Budget 2026: Breathing space for Scottish families and businesses?

Energy costs lowered as home heating oil tariffs removed and 0% VAT on household electricity extended.
Growth backed with investments in Glasgow and Edinburgh.
The Scottish Government will have an additional £600 million for public services.

Families and businesses in Scotland will get breathing space from action announced in Budget 2026.

Against a backdrop of global uncertainty, rising energy costs and pressure on household finances, Chancellor John Healey has taken action on the cost of living, fuel prices, and local jobs — alongside more funding for the Scottish Government to provide public services.

In the Budget, John Healey announced:

Support with energy bills: The removal of the 4% tariff on kerosene will support the 142,000 Scottish households that rely on heating oil. The UK government will extend 0% VAT on household electricity bills for three months, to 30 June 2027, while a Debt Relief Scheme will write off crisis-era debt for eligible households.
Fuel: the extension of the 5p cut to fuel duty for a further six months until 30 June 2027. The 3.7p cut to red diesel duty continues, which matters for farmers, rural hauliers and other fuel-heavy users across Scotland. He also announced a permanent increase to the generosity of mileage rates to support those who drive for work.
Food prices: Tariffs axed on over 100 food products, including chocolate and fruit juice. Combined with tariff suspensions earlier this year, this will save households up to £21 annually.
Pensions: by the end of this Parliament, 93,000 low-income pensioners in Scotland will pay less tax or none at all on their income, as a result of reducing the disproportionate administrative burden of paying small amounts of tax. 
Wages: Increasing the National Living Wage by 3.9% to £13.21 per hour and the National Minimum Wage by 3.9% to £11.27 per hour for 18 to 20-year-olds and by 3.9% to £8.31 per hour for 16 to 17-year-olds and eligible apprentices. An estimated 180,000 workers in Scotland saw a direct pay rise following April 2026’s increase to the National Living Wage and National Minimum Wage.

Backing growth in Scotland

The establishment of a new Energy Wealth Fund to support Scottish clean energy jobs way into the future.
£18 million will fund a UK Advanced Chip Design Academy led by the University of Edinburgh, building on Scotland’s strengths in advanced technology.
£6 million will expand Glasgow’s Scottish Event Campus (SEC), subject to business case, allowing the venue, which hosted COP26 and the Commonwealth Games, to go bigger and better.
£20 million will see the creation of two Defence Technical Excellence Colleges in the East and West of Scotland.
Extending duty suspensions for 350 goods to help businesses in the chemicals, plastics, hydrogen, automotive and food and drinks sectors.
The Budget strengthens Britain’s national security by fully funding the £15 billion Defence Investment Plan, including £4.7 billion that was previously unfunded. Defence spending supports 12,200 industry jobs in Scotland, up 7% from 2025.

Secretary of State for Scotland, Douglas Alexander, said: “This is a budget that puts money back in the pockets of Scottish households, backs businesses, and puts Scotland firmly at the heart of the UK government’s plan for growth and reindustrialisation.

“We’re helping families tackle the cost of living by cutting the standing charges from gas bills, saving households around £45 a year, then looking to remove them altogether. We’re also extending the VAT cut on energy bills, as well as removing the tariff on heating oil.

“But we’re not just easing the pressure today, we’re building Scotland’s future. £18 million for a semiconductor manufacturing research centre at the University of Edinburgh, £6 million to expand the Scottish Event Campus and grow on the legacy of COP26. That’s creating jobs and good growth in every postcode.

“There’s a boost for Scotland’s public services too, with an extra £600 million for the Scottish Government to spend.”

Funding for public services

The Scottish Government’s main source of funding comes through the block grant. This includes money collected from taxpayers across the UK – including from people in Scotland – which is then available for the Scottish Government to spend on devolved services. The Scottish Government also raises its own revenue, through the Scottish Rate of Income Tax, and non-domestic rates on businesses, for example.  

Spending Review 2025 provided the Scottish Government with their largest spending review settlements in real terms since devolution in 1998, receiving an average of £50.9 billion per year between 2026-27 and 2028-29. 

Changes in the devolution roadmap may have an impact on the funding of the devolved governments. Our approach to fiscal devolution in Scotland, Wales and Northern Ireland is already well established, however, we will engage with devolved governments on any implications for their budgets in the usual way to ensure they continue to be funded to deliver a comparable policy offer.

The Scottish Government has at least 20% more funding per person than equivalent UK Government spending in the rest of the UK. The higher amount reflects that providing services across Scotland genuinely costs more. This means that for each £1 of equivalent UK Government spending in the rest of the UK, the Scottish Government has at least £1.20 to spend per person in Scotland. 

The Scottish Government will receive an additional £600 million, on top of an additional £1.7 billion from Budget 2025 and Spring Forecast 2026.

Ian Murray MP – the MP for Edinburgh South – has welcomed cost of living support for families as the Labour Government announced its Budget today.

John Healey’s Budget provides breathing space for families by extending the cut to fuel duty and the removal of VAT from household energy bills.

