Chancellor Rachel Reeves will give an update on the UK economy during the Spring Statement.
The chancellor will address the House of Commons and respond to forecasts from the Office for Budget Responsibility (OBR) for growth, inflation, government spending and tax income.
What is the Spring Statement and when is it this year?
The Spring Statement is a once-per-year update given by the government on the state of the UK economy.
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It is accompanied by a report from the OBR which sets out forecasts for the economy over the coming years and the effect of previously announced policies on the economy.
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The OBR is an independent body set up in 2010 which offers analysis of the UK’s public finances. It produces two forecasts a year as well, with one coming alongside the Spring Statement and the other alongside the Budget.
The OBR also assesses whether the chancellor is on course to meet their targets for the public finances, also known as “fiscal rules”.
The two main current fiscal rules are that the government cannot borrow to fund day-to-day spending and debt needs to be falling as a share of the economy by 2029/30.
Until recently, the OBR assessed whether the government was meeting its fiscal rules alongside both of its two forecasts for the year.
However, following a change announced in the 2025 Autumn Budget, from now on, it will only do this once a year alongside the Budget.
The 2026 Spring Statement will be made on 3 March, although exactly when Reeves will address the House of Commons is unclear.
What can we expect from the Spring Statement?
Reeves isn’t expected to announce any major policy changes. She will instead use the Budget to do this.
The chancellor is keen to make major tax and spending announcements just once a year in order to avoid excess speculation over policy and offer financial markets more stability.
What is going on with the UK economy?
The Labour government has made boosting economic growth one of its top priorities – better economic growth means peoples’ quality of life should improve.
But there are concerns that growth is stagnating. The UK’s Gross Domestic Product (GDP) grew just 0.1% in the last three months of 2025, according to the latest data from the Office for National Statistics (ONS), although it grew by 1.3% over the whole of 2025.
Inflation also sits at 3%, based on the Consumer Price Index (CPI) measure. It has slowed from 3.8% in September 2025, but nevertheless is above the government’s 2% target.
Unemployment has hit its highest level since 2021, climbing 5.2% in the three months to December 2025. The current rate of unemployment among 16 to 24-year-olds across the same three month period was 16.1%, its highest level since 2014, based on ONS data.
However, wages continue to grow, with annual growth in weekly earnings between October and December 2025, excluding bonuses, rising by 4.2% and above inflation.
The latest figures also reveal an uptick in tax receipts created a £30.4 billion government budget surplus in January. The ONS said this was £15.9 billion more than in January 2025 and the highest surplus (when not adjusted for inflation) since monthly records began in 1993.
