Issued by: HM Treasury

Chancellor unveils five everyday fixes to ease household costs, support working families and end the Carer’s Allowance cliff edge ahead of Wednesday’s Budget.

• Millions of working people, families and unpaid carers to benefit from five practical fixes to everyday costs ahead of Wednesday’s Budget.

• Government action taken on food and fuel, alongside parental pay rights for more than 150,000 additional parents per year.

• Unpaid carers no longer left worse off simply for earning more.

Millions of families, working people and unpaid carers across the country will benefit from five everyday fixes unveiled by the Chancellor, supporting people with the cost of food, fuel and family life, providing breathing space for households.

The package will tackle costs people face every day, from doing the weekly shop to supporting people who rely on their cars for work, while extending support to new parents and fixing an unfair cliff edge that can penalise unpaid carers for earning more.

This is the latest in the Prime Minister’s series of ‘everyday fixes’ designed to tackle everyday frustrations, save families time and money and give them more room to breathe. It follows action on unfair airline charges, subscription traps, rogue traders and rip-off school uniform costs.

It comes ahead of the Budget on Wednesday focused 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 and bring costs down.

Prime Minister Andy Burnham said:

"We are taking on the big challenges facing the country. But that doesn’t mean losing sight of the everyday problems that cost people money or simply aren’t fair.

"If you’re a nurse driving for work, a parent spending those precious first weeks with your new baby, or an unpaid carer picking up an extra shift, these changes will make life a little easier and put more money back in your pocket.

"And at Wednesday’s Budget, we’ll go further to give families and businesses the breathing space they need today, while we build a stronger economy, transform our country and bring down cost for people long-term."

The Chancellor of the Exchequer John Healey said:

"Today’s everyday fixes are just a small part of what we are doing to give families a bit of breathing space.

"Conflict in the Middle East and Europe is hitting families here at home through higher everyday costs.

"We can’t control global events, but we can act where we can make a difference."

Business Secretary Jonathan Reynolds said:

"This is a real boost for working families and carers. This Budget is about making hard-earned money go further, easing the pressure of everyday costs and giving families much-needed breathing room.

"Families have so much to juggle, from paying the bills to balancing work and caring for loved ones. This support can make a real difference—not just in managing today’s costs, but in helping families look ahead with greater confidence and optimism."

Work and Pensions Secretary Pat McFadden said:

"I understand the huge difference unpaid carers make to their families and communities. Many balance work alongside their caring responsibilities.

"We have listened to their concerns about the cliff-edge built into the system which leaves them financially worse off for taking on a few more hours, or getting a modest pay rise, and intend to bring that to an end."

Today’s announcements include:

• Making higher tax-free mileage rates permanent and increasing support for nurses, care workers, self employed builders and others who drive for work. The Chancellor is locking in the 55p per mile rate for the first 10,000 business miles and increasing the rate above 10,000 miles from 25p to 35p per mile, supporting around three million employees and self-employed people who use their own vehicle for work.

• Extending parental pay to more than 150,000 additional parents per year, including self-employed dads and partners who have previously missed out, giving eligible parents two weeks of support currently worth up to £194 a week so they can spend more time with their child.

• Ending the Carer’s Allowance cliff edge, so unpaid carers no longer lose their entire allowance simply for earning a penny over the Weekly Earnings Limit, equivalent to 16 hours of the National Living Wage. Instead, only £1 of support will taper away for every additional £1 earned.

• Removing import tariffs on more than 100 products, helping lower import costs on family favourites including baked beans, chocolate and gherkins, while also supporting farmers facing higher fertiliser bills and households that rely on kerosene heating oil. Together with tariff suspensions already introduced, households could save up to £21 on their food shop each year.

• Rolling out hundreds more Post Office drop boxes, bringing the total to 1,000, making it easier and more convenient for people to send and return parcels without having to queue at a Post Office counter, helping take some of the hassle out of everyday errands in the run-up to Christmas. This comes alongside upgrades to 600 Post Office branches by the end of the financial year, improving services for customers across the country.