It also sets out a plan to abolish gas standing charges, which will save the majority of households an average of £45 a year.

The Budget provides an additional £600mn for Scottish public services, meaning that the Scottish Government have received over £18bn in extra resources since Labour came to power in July 2024.

Across Scotland, Labour also announced it was investing in the Edinburgh-Glasgow Central Belt, a key area for world-leading strengths as identified in the UK’s Modern Industrial Strategy, through £6mn of new funding to expand Glasgow’s Scottish Event Campus (subject to business case) and £18mn new funding for a UK Advanced Chip Design Academy led by the University of Edinburgh.

Ian Murray MP said: “These are Labour decisions: backing families and businesses today while building a stronger Britain for tomorrow.

“I know people are struggling with the cost of living. I see it every day in my constituency mailbag.

“That’s why we’re extending the cut to fuel duty and the removal of VAT from energy bills, and working to abolish gas standing charges.

“It’s also why the Chancellor announced a £100 energy support payment to households in Council Tax bands A – D in England.

“That money will be passed onto the Scottish Government via the Barnett Formula. It’s now over to them to ensure the support is passed onto households here in south Edinburgh and across Scotland.”

UK Budget delivers ‘real cut’ to Scotland’s funding

JENNY GILRUTH – Action on energy bills ‘falls short of what is needed’.

The UK Budget delivers a real terms cut in Scotland’s budget of around £650 million in 2027-28, the Deputy First Minister has warned.

Scotland’s resource block grant is set to reduce by 1.3% in real terms in 2027-28, equivalent to a reduction of around £550 million. Scotland’s capital budget will see a 1.5% real terms reduction in 2027-28, equivalent to around £100 million.

The Deputy First Minister also confirmed that the Scottish Government will ensure that households in Scotland benefit from the £100 payment for energy bills support.

Jenny Gilruth said that while any measures to bring down the cost of energy bills are welcome, the steps confirmed by the Chancellor today fall far short of what is required and do not meet the promises on which the UK Government came to office.

The Deputy First Minister said: “The Scottish Government’s budget will be cut by around £650 million next year – reducing the money we have to spend on public services and supporting people with the cost of living.

“The Prime Minister has previously claimed that he would respect devolution and the Scottish Government – but his actions do not match his words. Cutting Scotland’s budget shows that, yet again, we are being treated as an afterthought.

“The Scottish Government will ensure that households in Scotland will benefit from the one-off £100 payment for energy bill support, however, it is clear that the measures announced today fall far short of the action which is required. “

“Furthermore, this support does not come close to meeting the promises on which the UK Government came to office, including reducing energy bills by £300 which remain significantly higher than they were in July 2024. The UK Government has failed to meet the moment and has failed to keep its promise.

“It is also unacceptable that there was no announcement about ending wider austerity policies which are pushing families into poverty like the bedroom tax, the benefit cap and “young parent penalty” in Universal Credit which would make a significant difference to tackling poverty.

“The Chancellor had the opportunity to lift thousands more families out of poverty, and he has chosen not to.

“We will now take the time to assess the full implications for Scotland of today’s statement.

“I will be announcing further details as part of the Scottish Budget on 3 December.”

Anti-poverty campaigners say Budget won’t share the wealth

The Poverty Alliance welcomed Budget moves to help people with rocketing energy bills – but warned they won’t go far enough to help people in fuel poverty.

Peter Kelly said: “There are nearly 750,000 households in Scotland who are in fuel poverty. The energy price cap today is £1,723, and in January it’s predicted to rise to nearly £2,000. In that context, a payment of £100 is welcome, but it won’t be enough for people who are already being pushed into debt and arrears.

“As well as looking at standing charges on energy bills, the UK Government must bring in a social tariff – making sure that no-one is hit with bills that they simply can’t afford to pay.”

Scotland’s anti-poverty network expressed disappointment at the lack of any major extra investment in social security.

Peter Kelly said: “We can’t expect people to build a life out of poverty on quicksand. When rates of Universal Credit and other social security payments are too weak to support people, it pushes them closer to destitution and makes it harder to build a better future.

“We hope that the forthcoming reviews into support for disabled people and young people have clear vision for improving financial security and investing in a stronger society for all of us.”

The Poverty Alliance also expressed disappointment over the Chancellor’s failure to tax wealth in the same way that work is taxed.

They had backed calls to equalise the way Government treats wealth and work, by bringing rates of Capital Gains Tax into line with Income Tax.

Tax Justice UK estimates the move could have raised £14 billion for the Treasury, with the Scottish Government getting over a billion pounds a year extra for its budget.

Peter Kelly said: “People are losing faith in politics because they feel that politicians aren’t working to meet their needs. Taxing wealth in the same way as work would bring in extra resources that we could invest in building a better future, and a more just and compassionate society.

“We all rely on social security and local services being there when we need them – and for people who are pushed into poverty, they are an essential lifeline.

“The money raised from fairer taxes on wealth could have been used to take more children out of poverty.”

