the sand on an energy policy that has failed British billpayers for years".

The chancellor will remove standing charges from household gas bills for tens of millions of people, the government has announced.

Instead, fixed costs will be paid on the unit rate, with the government estimating that 60% of households will save an average of £45 per year.

Standing charges are fixed daily fees applied separately to gas and electricity bills, which customers pay regardless of usage.

Dearbail Jordan
Senior business and economics reporter

A lot has changed since the Spring Statement in March, the chancellor’s last major economic outing. The biggest difference is, of course, the chancellor. Back then, it was Rachel Reeves. Now, it’s John Healey.

The other significant development is the US-Israel war with Iran. When Reeves gave her Spring Statement on 3 March, the conflict was only four days’ old. It wasn’t even mentioned by the Office for Budget Responsibility (OBR) in its assessment of the government’s tax and spending plans published alongside the Spring Statement.

But the Iran war will be mentioned plenty today.

Higher oil and gas prices are already fuelling inflation and household energy bills are only heading one way.

The OBR will try to estimate how much inflation will rise – and how it will affect the government’s coffers - but it is tough to say with certainty since an agreement to end the war remains out of reach.

Image source, get

A rise in the minimum wage is expected to be announced in the Budget, but 18-to-20 year-olds are set to see lower increases than in previous years, the BBC understands.

Pay for younger workers will rise in line with the increase in minimum pay for employees aged 21 years and over.

However, the increase for younger workers is lower than that seen in the previous two years, when Labour raised the rate to meet a manifesto promise that it would remove "discriminatory age bands" with all adults entitled to the same minimum wage.

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Each year, the chancellor – the cabinet minister in charge of the government's finances – delivers a Budget statement to Parliament.

They outline the government's plans on tax, borrowing and spending on public services like healthcare and education.

The Treasury also publishes a report to accompany the Budget, detailing the measures and how much they will cost.

The independent Office for Budget Responsibility (OBR), which monitors government spending, also assess the plans.

In short, this is the moment the government explains how it's going to pay to keep everything running – and what that means in terms of taxes, moving money around and borrowing.

Dharshini David
Deputy economics editor

The chancellor has promised breathing space for households and businesses in the Budget, but higher inflation is a challenge for the government too.

Although it has meant the Treasury received more tax - wages rise in line with inflation so people may get dragged into higher income tax brackets - that has been outpaced by the amount the government is spending on public sector pay and debt interest repayments.

Financial markets are already anxious about Britain's debt levels.

To avoid those markets charging the government even more to borrow, John Healey needs to use this Budget to buy himself some time and convince investors he has a credible plan to reduce debt.

That means any help for households and businesses is likely to be very limited in scope and duration. To fund that, and maintain the public finances, he’s likely to raise taxes, albeit by a fraction of the £23bn unveiled by his predecessor Rachel Reeves last year.

Image source, Getty Images

We have seen some measures announced ahead of the Budget, including a series of small announcements on Tuesday that the government said would give families "breathing space" with the cost of living.

The announced policies include:

• Removing import taxes on some items - such as garlic, gherkins, plant-based drinks, jams, kerosene and fertilisers
• Making permanent a 55p per mile tax-free mileage rate for those driving up to 10,000 miles for work, with the rate rising from 25p per mile to 35p above that
• Allowing carers to earn more than the existing earnings limit without losing their entire allowance - known as the cliff-edge rule - replacing it with a taper mechanism instead
• Giving two weeks of paternity pay to self-employed fathers who have previously missed out on payments of up to £194 a week for the period
• And rolling out hundreds of additional Post Office drop boxes to make sending parcels easier

What can we expect from John Healey's first Budget?published at 06:26 GMT

06:26 GMT

Dearbail Jordan
Senior business and economics reporter

In just a few hours, John Healey will deliver his first Budget. The big question is what can we expect?

It is likely that the chancellor will announce targeted help on energy bills for low-income households. Fuel duty, scheduled to rise by 5p next year, will be frozen. First-time buyers will be offered a leg-up on the housing ladder with a loan scheme. And the minimum wage for young people will rise next year – but not by as much as it has in the past.

What we don’t know yet is how Healey will pay for it. UK debt is large and taxes are high. The chancellor doesn’t have a huge amount of wriggle room and it is not yet clear how much of an impact rising inflation will have on the government’s spending plans.

On the bright side, the UK economy is performing better than expected so far this year. The challenge for Healey is to keep that momentum going while not spooking financial markets and risk sending borrowing costs soaring.

It’s a tightrope. We’ll soon find out if Healey can walk it.

Budget needs to go some way towards delivering PM's promisespublished at 06:24 GMT

06:24 GMT

Chris Mason
Political editor

Two quotes from the chancellor and the prime minister get to the heart of this Budget.

"The money New Labour had in the 90s is simply not there now… Britain has it harder now," Chancellor John Healey said last month.

And from Andy Burnham, days before he became prime minister: "This change... is the most significant change moment in our politics for 40 years."

So what happens when the economic realities confront the political ambitions of this new government?

As Helen Miller, director of the Institute for Fiscal Studies (IFS), puts it: "We have a relatively new government with seemingly big ambitions but facing a long list of constraints.

"Some of those constraints… are self imposed, others are being worsened by global events, most noticeably war in the Middle East."

Image source, EPA

Let's be clear, plenty in Westminster in all parties will say that the amount of money around isn't everything – how well taxpayers' money is spent and where it is spent matters too.

And spending less and taxing less, plenty argue, should be a priority.

But in the bones of many in the Labour Party is an instinct that the government, the state, can and should be a vital agent in driving change and improvements in people's lives – a world-view grounded in a sense that governments should proudly step in, rather than one that believes they should get out of the way.

And how do you deliver a proudly proactive state, delivering for people in a noticeable way, when the tax burden is generationally high, the national debt is sky high, energy bills are rising and inflation is higher than expected?

In short: it is not easy.

Read Chris Mason's analysis in full here.

Image source, Getty Images

Budget day is the biggest fiscal event in the government's calendar. It's a jam-packed affair, with statements, meetings and reports galore. Here's what to expect:

• This morning, the day kicks off with a Cabinet meeting at No 10
• At 11:20 GMT, we get the red box moment, a time-honoured tradition that sees the chancellor pose for a photograph with the red leather Budget box outside No 11
• At 12:30, it's time for Chancellor John Healey to stand up in the House of Commons and present his Budget to MPs. His statement will follow the weekly session of Prime Minister's Questions and will last for around an hour
• At the same time, the Treasury will publish a more detailed report on the plans online
• At 13:30, leader of the Conservatives Kemi Badenoch will deliver her response
• MPs across the Commons will then have the chance to debate the Budget – a process that typically lasts four days – before the plans are formalised through a Finance Bill
• At around 14:30, we'll hear from the independent Office for Budget responsibility – which monitors government spending – in a press conference

Freya Scott-Turner
Live reporter

Image source, EPA/Shutterstock

What a difference a year makes. Budget day is here once again and a lot has changed since the last one.

We have a new PM in Andy Burnham, who this week marked 100 days in office. Alongside him, a new Chancellor, John Healey.

Healey has promised a tax and spending plan that "moves money and power out of Westminster". He also has multiple pressures to address – from the cost of living to funding defence, and stimulating economic growth.

He'll have to find a way of doing so without breaking Labour's manifesto pledges whilst also meeting the government's self-imposed fiscal rules.

All will become clearer at 12:30 GMT, when the chancellor delivers his statement to the House of Commons.

Stay with us for updates, analysis and reaction throughout the day.