Economy · Budget & tax · 31 October 2026
Chancellor cuts fiscal buffer and revises gilt issuance plan
The Chancellor has reduced the buffer against fiscal rules and revised the DMO’s financing remit. National Institute of Economic and Social Research published the figures. Major spending decisions are deferred until the 2027 Spending Review.
The Chancellor delivered a Budget containing measures intended to provide breathing space to households, alongside a revision to the DMO’s financing remit. National Institute of Economic and Social Research has published the details of these fiscal changes. The announcement includes adjustments to energy bills and council taxes to address cost-of-living pressures.
The Chancellor’s buffer against fiscal rules has been reduced from £23.6 billion to £14.5 billion. The DMO’s financing remit for 2026-27 has been revised up by £7.4 billion, taking planned gilt issuance to £250.6 billion. The ten-year gilt yield has risen by around 100 basis points since February to around 5.3 per cent.
The OBR forecasts increased borrowing of £12.4 billion over the next three years. Public Sector Net Debt is forecast to peak at around 97 per cent of GDP in 2028-29. Major fiscal decisions on defence and other spending are deferred until the 2027 Spending Review.
The announcement does not specify the exact timing for the implementation of the energy bill and council tax changes.
Written by StreetOwl from National Institute of Economic and Social Research, a think tank’s own announcement. It was drafted by StreetOwl’s own model, every figure and quotation was checked by code against the announcement, and it was read and approved by Michael Rossi before it went up. It says what was announced, not what anyone should do about it.
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