STUC: Budget provided sticking plasters when Scotland needs radical surgery

Reacting to the UK Government’s Budget, STUC General Secretary Roz Foyer said: “We always knew exorcising the ghost of Thatcher and eradicating 40 years of neo-liberalism was going to be a tall order for the Chancellor and there are some welcome tricks in the Budget, but not enough to scare away fears of rising costs.

“Whilst this Budget offers some helpful sticking plasters on energy costs, cost-of-living support and food prices, it falls short of the radical surgery needed to fix the UK economy and support working-class communities. Perhaps most significantly, the Budget failed to set out the radical rewiring of the state and the end to neo-liberalism that the Prime Minister himself had promised.

“Payments to stave off the cold for those in targeted council tax bands are a good first step in lieu of bringing down wholesale energy bills and it is right that the Chancellor has listened to the calls of unions to tax the banks to fund this measure. However, bills are likely to rise far quicker than this payment can offset and we will continue to press the UK Government to go further and faster, given the ‘big four’ banks made £29 billion in the first six months of 2026 alone

“With an expected £600 million allocated to Scotland, Scottish Government ministers cannot credibly sit on their hands and plead poverty. The Scottish Government should urgently review its public sector cuts agenda in light of this Budget.

“Rewiring the state will take longer than just one Budget and changes to procurement rules which strengthen British jobs and domestic supply chains are to be welcomed.

“The commitments made on defence spending require further examination, but unions are clear that funding for defence cannot come from public sector efficiencies. Co-funding for Defence Technical Excellence Colleges (DTECs) in both the east and west of Scotland is welcome and should help provide well-paid, unionised jobs.

“This Budget doesn’t yet offer the concrete reindustrialisation Scotland needs, nor the further devolved powers for our Parliament and local authorities that had been envisioned. The Prime Minister must work at pace to show that his words on ensuring communities are empowered from the bottom-up, rather than the top-down, were not hollow.

“Workers can ill afford any further delay to the hope that was promised to them.”

Responding to Chancellor John Healey’s Autumn Budget, Morgan Vine, Director of Policy and Influencing at Independent Age said: “Today’s Budget made some important commitments that will play a part in easing the financial burden on people of all ages, including those in later life that Independent Age supports.

“We’re pleased to see changes we’ve campaigned for, alongside older people on low incomes, including protecting the poorest pensioners from tax bills as their State Pension increases – a decision that will help current and future pensioners. And some support for energy customers to ease spiralling bills, including providing £100 directly to households in England’s higher council tax bands (A-D) through the Household Energy Payment scheme.

“However, some serious problems remain unaddressed. We believe the UK Government can go further to tackle key areas driving financial hardship across all generations. Every day we hear from older people on low incomes who are cutting back on food, living in cold homes, or skipping showers to keep their bills down. This is no way to live.

“Frozen Local Housing Allowance that keeps private renters of all ages stuck in poverty needs to be uprated to reflect the true cost of renting. We need long-term action to protect the poorest households from the frequent energy price shocks driving up bills with the introduction of a comprehensive and well targeted energy social tariff. And, to lift people out of water poverty, a single social tariff for water is needed across England and Wales to end the postcode lottery of support.

“We will continue to stand alongside older people on low incomes, and work with the UK Government to build on the positive steps taken today.”

Helen Barnard, director of policy and research at Trussell, said: “We are disappointed that the government has not acted today on one of the biggest pressures facing low-income renters.

“We welcome seeing the significant support provided for people’s energy bills, which will make a real difference as the colder months draw in. However, the decision to keep housing support for private renters on low incomes frozen is a misstep that will continue to drive people towards homelessness and to the doors of food banks.

“We know from our research that over half of private renters on low incomes in receipt of Local Housing Allowance to help pay their rent, have run out of food in the last 12 months and haven’t been able to afford more. Nobody should be forced to choose between paying the rent and putting food on the table. But for increasing numbers of UK renters this is already a bleak reality.

“If the Chancellor is serious about tackling the cost of living, the best test will be whether fewer people need to turn to a food bank because they can afford the essentials like rent, energy bills and toiletries.

“The government has already taken bold steps towards this, including by lifting the two-child limit, However, unless we see action to close the gap between support and essentials like rent, the UK government will fail to meet its manifesto promise to end the need for emergency food.”

Amie, 45, who has experience of turning to a food bank, said: “Every week I’m forced to choose between keeping a roof over my head or putting food on the table, even though I work – just like so many people on the lowest incomes. As the cost of rent has skyrocketed, I had hoped the Chancellor would see sense and unfreeze Local Housing Allowance today so it actually meets the costs of renting a home.

“The extra help with energy bills announced today will help but I’m disappointed the government hasn’t chosen to act on the biggest problem my family is facing, which is keeping a roof over our heads.

“I don’t struggle to pay for our housing because I can’t budget, I struggle because the cost of my rent keeps rising far beyond what I can pay and the support just isn’t there. That leaves families like mine constantly having to make impossible decisions.

