This briefing explores what announcements the government could make in the King’s Speech on 13 May 2026 about economics, business and trade. It also summarises the current economic situation.
The bill is a short, technical bill with two substantive clauses. The bill would amend existing legislation to increase the statutory limits on financial assistance the government can provide to support UK industry and exports. It would do this by increasing the funding limit in the Industrial Development Act 1982 to £20bn and in the Export and Investment Guarantees Act 1991 to £160bn.
The House of Lords European Affairs Committee published a report on the UK-EU reset in November 2025, describing it as “unfinished business”. Ahead of a debate on the committee’s report, this briefing looks at progress on implementing commitments made at the UK-EU summit in May 2025, including negotiations on a sanitary and phytosanitary agreement, emissions trading, participation in the EU electricity market and a youth experience scheme. It also summarises the committee’s findings and the government response.
In Focus
This briefing provides details on the trade deal signed between the UK and India in July 2025. It includes information on parliamentary scrutiny of the deal, including the report by the House of Lords International Agreements Committee. The government expects the deal to boost UK trade with India and UK GDP. However, concerns have been raised over ongoing negotiations for a ‘double contributions convention’ with India and the potential impact of the deal on certain UK sectors.
In Focus
Recent UK governments have emphasised collaborative partnership approaches to development assistance. However, concerns have been raised that the current level of development aid spending, below the statutory target, is impacting the UK’s potential for international influence. While the UK ranks highly in most ‘soft power’ lists, the USA tends to rank higher and other states are showing rising influence. The government has launched a Soft Power Council to identify and drive opportunities.
In Focus
The government is negotiating an EU ‘reset’ involving an animal and plant health agreement, the UK joining the EU’s electricity market and linking up emissions trading systems. The Liberal Democrats are calling for a bespoke UK-EU customs union, but the Conservatives and Reform UK argue against measures they believe would undermine UK sovereignty. This briefing examines proposals for a customs union and the implications of closer connections with the EU single market.
In Focus
The UK and Israel engaged in trade worth £6.2bn in the year to the end of Q2 2025, with the UK reporting a total trade surplus of £1bn over that period. Trade relations are governed by a trade agreement that took effect after the UK’s Brexit transition period. The UK and Israel later launched negotiations on a new free trade agreement. However, the UK government suspended negotiations in May 2025.
In Focus
At the turn of the twentieth century, debate about the UK’s fiscal policy centred on the issue of tariffs. In July 1904, the House of Lords debated the government’s fiscal policy, and whether the then Conservative government supported the introduction of tariffs as some leading political proponents thought. Moving away from ‘free’ trade to what some considered ‘fair’ trade proved to be both a controversial and divisive policy idea. This briefing looks back to the Lords debate and identifies the key contributions made.
In Focus
On 12 April 2025, Parliament was recalled to fast-track the passage of the Steel Industry (Special Measures) Act 2025. The government has used the act to direct the operations of British Steel Ltd, which was in danger of collapse. British Steel operates the UK’s remaining blast furnaces at its site in Scunthorpe. This briefing summarises the challenges the UK steel industry has faced in recent years, how the act’s powers have been used in the case of British Steel, and wider government policy on steel.
In Focus
The US has announced significant increases in tariffs on imports, although has delayed full implementation. Many economists view tariffs unfavourably, arguing that they raise prices, reduce competition and risk retaliation. But others suggest that tariffs may benefit the country that applies them. UK exports to the US face an additional 10% tariff. This could be negative for UK exports and the economy. But there could be some upsides for the UK if the US goes ahead with higher “reciprocal” tariffs on many of the UK’s competitors.
In Focus
In February 2025, the UK government announced that it was resuming negotiations with India with the aim of agreeing a free trade deal. This followed work by the previous Conservative government which initially opened trade talks in 2021. An overview of these talks is provided in this briefing alongside information about the UK’s relationship with the Association of Southeast Asian Nations (ASEAN). Relevant trade statistics are also included.
In Focus
The government has identified the creative industries as one of eight “growth driving” sectors it will prioritise in its industrial strategy. The strategy is due to be published later this year, along with a creative industries sector plan. The creative industries have called on barriers to growth, such as skills gaps and access to funding, to be addressed in the sector plan.
In Focus
Multinational corporations may use artificial intragroup transfers and other strategies to lower their exposure to corporation tax. Following high profile examples of aggressive tax avoidance, OECD countries including the UK agreed a number of measures to reduce so-called ‘profit shifting’ and increase tax revenues globally. This included a global minimum tax for large corporations. US President Donald Trump has since signalled the US no longer agrees with the latest OECD tax agreement.
In Focus
Relations between the UK and China are complex. China is an important trading partner for the UK but its human rights record and global actions attract regular concern and criticism. The Labour government has said that its relationship with China will be based on cooperation, competition and challenge. This briefing looks at the new government’s stance, as well as its position on issues such as Hong Kong, Taiwan and China’s human rights record.
In Focus
The government has recently changed the entry requirements for certain non-EU goods being imported into Great Britain to enable them to move onwards under the Northern Ireland retail movement scheme. The House of Lords is due to consider a motion to annul the regulations that made these changes. This comes in the context of wider debates about the impact of the Windsor Framework on Northern Ireland.
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