Spring statement 2026 and Finance (No. 2) Bill: HL Bill 177 of 2024–26

Approximate read time: 30 minutes

On 3 March 2026, Chancellor of the Exchequer Rachel Reeves delivered the government’s spring forecast statement. In tandem with the chancellor’s statement, the Treasury published updated Office for Budget Responsibility (OBR) forecasts for the UK’s economic and fiscal outlook. As expected, the chancellor did not make any new spending or tax announcements as part of the spring statement. The government intends there to be one fiscal event per year, the most recent of which was the budget delivered in November 2025. 

The OBR said its overall forecast remained largely unchanged from that which it delivered in November 2025, though there was some adjustment to key indicators including the rate of GDP growth expected across the current parliament, GDP per person, wage growth and unemployment. The OBR said the fiscal context for the next budget will remain challenging. It highlighted the UK’s public sector debt as a share of GDP and public sector net borrowing as areas of particular concern.  

In addition, the OBR’s forecast was prepared before the escalation of the ongoing crisis in the Middle East, and observers have suggested events in Iran have already upended some of the assumptions made in the OBR’s data. The OBR itself has acknowledged the uncertainty generated by several issues including the Iranian conflict, international tariff policy, productivity growth, and pressures on public spending, all of which could significantly affect its forecast.  

The Finance (No. 2) Bill will implement many of the taxation measures announced in the 2025 budget. The bill contains measures on personal taxation such as income tax thresholds, corporate tax such as capital gains tax relief, and indirect taxation such as gambling levies. However, other important elements announced in the budget are being addressed through other means or will be the subject of consultation before changes are made. These include changes to national insurance contributions, the removal of the two-child benefit cap and the introduction of a tax on residential properties valued at or over £2mn. The bill is due to be considered at second reading and all remaining stages in the House of Lords on 17 March 2026 alongside a debate on the spring statement, though as it is a supply bill the Lords has limited powers of scrutiny and cannot amend the legislation. 

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