The Chancellor has announced five measures designed to ease household costs ahead of Wednesday's Budget, targeting millions of working people, families and unpaid carers across the country. The package addresses everyday expenses including food and fuel, while extending support to new parents and fixing rules that penalise unpaid carers for earning additional income. HM Treasury said the measures follow action already taken on airline charges, subscription traps and school uniform costs as part of the Prime Minister's 'everyday fixes' initiative.
The centrepiece of the announcement involves mileage allowances for workers who drive for their jobs. The government will lock in a 55 pence per mile tax-free rate for the first 10,000 business miles driven annually, with the rate above that threshold rising from 25 pence to 35 pence per mile. This represents the largest increase in mileage rates for 15 years and is expected to benefit around three million employees and self-employed people. A worker doing 6,000 business miles per year could receive an additional £120 in tax savings, while someone driving 15,000 business miles annually could save up to £300.
Parental support is being extended to more than 150,000 additional parents per year under the changes, including self-employed fathers and partners who previously did not qualify. Eligible parents will receive two weeks of support worth up to £194 a week to spend time with newborns. The government is also ending the Carer's Allowance cliff edge, which currently removes all support if carers earn a single penny over the weekly earnings limit equivalent to 16 hours of the National Living Wage. Under the reform, carers will lose only £1 of support for every additional £1 earned.
On food costs, HM Treasury is removing import tariffs on more than 100 products including baked beans, chocolate, gherkins, garlic, plant-based beverages and fertilisers. Alongside tariff suspensions already introduced earlier in the year, households could save up to £21 annually on their food shop. The two tariff packages combined are expected to reduce consumer costs by approximately £245 million to £595 million per year. A separate Warm Homes loans scheme is being launched, offering homeowners access to low-interest and interest-free finance to install solar panels, batteries and heat pumps.
The Post Office network is being expanded with 500 self-service parcel drop boxes in place by the end of this year, rising to 1,000 by the end of the financial year, while 600 Post Office branches will receive upgrades. The Chancellor said the measures provide breathing space as global events including conflict in the Middle East and Europe push up household costs. For working people and savers in the UK, these measures mean lower costs on everyday shopping and potentially higher take-home pay if they drive for work, while unpaid carers will face reduced financial penalties for earning extra income.
Prime Minister Andy Burnham said the fixes addressed everyday frustrations and put 'more money back in your pocket' for nurses, parents and unpaid carers. The announcements come ahead of the full Budget, which HM Treasury said will focus on 'giving families and businesses breathing space with the costs they face today, while taking the long-term decisions needed to strengthen the economy and support growth.'