HM Treasury is the government’s economic and finance ministry, maintaining control over public spending, setting the direction of the UK’s economic policy and working to achieve strong and sustainable economic growth.
This inquiry will examine quantitative tightening, including its impact on the economy and its fiscal costs. It will also investigate …
Oral Answers to Questions is a regularly scheduled appearance where the Secretary of State and junior minister will answer at the Dispatch Box questions from backbench MPs
Other Commons Chamber appearances can be:Westminster Hall debates are performed in response to backbench MPs or e-petitions asking for a Minister to address a detailed issue
Written Statements are made when a current event is not sufficiently significant to require an Oral Statement, but the House is required to be informed.
HM Treasury does not have Bills currently before Parliament
A Bill to impose duties on the Treasury and the Office for Budget Responsibility in respect of the announcement of fiscally significant measures.
This Bill received Royal Assent on 10th September 2024 and was enacted into law.
A Bill to authorise the use of resources for the year ending with 31 March 2025; to authorise both the issue of sums out of the Consolidated Fund and the application of income for that year; and to appropriate the supply authorised for that year by this Act and by the Supply and Appropriation (Anticipation and Adjustments) Act 2024.
This Bill received Royal Assent on 30th July 2024 and was enacted into law.
e-Petitions are administered by Parliament and allow members of the public to express support for a particular issue.
If an e-petition reaches 10,000 signatures the Government will issue a written response.
If an e-petition reaches 100,000 signatures the petition becomes eligible for a Parliamentary debate (usually Monday 4.30pm in Westminster Hall).
Commons Select Committees are a formally established cross-party group of backbench MPs tasked with holding a Government department to account.
At any time there will be number of ongoing investigations into the work of the Department, or issues which fall within the oversight of the Department. Witnesses can be summoned from within the Government and outside to assist in these inquiries.
Select Committee findings are reported to the Commons, printed, and published on the Parliament website. The government then usually has 60 days to reply to the committee's recommendations.
Since 5 July 2024, the Department has spent £9.7k on media training for members of the Ministerial team. No costs on voice training for Ministers have been incurred since the 5th July 2024.
The Valuation Office Agency (VOA) conducts analysis of changes in rateable value to prepare for regular revaluations. The VOA is currently working on a revaluation of all non-domestic properties, which will come into effect on 1 April 2026. The revaluation is not yet complete, and the VOA expect to publish draft valuations by the end of 2025. For the upcoming 2026 revaluation, as with other revaluations, the VOA is receiving ongoing representations from the airport sector.
As set out at Budget, the Government intends to introduce permanently lower tax rates for retail, hospitality, and leisure (RHL) properties, with rateable values below £500,000 from 2026-27. This permanent tax cut will ensure that they benefit from much-needed certainty and support. The Government intends to fund this by introducing a higher multiplier on all properties with a rateable value (RV) of £500,000 and above.
The Government will confirm the rates for the new multipliers at Budget 2025, taking account of the outcomes of the 2026 revaluation as well as the broader economic and fiscal context.
Tax policy and legislation is not subject to the Better Regulation Framework Guidance which requires an Impact Assessment to accompany policy decisions. Nevertheless, when the new multipliers are set at Budget 2025, the Treasury intends to publish analysis of the effects of the new multiplier arrangements.
The Valuation Office Agency (VOA) conducts analysis of changes in rateable value to prepare for regular revaluations. The VOA is currently working on a revaluation of all non-domestic properties, which will come into effect on 1 April 2026. The revaluation is not yet complete, and the VOA expect to publish draft valuations by the end of 2025. For the upcoming 2026 revaluation, as with other revaluations, the VOA is receiving ongoing representations from the airport sector.
As set out at Budget, the Government intends to introduce permanently lower tax rates for retail, hospitality, and leisure (RHL) properties, with rateable values below £500,000 from 2026-27. This permanent tax cut will ensure that they benefit from much-needed certainty and support. The Government intends to fund this by introducing a higher multiplier on all properties with a rateable value (RV) of £500,000 and above.
The Government will confirm the rates for the new multipliers at Budget 2025, taking account of the outcomes of the 2026 revaluation as well as the broader economic and fiscal context.
Tax policy and legislation is not subject to the Better Regulation Framework Guidance which requires an Impact Assessment to accompany policy decisions. Nevertheless, when the new multipliers are set at Budget 2025, the Treasury intends to publish analysis of the effects of the new multiplier arrangements.
