What could be in the UK Spring Statement 2025?

The Spring Statement 2025 is set for 26th March, when Rachel Reeves will deliver her latest update. While the Treasury has downplayed its importance, the economic figures and reaction to October’s Budget mean all eyes will be on the House to see what the Chancellor does next. 

In this blog

What to expect from the Spring Statement 2025

Conclusion and key takeaways

What to expect from the Spring Statement 2025

As the economy continues to face inflation and slow growth, Spring Statement 2025 will provide insights on government fiscal strategy. The official line is that no policy changes will be made. However, the desire to promote growth and revitalise the employment market could potentially prompt a rethink. Time will tell. 

National insurance rise: further comment? 

The upcoming rise in employers’ national insurance has generated some pushback from the business community. It remains to be seen whether any further announcements or clarifications will be provided on this score.  

As things stand, however, employers should ensure their HR and payroll system is set up to make the correct new deductions of 15%. The lower threshold also means that the tax may be due on additional employees who were previously exempt. 

New forecasts: OBR report 

New figures on the state of the UK’s finances will be released on the same day as the statement and included in the speech. These forecasts from the Office for Budget Responsibility (OBR) will have a bearing on what Rachel Reeves has to say. For example, an unexpectedly bad outlook might prompt a policy change or delay to measures already announced. 

What could it mean for UK employment laws? 

The current government has already introduced a programme of intended changes to HR legislation in the Employment Rights Bill. This continues to make its way through Parliament and so we’re unlikely to hear any updates on that as part of the Spring Statement 2025. 

However, it looks like the job market is slowing down, with a fall in vacancies and employer confidence. In this light, the possibility of adjustments or new policies to encourage hiring can’t be completely ruled out. Again, much will depend on the economic figures the chancellor is faced with when the statement date rolls around. 

Payroll legislation changes still on track? 

All payroll professionals are used to the evolving nature of payroll legislation. Last October’s Budget announced a raft of updates to National Insurance, minimum wage, benefits-in-kind, and more. The majority of these take effect from 6 April for the new tax year. While there’s been no change reported, these could be another potential area for adjustments, delays, or tax relief if the chancellor decided it was necessary. 

The employee’s national insurance rate remains the same but — crucially — so does the threshold. This means more employees on lower earnings will be pulled into paying the tax. So it’s worth checking your employee financial wellbeing policies and making sure employees are aware of any support or company benefits available to help them. 

Conclusion: keep an eye out for surprises 

While the Treasury is downplaying the Spring Statement 2025, the economic backdrop and the upcoming OBR forecasts mean that HR and payroll professionals should stay tuned. The potential for adjustments to national insurance, or even new measures to stimulate employment, can’t be entirely dismissed. Meanwhile, keep an eye on previously announced legislative and payroll changes from the Autumn Budget to see if there’s any adjustment in light of the economy.  

What we do know is that the Spring Statement will provide a snapshot of the UK’s fiscal health and the government’s strategic direction. With employment such a crucial driver of the economy, any policy announcements or adjustments may well impact HR and payroll. 

Key takeaways

• The Spring Statement 2025, scheduled for 26th March, will provide important insights on the UK’s fiscal strategy and outlook. 
• The rise in employers’ national insurance contributions remains on the cards. HR and payroll teams should ensure their systems are prepared for the changes. 
• The OBR’s new economic forecasts, released alongside the statement, are likely to influence the Chancellor’s announcements and potential policy adjustments. 
• While major updates to the Employment Rights Bill are unlikely, the slowing job market could prompt new measures to encourage hiring. 
• Payroll professionals should remain prepared for potential adjustments to existing payroll legislation, including national insurance, minimum wage, and benefits-in-kind. 
• The unchanged employee’s NICs threshold means more lower income employees will be paying the tax, so it would be wise to review employee financial wellbeing policies. 

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