With the Labour Party back in power for the first time in 14 years, Rachel Reeves's budget announcement has been highly speculated and eagerly anticipated.
Announced today (Wednesday, 30 October), Rachel Reeves's budget is the first in our country's history to be delivered by a woman. Addressing girls and young women in her opening statement, the UK's first female Chancellor of the Exchequer said: “Let there be no ceiling on your ambition, your hopes and your dreams.”
Party treasurer for the Liberal Democrats, Tilly McAuliffe, wrote on X: “[I've] been thinking all morning about the fact this is the first ever budget delivered by a woman. When Rachel Reeves mentioned it, I welled up.”
These are the women heading to Westminster – but what do they stand for?
GLAMOUR spoke to four leading experts for detailed insight into how the budget will affect women and girls, and key takeaways for the most important issues facing us today. Here's everything you need to know about Rachel Reeves's budget.
Meet the experts
Dr Maranda Ridgway is Associate Professor of People and Inclusion at Nottingham Business School and is an expert on intersectionality and women’s career advancement.
Dr Ylva Baeckström is a Senior Lecturer in Finance at King's Business School, as well as a former banker, start-up CEO and practising psychotherapist.
Rachel Watkyn OBE is an entrepreneur, founder of The Tiny Box Company and supports women through her work with mental health charity Mind.
Victoria Harris is founder of The Curve Platform, a leading financial education platform and community for women in their 20s and 30s dedicated to closing the gender wealth gap.
How will the budget affect the cost of living?
According to statistics from the House of Commons, the Consumer Prices Index rose from under 1% in early 2021 to 11.1% in October 2022. This huge increase has seen the price of essentials like food and housing skyrocket, making the cost of living an everyday crisis.
Thankfully, one of the most tangible changes that will come from today's budget is an increase to the national living wage (also known as minimum wage). This will be rising from its current rate of £11.44 (for those over 18) to £12.21. The change will come into effect from April 2025. For those aged 18-20, the rate will increase from £8.60 to £10 and for those under 18 it will increase from £6.40 to £7.55.
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Expert Victoria Harris tells GLAMOUR how this increase is a great step forward, but will require a balancing act due to the increased cost to employers. “In retail, hospitality, and care sectors - across which women make up the majority of employees - the higher wage is important for financial independence,” she says. "But we need to be realistic about potential impacts on job availability and flexibility offered, as businesses absorb both wage increases and higher National Insurance contributions.”
The Chancellor confirmed there will be no increase to employee National Insurance, VAT, or Income Tax. However, employer National Insurance will increase from April 2025 (more on that below).
As wages are set to rise, so too are some everyday costs. The price of public transport will increase as the bus fare cap is rising from £2 to £3, and there will be an increase in air passenger duty of £2 per passenger on economy short haul flights. However fuel duty will not be increasing, which means you won't see any immediate increases in the amount you pay to fill up your car.
How will the budget affect women-owned businesses?
According to the Federation of Small Businesses, women-owned and women-led businesses now make up nearly 24% of private sector employment. And according to figures published by UK parliament, in 2022 just over 20% of all new companies were all-female led, up from 17% in 2018. Around 2 in 5 entrepreneurs in the UK are women, meaning it's more important than ever that the government supports small businesses.
In today's budget, it was announced that Employment Allowance will rise from £5,000 to £10,500. This means thousands of small businesses won’t need to pay National Insurance next year, which will help to boost growth and job creation.
However, after Labour promised not to raise tax levels for “working people”, the Chancellor has announced an increase in employer National Insurance contributions, which will be rising to 15%, an increase of 1.25%.
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“The increased Employment Allowance offers some relief against other rising costs which is positive,” says Harris. “However, while this £5,500 boost in annual savings is a great incentive, it needs to be viewed alongside the incoming NI contribution increases.”
Harris explains that this higher allowance will help to offset the higher operational costs associated with owning a small business or start-up, but it won't fully compensate for the broader National Insurance changes. “In real terms, it’s a small financial buffer to give some breathing room to allow for key business investments and development,” she says.
How will the budget affect schools and childcare?
In a move that will support millions of children across the country, and which makes good on one of Labour's manifesto promises, Reeves announced that she will be tripling funding for school breakfast clubs. The government's investment in these vital childcare schemes will increase to £30 million in 2025 and 2026, with a £7 million trial across 750 schools starting in April.
The Treasury also confirmed £1.8 billion would be allocated to the expansion of government-funded childcare, with a further £15 million of funding for school-based nurseries. The Treasury said the first stage of the plan would pay for 300 new or expanded nurseries across England.
High childcare costs, sexist attitudes, and a lack of flexible working options are forcing mothers out of the workplace.
The Chancellor has also pledged a £2.3 billion increase in core schools budgets from next year, plus £300 million for further education. Reeves has said she will provide £6.7 billion of capital investment in education starting from 2025, an increase of 19% on this year.
This includes £1.4 billion to rebuild schools with dangerous Raac concrete and £2.1 billion for maintenance. The Chancellor emphasised that children "should not suffer" from lack of public funding.
How will the budget affect my ability to buy a house?
For many millennials and Gen Z women, the prospect of buying a house is dauntingly unaffordable. According to statistics published in The Times, more than one third of UK households rent their home.
The UK's leading feminist economics thinktank, Women's Budget Group, wrote on X today: “The Chancellor committed to make this economy work for women. She needs to address the widening gender housing affordability gap in order to deliver on this promise; an economy in which women can barely afford to rent on their own is clearly not working.”
It's been 50 years since women in the UK were legally allowed to apply for a mortgage without a male guarantor. But the home ownership gap is still very much a thing.
In today's budget, Reeves announced that the Affordable Homes Programme will be increasing to £3.1 billion and that the government will be “delivering thousands of new homes”.
“We will provide £3 billion worth of support in guarantees, to boost the supply of homes and support our small house builders," the Chancellor said.
In order to help support social housing, the government will be cutting discounts offered under the Right to Buy scheme. Currently, Right to Buy discounts offer council tenants up to 70% off their home purchases. The aim of this reform is so that local authorities can put more money back into social housing investments.
How will the budget affect the NHS?
Rachel Reeves's autumn 2024 budget received a huge applause in the Commons when it came to announcements about the NHS. Reeves unveiled an additional £22.6 billion of resource spending for the day-to-day health budget for this year and next. There will also be an additional £3.1 billion increase to the capital investment budget for the NHS for this year and next.
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However, expert Rachel Watkyn OBE doesn't think these measures will go far enough. “Unfortunately, the NHS is in such chaos I don’t think just pouring more money in is the answer,” she tells GLAMOUR. “All the government has said to date is that this investment is to bring down waiting times and to add more scanners and diagnostic machines. This doesn’t touch on the huge inefficiencies or the lack of systems across the NHS.”
Local government will also receive £1.3 billion additional grant funding for essential services, including £600 million for social care. With over 85% of the social care force being made up of women, this investment will come as welcome news.