HMRC does not hold the data requested relating to people added to and removed from PAYE. The PAYE population is made up of around 35 million individuals, and precise numbers change frequently as customers take up their first PAYE employment or pension, start new employments or pensions, and leave old ones. Increasing numbers of customers also take up secondary or additional employments or pensions, and have other income sources which may or may not be taxed through PAYE.
HMRC does not hold the data requested relating specifically to sole traders registering for Self Assessment. There are around 12.1 million taxpayers who are expected to submit Self Assessment tax returns by 31 January 2025. That population includes sole traders, some of whom will have commenced or ceased trading during the 2023/24 tax year.
HMRC does not hold the data requested relating to people added to and removed from PAYE. The PAYE population is made up of around 35 million individuals, and precise numbers change frequently as customers take up their first PAYE employment or pension, start new employments or pensions, and leave old ones. Increasing numbers of customers also take up secondary or additional employments or pensions, and have other income sources which may or may not be taxed through PAYE.
HMRC does not hold the data requested relating specifically to sole traders registering for Self Assessment. There are around 12.1 million taxpayers who are expected to submit Self Assessment tax returns by 31 January 2025. That population includes sole traders, some of whom will have commenced or ceased trading during the 2023/24 tax year.
The Government will provide support for departments and other public sector employers for additional Employer National Insurance Contributions costs. This funding will be allocated to departments, with the Barnett formula applying in the usual way. This is in line with the approach taken under the previous Government’s Health and Social Care Levy. Details of the funding set aside for 2025-26, including its allocation, will be published in due course.
Local authorities are responsible for arranging home to school transport for children with special educational needs, and deliver this through both in-house services and a range of external providers. As such, the Government does not hold central estimates of the impact that the increase in Employer National Insurance Contributions may have on the cost of home to school travel to local authorities. Officials engage regularly with local authorities to understand the challenges they face across the services they deliver.
Small Business Rate Relief (SBRR) provides 100% rate relief for eligible properties with rateable values below £12,000 with tapered relief available for eligible properties with rateable values between £12,000 and £15,000. Further details can be found at: https://www.gov.uk/apply-for-business-rate-relief/small-business-rate-relief
The government has no plans to withdraw SBRR. The discussion paper on business rates, published at Autumn Budget 2024, invites views on how it might best create a fairer business rates system that protects the high street, supports investment, and is fit for the 21st century.
The discussion paper invites views on incentivising investment and growth and specifically invites views on potential ways in which SBRR might be improved. The discussion paper is available at: https://assets.publishing.service.gov.uk/media/675197b95692dd4c0c8d1dac/Transforming_Business_Rates__2_.pdf
Any decisions on future tax policy will be announced by the Chancellor at a fiscal event.
At Autumn Budget 2024, the Government announced that it intends to introduce permanently lower tax rates for retail, hospitality, and leisure (RHL) properties, with rateable values below £500,000, from 2026-27. This permanent tax cut will ensure that they benefit from much-needed certainty and support. The Government intends to fund this by introducing a higher multiplier on all properties, including film studios, with a rateable value (RV) of £500,000 and above.
The Government has announced that it is proceeding with 40 per cent relief for eligible film studios in England on their gross business rates bills until March 2034. The costing was published at Spring Budget 2024 - .
Business rates bills are calculated by applying the relevant multiplier first and so film studios will receive 40 per cent relief on their total liability.
The Government will confirm the rates for the new multipliers at Budget 2025.
At Autumn Budget 2024, the Government announced that it intends to introduce permanently lower tax rates for retail, hospitality, and leisure (RHL) properties, with rateable values below £500,000, from 2026-27. This permanent tax cut will ensure that they benefit from much-needed certainty and support. The Government intends to fund this by introducing a higher multiplier on all properties, including film studios, with a rateable value (RV) of £500,000 and above.
The Government has announced that it is proceeding with 40 per cent relief for eligible film studios in England on their gross business rates bills until March 2034. The costing was published at Spring Budget 2024 - .
Business rates bills are calculated by applying the relevant multiplier first and so film studios will receive 40 per cent relief on their total liability.
The Government will confirm the rates for the new multipliers at Budget 2025.