“Tomorrow I’ll still wake up worrying about the same things I’ve been worrying about for months. How am I going to cover the rent? Will there be enough left for food? Those are the questions families like mine will still be asking.”

Commenting on the UK Government’s Budget announcement, COSLA Resources Spokesperson Councillor Kelly Parry said: “Councils are central to local economies, tackling child poverty, and delivering key community services.

“For this reason, the elements of the UK Budget that signal further devolution of power are encouraging, however single-year budget settlements from UK Government and Scottish Government are still not allowing councils to achieve their full potential.

“As we look ahead to the Scottish Government’s Budget on 3rd December, it is vital that Ministers prioritise local government with a fair, flexible, and sustained funding settlement.

“Removing ring-fencing and single-year budget constraints will empower councils to invest in preventative services and deliver real, long-term change for our communities.”

Budget to give Britain breathing space today and fresh hope for the future

Today (Wednesday 28 October), the Chancellor will set out how the Budget will make Britain “more resilient” to global shocks, while helping households with “everyday costs”, backing businesses and entrepreneurs, and kicking off the “long-term action” needed to get “energy costs down for good”

In a video message, the Chancellor of the Exchequer, John Healey said: “Breathing space for today and fresh hope for the future. That’s what today’s Budget will deliver.

‘The world’s a highly uncertain place. Conflicts abroad are pushing up energy prices, and the cost of living here at home – piling pressure on the families, on businesses, and on our public finances.

‘But Britain’s economy is showing real signs of resilience: investments up, productivity is growing, and we had the joint fastest growth in the G7 in the first half of this year.

‘We can’t stop these shocks that hit Britain, but we can make Britain more resilient when they do.

‘So, this Budget is designed to give households breathing space from some of the everyday costs, provide targeted support for businesses and self-employed people, and to start the long-term action needed to get energy costs down for good.

‘But breathing space today must go hand-in-hand with building for the future.

‘So, we’ll back British businesses and entrepreneurs, we’ll invest in the technologies that drive future growth, and we’ll build more homes, shift power out of Whitehall, so that leaders locally can drive growth in every postcode.

‘And in an uncertain world, we will strengthen national security and our defences, as well as our support for Ukraine.

‘We’ll do all of this responsibly, sticking within tight fiscal rules, and make sure every pound is well invested.

‘Because this Budget is about getting through this difficult moment. But it’s also about putting Britain on a future path, a better future path.

‘Breathing space today, and fresh hope for the future.”

Chancellor abolishes standing charges on gas bills to make payments fairer

Standing charges from household gas bills will be removed for around 23 million homes.
Action from the Chancellor and Energy Secretary will make the energy system fairer and give some families breathing space.
Budget will “draw a line in the sand” on energy policy that has left billpayers exposed, giving families breathing space for today and hope for the future.

Tens of millions of households will no longer pay standing charges on their gas bills as the Government gives families more control over what they pay and some more breathing space.

A standing charge is a fixed daily fee added on top of a household gas bill, regardless of how much gas has been used. A household could use no gas at all but still must pay the standing charge.

The Chancellor will announce today an end to this unfair and outdated practice. He will ask Ofgem to deliver removal of these charges – which are £108 a year for the typical household on average – in 2027 or as soon as possible after.

Instead, these fixed costs will be paid on the unit rate, which could save 60% of account-holding households around an average of £45 off their annual bill.

Households not seeing an automatic saving will still have better control over their bills without the worry of affording the standing charge, and the government will set out in due course targeted mitigation for a small number of households.

This comes ahead of today’s Budget that will “draw a line in the sand” on a UK energy policy that has seen wrong turns taken for over four decades. The Prime Minister has previously spoken about reforming a broken energy market, so it better serves the public interest, rather than piling costs to bills and leaving British households even more exposed in an uncertain world.

Prime Minister Andy Burnham said: “Abolishing gas standing charges is about basic fairness and giving people more control over their bills.

“I am determined to reform our broken energy market, so it better serves the public interest.”

Chancellor of the Exchequer John Healey said: “Gas standing charges are unfair and outdated so I am scrapping them to give millions of households a bit of breathing space.

“My Budget will draw a line in the sand on an energy policy that has failed British billpayers for years, letting extra costs on bills pile high and leaving households even more exposed to global shocks.”

Energy Secretary Miatta Fahnbulleh said: “Too many families face unfair charges, so we’re making it easier for people to take control of their energy bills.

“By removing one of the nation’s bugbears – taking standing charges off gas bills, with extra support for those who need it – we’ll give millions of people breathing space.

“Tackling affordability is my number one priority, and I will keep doing everything I can to protect people from unaffordable bills.”

Greg Jackson, Founder and CEO of Octopus Energy Group, said: “This represents real joined-up thinking to make a fairer, more efficient energy system, delivering what customers want – lower standing charges and further improving the ratio of electricity to gas prices.

“Most customers would see a cut in their gas bills which is crucial, but would also enjoy even higher savings if they can move to heat pumps when it suits them.”

