Chancellor of the Exchequer John Healey delivered his first Budget on Wednesday 28 October 2026. If you missed it, here’s top five takeaways and what they could mean for you.
There were a series of targeted announcements which aim tackle some of the biggest challenges of our time, such as an extra £432 million to end rough sleeping for the rest of this parliament. This was also cited as an example of a more preventative approach in government, and its clear form the pre-Budget engagement with civil society organisations on this issue that the government really believes in the role charities will play in achieving this.
There was additional funding to build more social and affordable homes and to support local growth efforts. Support for household energy bills will also offer some much-needed relief. And there were some smaller but meaningful measures of help too - such as £15m investment into children's reading and £55m to support halving violence against women and girls.
The government confirmed that the final report of the Milburn Review into the NEETs (Not in Education, Employment or Training) crisis, is coming next month.
Their response will follow later this year, leading to a White Paper in early 2027 and legislation further down the line. Civil society will need to play an important role in overcoming the challenges young people face.
One of our key messages to the Treasury was for them to see civil society as a major economic force in its own right. However, the Budget had little to demonstrate that or support civil society to unlock its full potential in contributing to growth in every postcode.
Government can’t achieve its national growth targets without us. They must use the Civil Society Covenant and Council to properly weave charities into its growth agenda.
We’ll be working hard in the coming weeks and months to ensure this features prominently in the 10-year plan and Spending Review.
This Budget could have gone further in recognising the systemic challenges facing the voluntary sector by providing the support it needs to remain resilient. This is especially true for those organisations delivering vital public services,. They'll likely not receive the necessary uplifts to grants and contracts to cover the increasing cost of delivery from higher national living wage and minimum wage rates.
We’ll continue to push for full cost recovery, and deepen understanding within government of the impact increased costs has on a sector that can’t “pass on” costs.
Long term sustainable funding is also vital to giving charities certainty to plan and headspace to innovate and deliver. We need to move away from one-year funding cycles to three to five year commitments as standard.
We raised this with the Treasury and highlighted instances of councils with three-year contracts in place for waste, but only one-year commitments to children’s services.
Where we know statutory services delivered by charities will always exist, we need to ensure that the Treasury can give confidence to local governments to hand out longer term contracts.
The government has announced plans to protect funding for services that prevent problems from becoming more serious, rather than focusing only on responding to crises. This could create opportunities for charities delivering preventative services, although the details won’t be confirmed until the 2027 Spending Review.
We welcome this announcement and will continue to push for charities to be involved in shaping how this approach works in practice.
The Budget set out “a roadmap to fiscal devolution, the biggest transfer of power and resources out of Whitehall in a generation”. This will see greater powers for mayors alongside initiatives like Good Growth Funds to support local economic priorities and development.
We were also pleased to see an extra £5 billion allocated to the British Business Bank, including £165 million earmarked for community lenders.
These steps have the potential to spur new growth and build fairer local economies, but only if regional leaders tie this to deep and meaningful partnerships with their civil society ecosystems. Devolution will only work if local communities and their citizens have a seat at the decision-making table.
The principles of the Covenant need to trickle down with the funding, with greater involvement and engagement with local infrastructure, to ensure local decisions are made in partnership with local voluntary sector leaders.
The Budget offered some welcome ambition on prevention, devolution and tackling entrenched social challenges. But it fell short of recognising civil society as an essential partner in delivering that ambition and of addressing the immediate financial pressures threatening charities’ ability to do so.
There’s a fundamental disconnect here. Government can’t build a more preventative state, strengthen local economies or improve outcomes for communities without the organisations already working at the heart of them.
Charities can't deliver more with less indefinitely. Rising costs, short-term funding and contracts that fail to cover the cost of delivery are undermining the very capacity government will need to achieve its goals.
As attention turns to the government’s 10-year plan and next year’s Spending Review, we'll continue to make the case for a different approach: one that recognises civil society as an economic and social asset, provides charities with the sustainable funding they need, and involves them in decisions from the outset.
The opportunity is there. The question will now be whether government turns its ambition into a genuine partnership with civil society, and backs that partnership with the resources, relationships and long-term commitment needed to make a difference.
