Chancellor confirms his first Budget will be held on 28 October

The new Chancellor, John Healey, has confirmed that his first Budget will take place on Wednesday 28 October 2026, alongside the publication of an updated economic and fiscal forecast from the Office for Budget Responsibility (OBR).

Healey confirmed the date in a letter to the Treasury Select Committee, having asked the OBR to prepare its forecast for publication alongside the Budget.

The fiscal event will be Healey’s first since replacing Rachel Reeves as Chancellor and joining the new government led by Prime Minister, Andy Burnham.

AJ Bell public policy director, Tom Selby, suggested that Healey would seek to balance weak economic growth and global uncertainty with efforts to maintain the new government’s political momentum.

“Recently appointed Chancellor, John Healey, has wasted no time," he continued.

“It speaks volumes that he started June as Defence Secretary and ends July announcing his first Budget in a new government led by Prime Minister, Andy Burnham.”

Selby called on Healey to reconsider the planned inclusion of most unused pension funds and death benefits within estates for inheritance tax purposes from April 2027.

He argued that the proposals would create administrative complexity and delays for bereaved families, despite acknowledging the government’s rationale for reforming the favourable tax treatment of pensions on death.

AJ Bell has suggested alternative approaches, including applying a flat-rate charge to inherited pension funds or taxing beneficiaries through the income tax system.

“It is understandable government is looking at ways to address this through the tax system, but bringing pensions into inheritance tax is the worst way to do it,” Selby warned.

He added that, although there might be limited time to reverse the policy before its planned introduction, Healey should review whether a simpler approach could raise equivalent revenue without adding to the probate process.

Selby also argued that Healey should use the run-up to the Budget to provide greater certainty for pension savers and avoid renewed speculation about possible changes to pension tax rules.

AJ Bell has previously called for the government to introduce a Pension Tax Lock covering pension tax relief and pension commencement lump sums, more commonly known as tax-free cash.

The firm noted that speculation ahead of the 2024 and 2025 Budgets had contributed to a sharp increase in pension withdrawals.

Indeed, Financial Conduct Authority data showed that tax-free cash withdrawals rose by 40 per cent in 2023/24 and by a further 63 per cent in 2024/25.

Selby stressed that early clarity from the Chancellor could reduce the risk of savers making decisions based on speculation rather than their long-term retirement needs.

“A pledge not to meddle with people’s savings would show this government supports savers and retirees, and avoid a repeat of the last two fiscal events where billions exited long-term investments," he said.

This article originally appeared in our sister publication, Pensions Age.

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