This follows the Government’s VAT cut on electricity bills that came into effect at the beginning of this month which is already supporting households.

It means the Energy Price Cap from October was £45 a year less than it would have been. Around a third of households on fixed tariffs are not affected by the price cap, meaning their electricity prices will have fallen when the VAT cut took effect.

While the government is giving people short term relief on their energy bills, it is also taking action to fix Britain’s energy problems for the long term.

Last week, the Government announced a new Energy Wealth Fund which will support investment in cheap, clean power.

Hatchet Man Healey takes axe to delays holding back growth

Chancellor John Healey has set out his plan to drive growth in every postcode, backing Britain’s extraordinary strengths to deliver benefits across the whole country.
New ambition to double the number of UK unicorn firms in clear signal of ambition for British economy, alongside powers which will help businesses test and scale technologies from delivery robots to medical treatments.
Northern 500 initiative and £150m British Business Bank fund to back high-growth firms across the North.

Speaking at the Manufacturing Technology Centre in Coventry today (Monday 7 September), the Chancellor laid out how he will take an axe to delays holding back growth, from backing British business and giving local leaders more power, to clearing away the delays that hold back investment.

Changes to the judicial review process for Nationally Significant Infrastructure Projects announced today will fix a system where every decision can face another challenge, consultation or review before a single brick is laid or a spade enters the ground.

Sending a clear signal on his level of ambition for UK business, he also set a goal to double the number of unicorn firms – companies valued at over £1billion – in the UK.

The Government will work with the Business Department to identify the next generation of high-growth companies and help them overcome regulatory barriers, access capital, and win government contracts as an early customer.

And he announced the Northern 500: which will bring together 500 of the North’s most ambitious mid-sized businesses into a single growth community led by the Great North partnership of Mayors and supported by the private sector and central government.

Chancellor John Healey MP said: The UK is the third in the world for innovation. Our record is extraordinary… But too often, ideas born here in Britain have to go elsewhere to find the capital they need to grow…

“I’m setting an ambition to double the number of unicorn firms in this country. Together, with Johnny Reynolds I will identify the next wave of unicorns, with the state as an early first customer to ensure they have the necessary backing to scale.”

The Chancellor also committed to delivering new powers to oversee ‘sandboxing’ that will be ready to deploy next year. Sandboxing is the term for how companies and regulators can work together to test new models or features in safe and controlled environments.

The new powers, to be delivered through the Business Department’s Regulating for Growth Bill, will let businesses test cutting-edge products and technologies safely, establish what works and scale more quickly.

Potential use cases of these new powers include patient access to innovative treatments, rollout of delivery robots, defence technologies or maritime autonomous vehicles.

Today’s speech also set out reforms to tackle the bureaucracy holding back growth and investment, putting decision-making back where it belongs and helping ensure people in every postcode benefit from a government focused on delivery.

Chancellor John Healey MP added: I will take an axe to the thicket of consultation, litigation and administration that has a stranglehold too often on private investment.…

“And let me say this – the people who elected this government expect us to get on with it. The role of government is to act.

Judicial review challenges typically delay nationally important infrastructure projects by a year and a half. For example, Sizewell C was delayed by two judicial reviews, both of which ended up being dismissed by the courts, delaying the delivery of clean power to the equivalent of six million homes and 10,000 jobs at peak construction.”

The Chancellor has also instructed the Government to embrace risk when it needs to in order to get things done. Under the current system, decisions have been held back, for example:

Despite 99% of respondents to a Call for Evidence supporting microchipping cats in the same way as dogs in 2019, it took nearly 5 years to make it happen: one call for evidence, two further consultations, legislation through Parliament and then finally enacted in June 2024.
The planning process for East West Rail began in 2019 and has already involved four rounds of public consultation in 2019, 2021, 2024 and 2026. And it could still face more challenges before getting over the line

That’s why from today, Ministers have been told that public consultations are not always required and have encouraged departments to find other ways to get views from the public and experts when developing policies.

The reforms support the Prime Minister’s drive for a faster, more effective state through No10 North, which brings together decisionmakers from across government to accelerate growth and strengthen delivery. 

The Treasury and No10 North have been working in lockstep and directly with departments to identify where projects are stalling, why, and which changes to law, regulation or process are needed to get them moving again.

The reforms also reflect lessons from the Fingleton Review, which highlighted how excessive risk aversion and slow decision-making can hold back the delivery of major infrastructure projects.

To tackle delays holding back growth and investment, the Government will introduce a package of reforms to give parliament the ability designate and approve the country’s most important infrastructure and give them significant enhanced protection from legal challenge, reduce unnecessary consultations and reporting requirements, ensure legal challenges are raised and resolved earlier, and make clear that legal risk should inform ministers’ decisions, not dictate them.

Together, the changes will help deliver major projects more quickly while strengthening democratic accountability and giving greater certainty once decisions have been taken.

The Government will also launch a review of the costs of rail infrastructure in the UK in the coming weeks, to identify further practical reforms to radically cut the costs of delivering new rail infrastructure in the UK.

