The Budget
The nutshell
The Budget is the government's yearly plan for tax and spending. In it, the Chancellor tells Parliament how much money to raise in tax, and how much to spend.
Every fact on this page comes from Parliament's own guides and independent, non-partisan bodies. Each source tag — like Parl — opens where a fact comes from.
The basics
What the Budget is
The Budget is a speech the Chancellor of the Exchequer makes to the House of Commons, usually once a year. It sets out the government's plans for two things. The first is tax, the money the government collects. The second is spending, the money the government pays out on things like schools, hospitals and roads. The Budget also sets a plan for borrowing, which is money the government owes when spending is higher than tax.IfG
The forecast that comes with it
Every Budget comes with a forecast. A forecast is a careful guess about what will happen next. An independent body called the Office for Budget Responsibility, or OBR, works out how the economy and the government's money are likely to change over the next five years. The OBR publishes this forecast at the same time as the Budget.OBR
How a Budget becomes law
Announcing a change in the Budget does not make it law by itself. Some tax changes can start the same evening, under a Commons motion called the Provisional Collection of Taxes.Parl Most changes become law later, once Parliament passes a new law called the Finance Bill. A fresh Finance Bill turns the Budget's tax plans into law every year.HoC
- A Budget is where the government sets out its plans for tax, spending and borrowing, the Institute for Government explains.
- The independent Office for Budget Responsibility publishes a forecast of the economy and the public finances alongside every Budget, the OBR says.
- Some tax changes announced in the Budget can take effect the same evening, under a Commons motion called the Provisional Collection of Taxes, UK Parliament explains.
- A Budget announcement is not the final word, because most tax changes become law only when Parliament passes the Finance Bill, the House of Commons Library notes.
- The UK usually has more than one fiscal event a year, such as a Budget and a spring statement, not a single yearly plan, the Institute for Government notes.
- The OBR's figures are forecasts that can change as the economy changes, not fixed promises, the OBR says.
The deep end6 min
What a Budget covers
A Budget is a set-piece fiscal event, which means a planned moment when the government updates its plans for the public finances. The Institute for Government describes a Budget as one of the events where the government sets out decisions on how much to tax, how much to spend, and how much to borrow.IfG The Chancellor of the Exchequer presents the Budget to the House of Commons.
The independent forecast
Every Budget is published alongside a forecast from the Office for Budget Responsibility, the OBR. The OBR produces detailed five-year forecasts for the economy and the public finances twice a year, and these forecasts accompany the Budget and the spring forecast.OBR The OBR was set up in law to be independent of ministers, so the economic forecast behind a Budget is produced separately from the government.OBR
How Parliament turns a Budget into law
A Budget statement is not the same as passing a law. After the speech, some tax changes can take effect the same evening, under a Commons motion called the Provisional Collection of Taxes.Parl The Budget is then followed by several days of debate on the Budget resolutions, which are the tax measures the Chancellor announced.Parl To give those measures lasting legal effect, Parliament must pass a Finance Bill. A new Finance Bill is presented each year, and it enacts the Chancellor's Budget tax proposals and brings those proposals into law.HoC