At Autumn Budget 2024, the Government announced that it intends to introduce permanently lower tax rates for retail, hospitality, and leisure (RHL) properties, with rateable values below £500,000, from 2026-27. This permanent tax cut will ensure that they benefit from much-needed certainty and support. The Government intends to fund this by introducing a higher multiplier on all properties, including film studios, with a rateable value (RV) of £500,000 and above.
The Government has announced that it is proceeding with 40 per cent relief for eligible film studios in England on their gross business rates bills until March 2034. The costing was published at Spring Budget 2024 - .
Business rates bills are calculated by applying the relevant multiplier first and so film studios will receive 40 per cent relief on their total liability.
The Government will confirm the rates for the new multipliers at Budget 2025.
For individuals with income between £100,000-£125,140, the income tax Personal Allowance is tapered by £1 for every £2 earned above this limit, until it has been completely withdrawn at £125,140. Taxpayers with incomes within the taper band face a higher effective marginal tax rate of 60%, compared to 40% below £100,000 and 45% above £125, 140. Income tax rates and thresholds are devolved in Scotland, so marginal rates within the taper band will vary based on the registered address of the taxpayer.
For individuals with income between £100,000-£125,140, the income tax Personal Allowance is tapered by £1 for every £2 earned above this limit, until it has been completely withdrawn at £125,140. Taxpayers with incomes within the taper band face a higher effective marginal tax rate of 60%, compared to 40% below £100,000 and 45% above £125, 140. Income tax rates and thresholds are devolved in Scotland, so marginal rates within the taper band will vary based on the registered address of the taxpayer.
Wheelchair accessible vehicles (WAVs) are subject to a zero rate of VAT when purchased by a disabled person for their personal use, or by a charity that will make the vehicle available to disabled people.
Although taxis provide transportation services to disabled customers, they are not charities and not all their customers are wheelchair users. Therefore, this VAT relief does to extend to taxis that are WAVs.
However, if a taxi driver is VAT registered, they are eligible to reclaim the VAT paid on their vehicle.
The government is committed to maintaining an open and constructive dialogue with the oil and gas sector to support our energy security and ensure the sector plays its role in our clean energy ambitions.
In line with this I will chair the next Oil and Gas Fiscal Forum in the first quarter of next year. The date and location of the forum has not yet been confirmed.
To deliver our manifesto pledge, from 2026-27, the Government intends to protect the high street by introducing permanently lower tax rates for retail, hospitality, and leisure (RHL) properties with Rateable Values below £500,000. This permanent tax cut will ensure that RHL properties benefit from much-needed certainty and support.
This tax cut must be sustainably funded, and so the Government intends to introduce a higher rate on the most valuable properties from 2026-27, that is, those with a Rateable Value of £500,000 and above. These represent less than one per cent of all properties, but include the majority of large distribution warehouses, including those used by online giants.
The Valuation Office Agency publishes a breakdown of the Non-domestic Rating Stock of Properties by Sector, Sub-Sector and Special Category (SCat). This includes a ‘large distribution warehouses’ category, which is SCat 151.
We do not hold the information requested. Neither schemes nor individuals are required to provide HMRC with this information.
Since 1 January 2021 overseas sellers, or online marketplaces where they facilitate the sale, are required to be registered and account for VAT for supplies of low value imports of £135 or less. Where an overseas seller sells goods located in the UK at the point of sale via an online marketplace, the online marketplace is liable for the VAT for goods of any value.
The changes were introduced to ensure a level playing field for UK high street and online retailers, ensure the continued flow of goods at the border and improve compliance.
Certified analysis by the Office for Budget Responsibility (OBR) estimates the changes will raise £1.8 billion per annum by 2026-27.
The Government keeps all taxes under review as part of the policy making process.
The longstanding rules already mean agricultural property relief is currently only available if the property includes agricultural land that is occupied for agricultural purposes. It may be occupied by the owners of the land or others, such as a tenant farmer. More information on the qualifying uses of land can be found at www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm24061.
The rules governing the Sovereign Grant are set out in the Sovereign Grant Act 2011. This Act requires a review following every five-year period to ensure the percentage of Crown Estate profits used in the calculation of the Grant remains appropriate.
In addition, any unspent surplus from the Sovereign Grant goes into a reserve fund. If this reserve fund goes above 50 per cent of annual expenditure, the level of the Sovereign Grant can be reduced, requiring the Household to draw down this reserve rather than receive excessive additional funding.