Carers Trust Chief Executive, Kirsty McHugh, said:

"It is great news that the Government is acting to remove the Carer’s Allowance cliff edge. This has long been a concerning part of our benefits system, penalising thousands of carers who are juggling paid work with their caring role. Carers all over the country should now be able to take comfort that they will be able to earn that bit more without being inadvertently plunged into debt."

George Gabriel, co-founder of The Dad Shift said:

"This paternity pay will make a real difference to tens of thousands of expecting families each year, giving self-employed dads a chance to show up for their loved ones at one of the moments that matters most. We hope more will be done through the government’s review of parental leave, but fair shout to the Chancellor for showing he gets it and for showing he respects the role these hard working blokes want to play as fathers."

Emily Holzhausen CBE, Director of Policy at Carers UK said:

"We have been calling for a taper to the earnings limit and an end to the cliff edge on Carer’s Allowance for many years and we’re pleased that the Chancellor has committed to this next step. Our evidence from unpaid carers found many having to give up part-time paid work altogether or turning work down because they cannot risk going over the limit and losing 100% of their Carer’s Allowance. Once introduced, it should also help to significantly reduce the number of overpayments related to earnings which carers have found devastating financially and emotionally."

Today will also mark the launch of a new Warm Homes loans scheme, giving homeowners across the UK, including Scotland, Wales and Northern Ireland, access to low-interest and interest-free finance to install clean energy technology including solar panels, batteries and heat pumps.

NOTES TO EDITORS:

Mileage rates:

The Government will lock in the biggest increase in mileage rates for 15 years, ensuring employees and self-employed people can continue to receive up to 55p per mile tax-free for the first 10,000 business miles they drive each year. Following a review, the government is also going further with the rate for those who drive over 10,000 miles also rising from 25p to 35p, supporting those who drive significant mileage for work.

Around 3 million people are expected to benefit. The change means workers who rely on their vehicle for their job can receive greater support with the costs of fuel, servicing and other motoring expenses. These changes will provide £120 a year in additional tax savings for a worker doing 6,000 business miles, with someone driving 15,000 business miles receiving up to £300 in additional tax savings.

Food tariffs:

Other products which are expected to see their tariffs cut include:

• Garlic (8% + £100 per 100 kg)

• Gherkins (12%)

• Citrus jams, marmalades and pastes (20% + £19 per 100 kg)

• Throat pastilles and cough drops (8%)

• Boiled sweets, filled or unfilled (8%)

• Toffees, caramels and similar sweets (8%)

• Plant-based beverages (soya, nut, cereal or seed) (8%)

• Chocolate-coated waffles/wafers (8%)

• Kerosene (4%)

• Fertilisers (between 2-6.5%)

This is the second government-led cost-of-living tariff package this year, following an initial package introduced in June 2026 covering products including pasta, fruit juice and tuna. Together, the two packages are expected to reduce consumer costs by approximately £245 million to £595 million a year.

Separately, the government introduced a business-led package in July following applications from firms and is now extending existing business suspensions, while opening a new application window for further products.

Post Office:

The rollout of self-service parcel Drop Boxes is already under way, with 500 set to be in place by the end of this year and 1,000 by the end of the financial year. In addition, 600 Post Office branches will benefit from upgrades by the end of the financial year.

On the Warm Homes loans scheme, government support will reduce the cost of borrowing, helping households spread the upfront cost of improvements that can deliver long-term savings. Installing a heat pump, battery and solar panels could cut energy bills by up to £550 a year, with further potential savings from a time-of-use tariff.

Tags

More Like This

Millions to benefit from lower travel and food costs

Budget marks first step in plan to drive up opportunity and drive down poverty

Strong foundations, secure future: a Budget that delivers on the country's priorities

Budget 2025 fact sheet: Cutting the Cost of Living

Help with the cost of living in 2026

Reeves tackles cost-of-living and backs Welsh industry at Budget

Three ways the Budget will put more money in working people’s pockets

Millions more families to get £150 off energy bills this winter