Together, these measures will help build a state that delivers rather than delays, giving government greater confidence to act and ensuring approved projects can move forward more quickly.

The reforms form part of the Government’s wider mission to drive good growth in every Postcode, unlocking the investment needed to create opportunities across the country.

They are a key step in realising No10 North’s focus on stripping away the administrative sludge that has built up around government, restoring democratic accountability and replacing a culture of process with a culture of delivery. 

No 10 North will continue working with the rest of government to identify further blockages in the months ahead.

Thousands of new jobs and more than £18 billion boost to British economy as PM meets Japanese leader

The UK and Japan are expected to agree investment creating tens of thousands of new jobs and more than £18 billion in economic gains, alongside a new partnership at the forefront of next-generation technologies

UK and Japan unlock significant inward investments totalling more than £9 billion in infrastructure and financial services and up to £9 billion in offshore wind.
New technology partnership will accelerate cooperation on cutting-edge tech including AI, semiconductors, and quantum computing.
Visit drives forward partnership with UK’s closest security partner in Asia, marking a step change in the UK–Japan relationship.

The UK and Japan are expected to agree investment creating tens of thousands of new jobs and more than £18 billion in economic gains, alongside a new partnership at the forefront of next-generation technologies.

Together the deals will back British industries across technology, clean energy, infrastructure development, and life sciences, supporting long-term growth across the country. These are sectors at the heart of the UK’s Modern Industrial Strategy and building on a relationship with Japan already worth £140 billion.

The Prime Minister welcomed his Japanese counterpart Sanae Takaichi to Downing Street yesterday [Sunday] ahead of the G7 in Évian-les-Bains.

Japanese and British business leaders will join the two prime ministers for a roundtable discussion on future opportunities for economic growth where over ten commercial and government agreements are expected to be signed.

The visit delivers a major vote of confidence in the UK economy, with Japanese investors setting out a five-year investment pipeline worth more than £9 billion, expected to build new towns and provide high-quality office space and innovation hubs.

Prime Minister Keir Starmer said: “These landmark agreements will bring multibillion pound investment into the UK, creating tens of thousands of new jobs and driving new developments.

“As G7 economies and close security partners, we are working together with Japan on some of the most innovative technology in the world, harnessing the best of British and Japanese research and industry to deliver growth and security to every corner of the United Kingdom.”

At the heart of the visit will be a landmark Offshore Wind Compact, developed in close partnership with Great British Energy to unlock up to £9 billion in Japanese investment into the UK’s offshore wind sector.

It will support the development of 5.9GW of floating offshore wind projects in the UK, including the Ossian and Green Volt projects off the East Coast in Scotland alongside the Erebus project in the Celtic Sea.

These pioneering projects will support jobs across the country, and when built, generate enough clean electricity to power 8 million homes.

By boosting homegrown clean energy, the deal will help reduce reliance on volatile global fossil fuel markets, strengthen energy security, help get bills down for good, and makes the UK Japan’s leading clean energy partner in Europe.

Hitachi Energy UK is set to create at least 500 new jobs over the next five years, providing vital expansion of the UK grid and bringing clean power that delivers growth. This includes 100 highly skilled roles at Hitachi Energy’s newly opened Glasgow Centre of Excellence, and over £18 million investment in a purpose-built facility in Stafford.

Meanwhile, Rolls-Royce will deepen collaboration with Japan’s Atomic Energy Agency signing a new agreement with the UK National Nuclear Laboratory to develop next generation nuclear technologies. And our national laboratories (UKAEA and QST) and leading private companies will deepen their collaboration on fusion energy.

Communities like Hatfield are set to benefit from the package of deals, where Japanese life science firm, Eisai, is set to invest £48 million. The investment will create a new packaging facility for its innovative dementia treatment, backed by government funding. 

The leaders are also expected to agree a new partnership to accelerate cooperation on the technologies of the future. The cutting-edge UK-Japan Frontier Tech Partnership (FTP), will see British research translated into scalable technology with Japanese investment, from AI and quantum, to civil nuclear and defence tech.

Building on momentum from London Tech Week, the FTP will deliver groundbreaking impact for the UK and Japan. This includes British firm ORCA Computing landing a landmark export deal – one of the first times a major corporation anywhere in the world has bought a quantum computer.

For the first time, a formal partnership between the UK Semiconductor Centre and Rapidus, Japan’s state-of-the-art manufacturing facility, creates a direct pathway for the UK semiconductor sector to manufacture cutting-edge chips used to power mobile phones, vehicles and modern devices.

During the meeting, the Prime Ministers are expected to confirm their shared commitment to the Global Combat Air Programme, and discuss the launch of the next phase of the international programme, including through the international contract that will be signed by the end of the month.

A new Defence Capability and Industrial Council will foster greater industrial cooperation between the UK and Japan, accelerating the development of each other’s dual-use technologies such as drones and artificial intelligence, helping UK defence firms access significant Japanese investment.

