What to expect from the Spring Statement – and what to do about it

On 3 March, the Chancellor will deliver the Spring Statement to Parliament. If you've heard the term and wondered whether it's worth paying attention to, the short answer is: yes, but probably not for the reasons you'd think.

This isn't a Budget. There shouldn't be any big tax changes or spending announcements. Rachel Reeves has committed to keeping those for one major event a year – the Autumn Budget. So the Spring Statement is more of a health check. The Office for Budget Responsibility will publish updated forecasts for the economy, and the Chancellor will respond. No drama. Just data.

But that data matters, because it gives us a much clearer picture of where things are heading – and that affects everything from interest rates to how much tax you're likely to pay in the years ahead.

So what's the Spring Statement actually for?

Think of it as a mid-year check-up. The OBR (Office for Budget Responsibility) will update its forecasts for economic growth, inflation, employment and public borrowing. The Chancellor then tells Parliament how the government plans to respond – or, more likely this time, confirms that the plans set out in the Autumn Budget are still on track.

It's the first time the Spring forecast won't include a formal assessment of whether the government is meeting its own fiscal rules. That's a deliberate change – the idea is that assessing the rules only at the Budget gives everyone more certainty. But the numbers will still be there for anyone who wants to look at them.

What are we watching for?

There are a few things I'll be looking at closely.

• The growth outlook. The UK economy has been sluggish. Economic growth (GDP) was around 1% in 2025, and most forecasters are expecting something similar this year – somewhere between 0.9% and 1.4% depending on who you ask. That's not a recession, but it's not exactly firing on all cylinders either. If the OBR downgrades its growth forecast further, it puts more pressure on the public finances and raises the question of whether further tax rises might be needed down the line.
• Inflation. It's been stickier than anyone would like. The Consumer Prices Index (CPI) was 3.4% in December, well above the Bank of England's 2% target. The good news is that most forecasters expect it to drop quite sharply from April, partly because of the government's energy bill measures. If the OBR's inflation forecast improves, that's positive for interest rates and for anyone whose income is being squeezed by rising prices.
• Interest rates. The Bank of England held the base rate at 3.75% in February, with a narrow 5-4 vote. Most economists expect further cuts this year – possibly starting in April – but the pace is uncertain. The Spring Statement won't set interest rates directly, but the economic picture it paints will influence what the Bank does next. For anyone with a mortgage, or thinking about remortgaging, this is worth watching.
• Borrowing. The government's fiscal headroom – the amount of breathing room it has against its own borrowing rules – was around £22 billion at the last Budget. That sounds like a lot, but the OBR's average forecast revision is around £20 billion, so it doesn't take much for that cushion to shrink. If the numbers look tighter than expected, it could signal that more difficult decisions are coming at the next Budget.

What's already locked in for April?

Regardless of what the Spring Statement says, a number of changes are already confirmed for the new tax year. These were set out in the Autumn Budget and they're happening either way.

Dividend tax rates are going up by 2 percentage points. If you're a business owner taking dividends, or you hold shares outside an ISA, that's a real increase in cost from 6 April.

The personal allowance and income tax thresholds remain frozen until at least 2028. That means if your wages go up at all, you're more likely to be pushed into a higher tax band. It's sometimes called fiscal drag, and it's one of the biggest stealth tax increases of recent years.

The state pension rises by 4.8% to around £12,548 a year. That's good news for retirees, but it also pulls more pensioners into the income tax net – particularly those with additional private pension income.

Business Asset Disposal Relief rates are increasing from 14% to 18%, and the rules on inheritance tax relief for business and agricultural property are being tightened with a new £1 million cap on full relief.

Making Tax Digital for income tax kicks in for anyone with self-employment or rental income over £50,000. That means quarterly digital reporting to HM Revenue & Customs – a significant change for a lot of people.

Should I be worried?

Honestly, no. Not about the Spring Statement itself. The whole point of having one Budget a year is to avoid surprises. And the Chancellor has been very clear that 3 March is not the place for major announcements.

But what the Spring Statement will do is set the mood for the rest of the year. If the economy is weaker than expected, if borrowing is higher, if growth disappoints – those are signals that the Autumn Budget could be more eventful. And that's when planning ahead becomes really valuable.

The thing I'd encourage people to do is not to wait for the headlines and then react. The changes that are already confirmed for April are the ones that actually matter to your money right now. And most of them are things you can plan around – whether that's using your ISA allowance before the tax year ends, reviewing your pension contributions, thinking about how you take income from your business, or checking whether your estate planning still holds up under the new inheritance tax rules.

What should I actually do?

If I had to boil it down to three things:

First, don't make financial decisions based on headlines. The Spring Statement will generate plenty of commentary, but the practical impact on your day-to-day finances is likely to be limited. The changes that matter are the ones already in the pipeline.

Second, use the next few weeks wisely. The tax year ends on 5 April. If you haven't reviewed your ISA, pension, or capital gains position, now is the time. We've written a separate piece on the key year-end deadlines worth checking.

Third, if you're uncertain about how any of the April changes affect you – whether it's the dividend tax increase, the inheritance tax changes, or Making Tax Digital – have a conversation with your adviser sooner rather than later. These things are always easier to manage with a bit of lead time.

We'll be watching the Spring Statement on 3 March, and if anything comes up that changes the picture, we'll share our take. But for now, the best thing you can do is focus on what's in front of you.

Please note that these are general considerations and not personal advice.

Daren Wallbank - Chartered Financial Planner, Ginkgo Financial

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