The Government published information about the reforms to agricultural property relief and business property relief at www.gov.uk/government/publications/agricultural-property-relief-and-business-property-relief-reforms.
It is expected that up to around 2,000 estates will be affected by the changes to APR and BPR in 2026-27, with around half of those being claims that involve AIM shares. Almost three-quarters of estates claiming agricultural property relief (or those claiming agricultural property relief and business property relief together) are expected to be unaffected by these reforms.
In accordance with standard practice, a tax information and impact note will be published alongside the draft legislation before the relevant Finance Bill.
This Government is committed to keeping taxes as low as possible for working people and pensioners while ensuring fiscal responsibility, which is why it is not extending the freeze on personal tax thresholds that was implemented by the previous Government and is instead allowing them to rise with inflation from April 2028.
The Government provides additional support for both pensioners and low-income households. At the Autumn Budget, the Government announced that the basic and new State Pension will increase by 4.1% from April 2025. This means those on a full new State Pension will be getting an additional £470 a year. The Government also announced a 6.7% increase to the National Living Wage (NLW) from April 2025. This represents an increase of £1,400 to the annual earnings of a full-time worker on the NLW and is expected to benefit over 3 million low-paid workers.
As part of its official statistics, the Valuation Office Agency publishes the number of hereditaments by special category code under the shops sub-sector for England and Wales for the past 10 years. This can be found under the stock of non-domestic properties collection here: www.gov.uk/government/collections/non-domestic-rating-stock-of-properties-collection
For each year from 2019 onwards, the table ‘Stock Scat’ shows the data as at 31 March each year. Prior to 2019, the data is shown within the ‘NDR Stock of Properties’ tables.
The Government published information about the reforms to agricultural property relief and business property relief at www.gov.uk/government/publications/agricultural-property-relief-and-business-property-relief-reforms.
It is expected that up to around 2,000 estates will be affected by the changes to APR and BPR in 2026-27, with around half of those being claims that involve AIM shares. Almost three-quarters of estates claiming agricultural property relief (or those claiming agricultural property relief and business property relief together) are expected to be unaffected by these reforms.
In accordance with standard practice, a tax information and impact note will be published alongside the draft legislation before the relevant Finance Bill.
Vehicle Excise Duty (VED) is a tax on car ownership from which electric vehicles are currently exempt. As announced by the previous Government at Autumn Statement 2022, from April 2025, electric and hybrid cars, vans and motorcycles will begin to pay VED alongside petrol and diesel vehicles.
The Policy Costings document published alongside Autumn Statement 2022 when the change was announced estimates the impact on electric vehicle take-up to be “negligible”.
The Government is committed to supporting the transition to Zero Emission Vehicles and announced a number of measures at Budget to support EV take-up. VED First Year Rates are changing from 2025-26, with higher rates for polluting hybrid, petrol and diesel vehicles. In addition the Government maintained incentives for the purchase of EVs within the Company Car Tax and Salary Sacrifice regimes, and extended the 100% First Year Allowances for businesses purchasing zero emission cars and installing chargepoint infrastructure.
Revenue from motoring taxes helps ensure we can continue to fund the vital public services and infrastructure that people and families across the UK expect.
HMRC estimated the 2023-24 Child Benefit Error and Fraud (E&F) rate to be 1.6% (£200m) of total Child Benefit expenditure.
Child Benefit has strong pre-award controls. The emphasis of HMRC’s compliance strategy remains on unreported changes in circumstance including improving detection through further data acquisition.
As part of this strategy the government announced in Autumn Statement 2024 that it is investing in 180 new counter-fraud staff to increase HMRC’s capabilities to better tackle fraud and error in Child Benefit and Tax-Free Childcare. This is expected to deliver a net saving of £355 million from 2025-26 to 2029-30.
As with all taxes and allowances, the Government keeps flat rate expenses, including Overseas Scale Rates, under review.
The Government is working to support people and improve living standards for everyone across the country. As part of this, the Government committed to making no increase in employee National Insurance, Income Tax or VAT as we want to keep taxes as low as possible for working people. The Government has also put growth as its number one mission, which will help families by boosting wages and putting more money in people’s pockets.
The Budget announced a £240 million Get Britain Working package to help people into work which will help to tackle the root causes of economic inactivity and to get those who can work, off benefits and into good employment. Further details have been set out in the Get Britain Working White Paper, published on 26 November 2024.