G7 Foreign Ministers’ statement on support to partners in the Middle East

Joint Statement from the G7 Foreign Ministers of Canada, France, Germany, Italy, Japan, the UK, the USA and the High Representative of the EU

We, the G7 Foreign Ministers of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States of America, and the High Representative of the European Union, express support to our partners in the region in the face of the unjustifiable attacks by the Islamic Republic of Iran and its proxies.

We condemn in the strongest terms the regime’s reckless attacks against civilians and civilian infrastructure, including energy infrastructure, in Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates, Jordan, and Iraq, in line with UNSC Resolution 2817.

The Iranian regime’s unjustifiable attacks against these states also threaten regional and global security. We call for the immediate and unconditional cessation of all attacks by the Iranian regime.

We reaffirm the importance of safeguarding maritime routes, and safety of navigation, including in the Strait of Hormuz and all associated critical waterways, as well as the safety and security of supply chains and the stability of energy markets. We stand ready to take necessary measures to support global supply of energy such as the stockpile release decided by International Energy Agency members on March 11.

The G7 has repeatedly stated that Iran must never obtain a nuclear weapon and that it must halt its ballistic missile program, end its destabilizing activities in the region and around the globe, and cease the appalling violence and repression against its own people.

We support the right of the countries unjustifiably attacked by Iran or by Iranian proxies to defend their territories and protect their citizens. We reaffirm our unwavering support for their security, sovereignty, and territorial integrity.

We condemn the brazen attacks in Iraq by Iran and its militias against diplomatic facilities and energy infrastructure, particularly in the Iraqi Kurdistan Region, and against U.S. and Counter ISIS Coalition forces, and the Iraqi people.

Scotland’s first Center Parcs to create 1,200 jobs

New holiday resort in the Scottish Borders

Scotland’s first Center Parcs resort will create 1,200 permanent new jobs First Minister John Swinney announced today, as he visited the site near Hawick in the Scottish Borders where the resort will be built.

The Scottish Government has committed up to £30 million over five years to deliver the essential infrastructure needed to make the resort possible. The funding, which will be delivered via South of Scotland Enterprise, unlocks more than £420 million in private funding from Center Parcs, which could not proceed without it.

Work is expected to begin on site in spring 2026, with the resort set to open in summer 2029. The development is expected to increase tourism to the area by 38%, generating £87 million annually for the Scottish economy.

The resort will offer families across Scotland a high-quality staycation option closer to home, reducing the need to travel abroad for short breaks.

First Minister John Swinney said: “Economic growth must reach the people and places that need it most. Investing in the South of Scotland through this project is a direct expression of our belief that every part of Scotland deserves to benefit from a growing economy.

“Investing here is a deliberate statement that we are serious about reducing regional inequality and creating genuine opportunity for young people — 30% of these 1,200 jobs are targeted at 16-to-24-year-olds.

“It is a privilege to be here with local school children to start planting new trees for the site and I look forward to seeing the development of the project before the resort opens in 2029.”

Center Parcs CEO Colin McKinlay said: “We are very grateful for the support of the Scottish Government, as well as South of Scotland Enterprise, Scottish Borders Council, and the many other partners who have worked with us to unlock the potential of this project.

“Center Parcs will have a transformational effect on the South of Scotland, bringing jobs, tourism, supply chain opportunities and significant economic benefits. It is incredibly exciting for work on site to now be getting underway and we were delighted that the First Minister could join us to commemorate this key milestone.”

Chair of South of Scotland Enterprise Russel Griggs said: “This is a significant moment for the South of Scotland, with Center Parcs being one of a number of big investments we are currently welcoming to our region.

“Center Parcs presents massive opportunities and will help diversify the visitor economy, attract new people, deliver inclusive growth and provide significant supply chain opportunities for SMEs and entrepreneurs.

“This investment also provides a chance to tackle head-on the economic challenges of the past which still impact communities such as Hawick.”

Planning permission for Center Parcs was granted by Scottish Borders Council in December 2025.

Bank of Scotland announces £2.5 billion new finance commitment for businesses in Scotland

Over £2.5 billion of new finance can be available to businesses across Scotland in 2026, helping them grow, invest and create new jobs.

This forms part of Lloyds Banking Group’s plan to make over £35 billion of new finance available to companies operating and investing across the UK in 2026.

Businesses look to invest and grow in 2026

New research from Bank of Scotland’s Business Barometer reveals Scottish businesses identified their top target areas for growth as introducing new technology such as AI, automation or digitalisation (51%), investing in their team such as training (35%) and entering new markets (32%) in the next six months.

Martyn Kendrick, Scotland Director at Bank of Scotland Commercial Banking, said: “Bank of Scotland is proud to make £2.5 billion of new finance available to local firms in Scotland, helping them grow their businesses, invest in innovation and create new jobs.

“Whether it’s supporting a small company taking its first step into exporting, or a larger firm scaling up to meet growing demand, we’re committed to helping businesses turn their potential into growth.”

