The key takeaways from the Spring Statement 2025
A 5 minute read
The key takeaways from the Spring Statement 2025
As ever, the rumour mills were churning beforehand about major gaps in public finances to plug with welfare cuts and tax rises, but they didn’t come to fruition.
Regardless, it can be easy to feel confused or perhaps overwhelmed by the amount of information out there. Don’t worry, we got you.
Though pensions weren’t on the agenda this time, here’s a rundown of what happened in the Spring Statement 2025. You can thank us later.
Key announcements:
- No further tax increases
- Welfare system reform
- Defence spending increase
- Public services reform
- Inflation target to be reached from 2027
First, what is the Spring Statement 2025?
The Spring Statement is an annual speech delivered in the House of Commons by the Chancellor. It’s Rachel Reeves’ first major fiscal (AKA financial) event since the Autumn Budget last October.
To put it simply, the Spring Statement acts as an update on the economic health of the country. Since the Government pledged to only deliver one formal budget per year, this is a simpler affair. [1]
Essentially, it’s more a chance for the Chancellor to catch up both MPs and the country on the economy, and any progress made since the previous budget.
Here are the key takeaways from the Spring Statement:
No further tax increases
There were no further tax increases in the Statement, but Reeves stated that measures will be taken to reduce tax evasion.
The Government is to set out plans that will increase the number of tax fraudsters charged each year by 20%.
Welfare system reform
Reeves has stated that she will reform the welfare system, making it more sustainable for those out of work, and those who want to get into work.
Universal credit standard allowance is to increase to £106pw by 2029/30.
The Chancellor added that Universal Credit health element will be cut by half, and frozen for new claimants.
Defence spending increase
“The world has changed,” Reeves announced in her Statement. [1] As a result, Reeves announced that there will be an increase in defence spending by £2.2bn.
Reeves has dedicated 10% of the spending budget to novel technologies, like drones and AI enabled technology.
Public services reform
Reeves has announced a public services reform in the form of a Transformation Fund.
The Chancellor said that she’s bringing forward £3.25bn of investment to deliver reforms that public services need.
According to the Spring Statement 2025 report, this fund is to support “the fundamental reform of public services, seize the opportunities of digital technology and Artificial Intelligence (AI), and transform frontline delivery to release savings for taxpayers over the long-term.” [2]
Inflation target reached from 2027
Reeves announced that the 2% inflation target is expected to be met from 2027.
So, what happens next?
The announcements made at the Spring Statement are unlikely to affect your pension. But, if you want to get into the detail, you can read the Government’s full Spring Statement report here.
Unless otherwise stated, all statements in our article are taken from the Spring Statement announcement on 26th March 2025 and are accurate at time of writing.
Sources:
[1] Spring statement 2025 key takeaways | Politics News | Sky News. Data source: Sky News. March 2025.
[2] CP1298 – Spring Statement 2025. Data source: HM Treasury. March 2025.