On 1 April 2025, the new National Living Wage and National Minimum Wage rates will come into force, expecting to benefit over 3 million eligible workers. For a full-time worker on NLW, the 6.7% increase of the rate to £12.21 per hour will provide a £1,400 increase to their annual earnings. These increases will ensure that the lowest-paid workers are supported and marks a step towards the government delivering a genuine living wage for all adults.
In addition, the Government is also supporting those on low incomes through continuing the Household Support Fund, increasing the Carers’ Allowance weekly earnings limit by nearly 30% from April 2025, and creating a new Fair Repayment Rate ensuring 1.2 million households claiming Universal Credit are on average better off by £420 per year, by capping the amount of debt deductions at 15% of the standard allowance.
On mental health, the Government has continued to expand access to mental health support to address the high levels of demand since the pandemic ended. This has included increasing the mental health workforce, treating more people through NHS Talking Therapies and improving urgent and emergency mental health care though new crisis houses and alternatives to A&E as well as making support available to those experiencing a crisis through the new ‘mental health option’ on 111.
Income and gains in relation to cryptoassets are currently reported in the same sections with other incomes and gains on the Self-Assessment return pages, and therefore those amounts are not separately identifiable from the data collected via Self-Assessment.
From the tax year ending 2025, changes will be introduced to the Capital Gains pages of the Self-Assessment forms requiring amounts in respect of cryptoassets to be identified separately.
Certain properties are exempt from business rates. Details on exemptions can be found at: https://www.gov.uk/apply-for-business-rate-relief/exempt-properties.
Any decisions on future tax policy will be announced by the Chancellor at a fiscal event.
Around 250,000 employers will see their Secondary Class 1 NICs liability decrease and around 820,000 employers will see no change.
The Government published information about the reforms to agricultural property relief and business property relief at www.gov.uk/government/publications/agricultural-property-relief-and-business-property-relief-reforms.
It is expected that up to around 2,000 estates will be affected by the changes to APR and BPR in 2026-27, with around half of those being claims that involve AIM shares. Almost three-quarters of estates claiming agricultural property relief (or those claiming agricultural property relief and business property relief together) are expected to be unaffected by these reforms.
In accordance with standard practice, a tax information and impact note will be published alongside the draft legislation before the relevant Finance Bill.
The Government recognises that cash continues to be used by millions of people across the UK, including those in vulnerable groups, and is committed to protecting access to cash for individuals and businesses.
The most recent data from the Financial Conduct Authority shows that 97 per cent of people in urban areas live within 1 mile of a free-to-use cash access point offering deposits. In rural areas, 98 percent of people live within 3 miles of a free-to-use cash access point offering deposits.
The Financial Conduct Authority (FCA) has recently assumed regulatory responsibility for access to cash, and its rules came into effect on 18 September 2024. These rules require the UK’s largest banks and building societies to assess the impact of a closure of a relevant cash withdrawal or deposit facility and put in place a new service if necessary. Where a branch closure is announced and it is deemed that this closure will impact free access to cash, the branch cannot close until a replacement service is operational and any gap in provision has been filled.
Where a consumer, or anyone with a strong connection to a local area, feels access to cash in their community is insufficient, they can submit a request for a cash access assessment. Further information about submitting a cash access request can be found at the following link: https://www.link.co.uk/helping-you-access-cash/request-access-to-cash
The Government ran a technical consultation on the VAT policy for seven weeks from 29 July to 15 September. During the consultation period, my officials and I also held a series of meetings with stakeholders to complement written responses. This included written submissions from Steiner Schools.
Following that consultation the Government made changes to the treatment of nursery classes, so that those attached to private schools will continue to be exempt from VAT as long as they are wholly (or almost wholly), rather than completely, composed of children under compulsory school age who wouldn’t be expected to turn compulsory school age that year.
Classes where the vast majority of children are below compulsory school age will remain exempt from VAT. Where mixed classes have a high proportion of children over compulsory school age the Government believes it is fair to treat these classes the same way entire classes of children over compulsory school age are treated. This means that classes like “kindergarten classes” in Steiner schools will be within scope of this policy.
The Duchies of Cornwall and Lancaster are private estates, and neither Duchy manages public money. The government has a limited number of functions in relation to their administration, prescribed by Acts of Parliament.