This comes as Lloyds and CBI convene business leaders, policymakers and experts from across the financial services sector in Scotland to explore how to drive sustainable growth under the UK’s Industrial Strategy.

Backing ambitious businesses across Scotland

Organisations across Scotland are already benefiting from Bank of Scotland’s support. Albyn Housing Society, one of the largest housing associations in the Highlands, has received a £10 million funding package.

The business has begun work on the first 125 homes as part of its mission to build 600 affordable homes over the next five years.

The development responds directly to Highland Council’s 2024 Housing Challenge, which calls for 24,000 new homes to be built across the region by the end of the decade.

Andrew Martin, Executive Director at Albyn Housing Society, said: “Albyn was established over 50 years ago to provide housing for workers at the Invergordon smelter.

“While the challenges have changed, our purpose hasn’t. We’re here to make sure people across the Highlands have access to good, affordable homes in the communities they live in.

“Our five-year plan is ambitious, and it reflects what local people have told us they need. Support from Bank of Scotland means we can start right away – putting plans into action and delivering the kinds of places people want to live.”

Tracy Gilbert MP welcomes £921 million additional funding for Scotland in Spring Statement

Tracy Gilbert, MP for Edinburgh North and Leith, has welcomed the Chancellor’s confirmation that the Scottish Government will receive an additional £921 million in funding through Barnett consequential in the Spring Statement.

Since the General Election in July 2024, the Scottish Government has received nearly £12 billion in extra funding.

Commenting, Tracy Gilbert MP said: “The Scottish Government has received £12 billion in additional funding since 2024. People in Edinburgh North and Leith will rightly ask what that money has delivered for them.

“With pressures on our NHS, housing and local services, this funding must be used to improve people’s day-to-day lives. It’s time to focus on getting the basics right and delivering for communities across Scotland.”

Letter: Fair Energy Pricing for Scotland

END THE ONE-SIZE-FITS-ALL MARKET

Dear Editor,

Scotland is in the absurd position of producing more electricity than we need, while families and firms here face some of the highest bills in Britain. Fuel poverty is rampant, reaching nearly 50% in the northernmost parts of the country, despite Scotland’s renewable capacity only set to grow, with projects like Berwick Bank expected to generate power for more households than exist in Scotland.

One practical approach is zonal pricing, setting electricity prices by geographic region so that areas with abundant local generation benefit from lower supply costs and reduced transmission costs.

In plain terms, power produced on and off Scotland’s shores should not cost Scottish households and businesses a premium once it reaches the meter.

Zonal pricing reflects local supply and demand, and recognises that the real expense lies in grid infrastructure, pylons, cabling, and reinforcement, rather than in “sending” electrons down the line.

Instead, we are currently being forced to accept a vast expansion of pylons across our land because the grid is inadequate for the volume of generation, with “curtailment” running into billions, paying wind operators to switch off while consumers still pay through the nose.

A new pylon network is planned from the north of Scotland down the east and through the Borders to supply demand further south, bringing long-term visual and environmental damage, disruption to arable land and watercourses, and little or no benefit to the communities affected.

As an ALBA Glasgow List Candidate, I, Dhruva Kumar, am calling for a fair deal, implement zonal pricing so Scots can finally share in the value of the energy we produce, cut fuel poverty in a cold country, and make Scotland competitive again for manufacturing, hospitality and the green supply chain.

If Westminster will not act, then Scotland’s councils and government should refuse consent for pylons that export our energy while leaving our people paying the price.

Yours faithfully,

Dhruva Kumar

ALBA Party, Glasgow List Candidate

Depute Convenor, ALBA Glasgow

Foysol Choudhury calls for small business support

Foysol Choudhury has warned that rising business rates and limited government backing are placing increasing strain on small, community-driven businesses.

Following a visit to Time Twisters Edinburgh in Sighthill on Monday, Mr Choudhury met founder Andy Hixon and staff to see first-hand how the business supports young people, creates jobs, and brings learning to life for school pupils.

He praised the company’s work supporting young people and said more must be done to protect businesses that deliver real local impact.

Time Twisters delivers hands-on educational experiences linked to the Scottish Curriculum, giving students the opportunity to explore Ancient Egypt in an interactive and engaging way.

Founded 20 years ago, the business now employs 23 people and has helped hundreds of young people take their first steps into work, often offering their very first job opportunities.

Speaking after the visit, Foysol Choudhury MSP said: “Time Twisters is a brilliant example of how small businesses can inspire young people, create local jobs, and strengthen communities. But right now, too many businesses like this are being pushed into survival mode.

“The last two budgets have made it harder than ever for small businesses to thrive. Instead of investing, expanding, and creating more opportunities, many are simply trying to stay afloat.

“These pressures are hitting the hospitality and leisure sectors particularly hard, sectors that should be driving local regeneration and economic confidence, not being held back.”

Mr Choudhury reaffirmed his commitment to supporting local enterprises and called for policies that enable businesses like Time Twisters to continue contributing to the community and the local economy.