“National debt hit £3 trillion for the first time in September, with public spending over-budget in the first half of the financial year. The rising cost of borrowing and inflation mean that servicing the debt is a significant concern for the Chancellor as he prepares for his first Budget next week.
“Pressures are mounting to provide additional support for rising energy bills, but the fiscal challenges to balance spending are becoming more acute, particularly as John Healey has less headroom than in the spring forecast.
“This is why the government needs to clarify the definition of current budget balance in the fiscal stability rule, given it is changing from a current budget surplus at this Budget. Ambiguity about what the new definition means for headroom could create a negative inflationary loop meaning further increases in borrowing costs and reduced investor confidence.”
ENDS
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* includes parent companies. Source: ICAEW member data March 2026, Interbrand, Best Global Brands 2025.
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