The Department spent c.£56.5k on new furniture, fittings, and other refurbishments between 4 July 2022 and 4 July 2024. This expenditure includes costs for new office furniture, the maintenance of antique furniture and fittings.
Information on Lifetime ISAs can be found in HMRC’s Annual Savings Statistics, available here:
https://www.gov.uk/government/collections/annual-savings-statistics
I refer the Honourable Member to the PQ referenced 12250 published on 11th November 2024 at: https://questions-statements.parliament.uk/written-questions/detail/2024-11-01/12250.
The Chancellor also recently wrote to the Chair of the Treasury Select Committee on this issue, and her letter may be of interest: https://committees.parliament.uk/publications/45691/documents/226235/default/
The aim of the UK CBAM is to ensure imported products are subject to a carbon price comparable to that incurred by UK production, mitigating the risk of carbon leakage. By its very nature, a CBAM can only apply to imported goods, so it cannot mitigate any risk of carbon leakage in export markets.
The government will continue to consider whether there is a role for existing or future carbon leakage policies to address the risk associated with exports. Any policies applied to exported products would need to be compliant with the UK’s WTO obligations and our commitment to free and open trade.
A more detailed assessment of CBAM impacts on the economy and carbon leakage will be provided before legislation is introduced.
The Valuation Office Agency (VOA) holds information about pubs to assess them for non-domestic rating purposes, one of the VOA’s statutory duties.
The vast majority of the information held is sent by occupiers of pubs following a statutory request for information. The form sets out the information requested and can be found here: https://www.gov.uk/government/publications/vo-6010-request-for-rental-information-public-houses.
In some cases, the VOA may hold other records relating to the property, including the age, area, and information about heating, car parking and any modernisation carried out.
The Valuation Office Agency publishes this data as part of its official statistics on the stock of non-domestic properties:
www.gov.uk/government/statistics/non-domestic-rating-stock-of-properties-2024.
The mean rateable value for municipal swimming pools in England and Wales are published on rows 229 and 238 under column E in the Stock Scat, 2024 spreadsheet.
Please note, figures show the mean rateable value in thousands of pounds. |
Treasury ministers have meetings with a wide variety of organisations in the public and private sectors as part of the process of policy development and delivery.
Details of ministerial meetings with external organisations on departmental business are published on a quarterly basis and are available at the link here: https://www.gov.uk/government/collections/hmt-ministers-meetings-hospitality-gifts-and-overseas-travel
The Government does not hold bank branch closure data. However, according to consumer website Which?, Aldershot constituency lost just under 60% of its branch network between January 2015 and November 2024, and has eight branches remaining.
Guidance from the FCA sets out its expectation of firms when they are deciding to reduce their physical branches or the number of free-to-use ATMs. Firms are expected to carefully consider the impact of planned branch closures on their customers’ everyday banking and cash access needs, and put in place alternatives, where this is reasonable.
The Government understands the importance of face-to-face banking to communities and high streets in Aldershot and across the UK, and is committed to championing sufficient access for all as a priority. This is why the Government is working closely with banks to roll out 350 banking hubs, which will provide individuals and businesses up and down the country with critical cash and banking services.
The Government does not hold bank branch closure data. However, according to consumer website Which?, Aldershot constituency lost just under 60% of its branch network between January 2015 and November 2024, and has eight branches remaining.
Guidance from the FCA sets out its expectation of firms when they are deciding to reduce their physical branches or the number of free-to-use ATMs. Firms are expected to carefully consider the impact of planned branch closures on their customers’ everyday banking and cash access needs, and put in place alternatives, where this is reasonable.
The Government understands the importance of face-to-face banking to communities and high streets in Aldershot and across the UK, and is committed to championing sufficient access for all as a priority. This is why the Government is working closely with banks to roll out 350 banking hubs, which will provide individuals and businesses up and down the country with critical cash and banking services.
The Government closely monitors levels of mortgage arrears, which remain low by historical standards. UK Finance has predicted mortgage arrears will fall in 2025.
There are significant measures in place to protect vulnerable mortgage borrowers. Financial Conduct Authority (FCA) rules require lenders to engage individually with their customers who are struggling or who are worried about their payments, and the Mortgage Charter also remains in place providing additional flexibilities to help customers manage their mortgage payments over a short period.
The Government closely monitors levels of mortgage arrears, which remain low by historical standards. UK Finance has predicted mortgage arrears will fall in 2025.
