Budget 2024: Jeremy Hunt cuts National Insurance and reforms child benefit but tax burden still climbing

We'll be updating you throughout the day with the latest news, analysis and announcements as Chancellor Jeremy Hunt prepares to announce the 2024 budget.

NationalWorld Politics Editor Ralph Blackburn has given his predictions ahead of budget announcement later today.

Tax cuts have been a key part of Tory Party policy for some times but the Chancellor will be very concerned about making any tax cuts that could risk fuelling inflation - after all he got his job after Liz Truss’ disastrous mini-Budget.

Hunt also looks likely to cut National Insurance once again. In the autumn, the Chancellor slashed this by two percentage points - from 12% to 10% - and it’s thought he wants to go further.

Read more of Ralph Blackburn's predictions here: 2024 UK Budget predictions: what will Jeremy Hunt do with income tax, national insurance and housing

Labour's shadow chancellor Rachel Reeves has taken aim at Jeremy Hunt and the Conservative Party ahead of the 2024 budget announcement.

Reeves said: “This Budget should be the final chapter of fourteen years of economic failure under the Conservatives that has left Britain worse off. 

 “The Conservatives promised to fix the nation’s roof, but instead they have smashed the windows, kicked the door in and are now burning the house down."

Reeves said that in Labour's view "nothing the Chancellor says or does can undo the economic vandalism of the Conservatives over the past decade."

She added: “The country needs change, not another failed Budget or the risk of five more years of Conservative chaos. Under Keir Starmer’s leadership, the Labour Party has changed and is now the party of economic responsibility. Only Labour has long term plan to deliver more jobs, more investment and to make working people better off.”

We've taken a look back at the last Spring Statement to see just how much progress has been made on Hunt's previous promises.

Rishi Sunak's cabinet has arrived at Downing Street ahead of the budget announcement due to be made later today.

Home secretary James Cleverly, foreign secretary Lord Cameron and defence secretary Grant Shapps are among those arriving at Downing Street this morning.

The Chancellor's Spring Statement is expected to be delivered at around 12.30pm.

Good morning from an overcast Westminster, where Jeremy Hunt will be announcing the Budget in just over three hours time. I'm NationalWorld's politics editor, and I'll be bringing you all of the updates from the press gallery overlooking the House of Commons. Please email with your thoughts and reaction to [email protected].

Here's a quick overview of Budget timings today:

Jeremy Hunt will hope that the Budget can arrest his party’s slide in the polls, which saw the Conservatives slump to their worst ratings with pollster Ipsos in 46 years. The Chancellor got little credit for cutting national insurance contributions in the autumn, and he is under pressure from his backbenches to cut tax again.

Both the Chancellor and the Prime Minister were heavily hinting at further tax cuts earlier in the year, however the noises out of the Treasury have since gone quiet. The problem for Hunt is that the fiscal headroom - the amount of money he has to spend within the government’s self-imposed rules - has reduced, as borrowing costs have gone up.

There is also the question as to whether cutting taxes will boost the Tories’ electoral chances. Most recent polls have shown the public are in favour of protecting ailing public services over slashing taxes. However, it’s likely that to afford any form of tax cuts, Hunt will have to reduce departmental budgets going forward.

One of the big questions for the Budget today is will Jeremy Hunt cut income tax?

Just over a month ago, it appeared almost nailed on that Sunak and Hunt would cut this. The Prime Minister had said at the start of the year that his “priority” is to “keep cutting people’s taxes”, and Tory backbenchers are convinced that their best chance of a recovery in the polls is by cutting income tax.

However, since then, the Treasury’s fiscal headroom has reduced after the latest forecasts by the Office for Budget Responsibility, the UK has entered a recession and inflation has remained sticky at 4%. The Chancellor will be very concerned about making any tax cuts that could risk fuelling inflation - after all he got his job after Liz Truss’ disastrous mini-Budget.

Hunt told Sunday with Laura Kuenssberg that any tax cuts will have to be “sustainable” and “affordable”. Now often at the Budget, Chancellors want to keep a rabbit in the hat, to pull out on the biggest stage to get maximum attention. There are murmurs in Westminster that this could happen, however this time I think an income tax cut is out of reach of Hunt. If conditions do improve, it's more likely we would announce a cut in a pre-election Autumn Statement or include it as part of the Tories' manifesto.

Read all of our pre-Budget predictions here.

If Hunt is unable to make a dent in income tax, he will almost certainly take a look at cutting National Insurance contributions. In the autumn, the Chancellor slashed this by two percentage points - from 12% to 10% - and it’s thought he wants to go further.

Cutting National Insurance is cheaper than income tax and is thought to be less inflationary as only people in work pay it. It also has a bigger impact on workers on lower salaries. The Chancellor will have to bring in some form of tax cut in this Budget, and I think it will be National Insurance.

Labour has just sent out a release claiming that in every fiscal event (budget or autumn statement) over the last decade the government has promised higher wages, higher skills and higher growth.

It says: "Despite the promises by successive Tory Chancellors, Britain is worse off – with higher taxes, lower wages and stagnant economic growth." The government would probably argue that wages are higher literally, in part due to inflation, however the tax burden is at its highest level since the Second World War and we're in a recession. Officials would certainly point to the pandemic and Russia-Ukraine energy crisis, however there is no doubt our economy is underperforming.

Labour points to the last fiscal event, when Hunt said: "Today’s Autumn Statement for growth.” However, since then the economy has gone into a recession. Whether the Labour Party can turn around our spluttering economy if they win the next general election is another question.

Speaking of Labour, Jeremy Hunt is expected to copy several opposition policies as he tries to raise money to fund tax cuts. In particular, Treasury officials are eying up reforms to the non-dom status, which allows wealthy individuals with earnings overseas to pay less tax.

This is something Rishi Sunak’s wife Akshata Murthy previously benefited from and the Chancellor previously said that abolishing the exemption would be “wrong” and drive high-earners out of the country. However, with money tight, this is being reassessed. 

There is also a political motive for doing this. Scrapping non-dom status has been promised by Labour, and is one of the party’s only major money earners. Money from this has been committed to measures including NHS improvements, so adopting the policy could lay a trap for Sir Keir Starmer, who would have to find an alternative way to pay for these pledges.

The government is also reportedly looking at extending the windfall tax on excess oil and gas profits, another policy which Labour has pushed.

Jeremy Hunt has been speaking ahead of the Budget. He said: “Because of the progress we’ve made because we are delivering on the Prime Minister’s economic priorities we can now help families with permanent cuts in taxation."

I presume he is referring to inflation halving, because the PM's other two priorities were to grow the economy and cut national debt both of which are not happening.

He said: “We do this not just to give help where it is needed in challenging times. But because Conservatives know lower tax means higher growth. And higher growth means more opportunity and more prosperity.”

Just a reminder that under this government, with certain mitigating factors like Covid and the Ukraine war energy crisis, the tax burden is at its highest level since the Second World War.

He added that growth “cannot come from unlimited migration”, but “can only come by building a high-wage, high-skill economy”. Hunt repeated the Tory attack line that Labour would take the country backwards, saying: “Instead of going back to square one, our plans mean more investment, more jobs, more productive public services and lower taxes, sticking to our plan in a Budget for long-term growth.”

Jeremy Hunt has just left Downing Street and is on his way to Parliament. He was pictured outside No10 with the famous red box.