There are significant measures in place to protect vulnerable mortgage borrowers. Financial Conduct Authority (FCA) rules require lenders to engage individually with their customers who are struggling or who are worried about their payments, and the Mortgage Charter also remains in place providing additional flexibilities to help customers manage their mortgage payments over a short period.
The Government understands the importance of face-to-face banking to communities and is committed to championing sufficient access for all as a priority. This is why the Government is working closely with industry to roll out 350 banking hubs across the UK. The UK banking sector has committed to deliver these hubs by the end of this parliament. 176 hubs have been announced so far, and 100 are already open.
The specific location of these hubs is determined independently by LINK, the operator of the UK’s largest ATM network. Criteria that LINK considers includes whether another bank branch remains nearby, the local population, the number of cash-accepting businesses and the financial vulnerability of the community.
Alternative options to access everyday banking services can be via telephone banking, through digital means such as mobile or online banking and via the Post Office. The Post Office Banking Framework allows personal and business customers to withdraw and deposit cash, check their balance, pay bills and cash cheques at 11,500 Post Office branches across the UK.
The Government recognises the significant impact the cost of living has had on personal finances, and particularly for those struggling with debt. We regularly engage with the Bank of England, the Financial Conduct Authority (FCA) and the Money and Pensions Service (MaPS) to monitor personal finances and debt levels. The Money and Pensions Service conducts an annual survey of people in financial difficulty. The results of their latest survey were published on 29 February 2024.
Given cost-of-living pressures, the Government remains committed to helping people that are in problem debt and vulnerable circumstances. For this reason, the Government offers a variety of debt advice services through the Money and Pensions Service to support individuals facing debt issues in England, including both national and community-based debt advice provision.
The Government has also put in place several measures to support the households who face the greatest hardships, including the Fair Repayment Rate for debt deductions in Universal Credit, which means approximately 1.2 million families will keep more of their award each month. The Household Support Fund has also been extended to 2025-26, which will help households facing financial crisis by supporting them with the cost of essentials such as food, energy and water.
We’ve also increased the National Living Wage to £12.21 per hour, an increase of 6.7% which is worth up to £1,4000 for a full-time worker.
With respect to business debt, this is principally a commercial matter. However, the Government is strongly supportive of the work of the British Business Bank as a critical tool to help ensure finance reaches those parts of the economy that otherwise may struggle to obtain the capital they need.
This is why at Autumn Budget, to help support the Government’s mission to kickstart economic growth, the Department for Business and Trade’s (DBT) settlement will allow them to invest over £1 billion across 2024–25 and 2025–26 for the BBB to enhance access to finance for small businesses, including over £250 million each year for small business loans programmes, including Start Up Loans and the Growth Guarantee Scheme.
Average offered interest rates on 2-year and 5-year fixed rate mortgages have fallen from their peak in the Summer of 2023.
The pricing and availability of mortgages is a commercial decision for lenders in which the Government does not intervene. Mortgage interest rates are in part driven by Bank Rate, set by the independent Monetary Policy Committee (MPC) of the Bank of England. The MPC continues to have the Government’s full support as it takes action to return inflation to target through its independent monetary policy decisions.
This government’s missions to deliver growth, restore stability, increase investment and reform the economy will support price stability and drive up prosperity and living standards across the UK.
In their October 2024 Economic and Fiscal Outlook, the Office for Budget Responsibility forecast real household disposable income (RHDI) per capita to grow by an annual average of 0.5% over this parliament. This is more than double the pace of RHDI per capita growth observed in the 2019-2024 parliament.
RHDI per capita is only reported at a national level, but to ensure growth is felt by everyone we are also monitoring GDP capita on a regional basis.
The Government does not hold bank branch closure data. However, according to consumer website Which?, South Holland and The Deepings constituency lost just over 60% of its branch network between January 2015 and November 2024, and has six branches remaining.
Guidance from the FCA sets out its expectation of firms when they are deciding to reduce their physical branches or the number of free-to-use ATMs. Firms are expected to carefully consider the impact of planned branch closures on their customers’ everyday banking and cash access needs, and put in place alternatives, where this is reasonable.
The Government is working closely with banks to roll out 350 banking hubs, which will provide individuals and businesses up and down the country with critical cash and banking services. The Government also recognises the value that building societies bring to local communities, including through their 28% share of the UK’s branch network.