Five groups who 'lost out' in Budget with one left absolutely 'furious'

Five sectors have been warned they have "lost out" as a result of the new Labour Party government Budget. Social care, parents of low-incomes whose children have been dragged into child poverty, farmers and more are among the list.

Local authorities got a £600m injection of funding for social care, which the Local Government Association said would would help “meet some – but not all – of the significant pressures in adult and children’s social care and homelessness support”.

But experts are warning more support is needed. And farmers, meanwhile, are furious over a potential inheritance tax raid. National Farmers’ Union president, Tom Bradshaw, blasted: “Before the election Keir Starmer promised to establish a new relationship with farming and the countryside. Well, he’s certainly done that.”

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Bradshaw said: “It’s clear the government does not understand that family farms are not only small farms, and that just because a farm is a valuable asset it doesn’t mean those who work it are wealthy. Let’s not sugar-coat this, every penny the chancellor saves from this will come directly from the next generation having to break-up their family farm.”

Social care

The Health Foundation thinktank said: “While we welcome the additional £600m for social care and the reforms to carers allowance, the continued silence on wider social care reform is disappointing.” The sector will also be hit hard by the government’s rise in employer national insurance contributions, it has been warned.

Key plans, including the NHS Mandate and the 10-Year NHS Plan, are yet to be published. Additionally, some election pledges, such as improvements in dental care access, were not addressed in this budget.

Child poverty

The current child benefit system provides financial support to parents and guardians. For the 2024/25 tax year, payments are £25.60 per week for the eldest or only child and £16.95 for each additional child. Eligibility for the full amount applies if both partners earn less than £60,000 annually, a threshold recently increased from £50,000.

The HICBC affects those earning over £60,000. For every £200 earned above this threshold, one per cent of the benefit must be repaid. At £70,000, half the benefit is repaid, and at £80,000, the entire benefit is wiped out.

Becca Lyon, head of UK child poverty for Save the Children UK, said: "This Budget is the start of more ambitious support after rising child poverty rates, so we welcome investment in breakfast clubs, SEND provision and reducing debt repayments for families on Universal Credit. Yet it was a mistake not to scrap the cruel two-child benefit limit despite widespread calls to end this outdated policy. That means 1.6 million children in larger families will still be suffering the consequences of less money for food, clothes, toys and books.

"The UK Government's on-going Child Poverty Strategy gives us hope for the future, but there are measures that should be introduced immediately to give children and young people the opportunities they deserve. Securing child-related benefits - similar to the pensions triple lock - scrapping the two-child limit and benefits cap should be introduced now."

Mental health

Dr Sarah Hughes, the chief executive of Mind, said it had “not delivered the changes needed to help create a mentally healthier nation”. Although the budget outlined funding for mental health crisis centres, the charity had been pushing for more help to stop people reaching crisis point, pointing out that mental health accounts for 20% of all ill health but only gets 10% of NHS spend. The sector is also concerned about cuts to sickness benefit since rising costs have risen partly by worsening ill mental health. Details of potential changes to the benefits are yet to be set out.

Renters

The Joseph Rowntree Foundation said private renters would “feel let down by the choice to keep local housing allowance frozen, and that means that it will become further out of step with local rent levels, which have soared in recent years”.

The Women’s Budget Group thinktank said: “Reintroducing the freeze on local housing allowance is deeply disappointing for the hundreds of thousands of families struggling in temporary housing or facing eviction. The cost of private renting has been increasing, eating up more and more of women’s incomes – with the gender housing affordability gap widening in the last year. The average rent for a one-bedroom property in England is now taking up 47% of a woman’s median earnings, up from 36% last year, compared to 34% and 26% for men respectively.

Farmers

On Wednesday Rachel Reeves announced that, from April 2026, the first £1m of the value of agricultural properties will be exempt from inheritance tax (IHT), but above that threshold the combined relief available from APR and business property relief (BPR) will drop to 50% of the standard 40% rate of IHT. This means that inheritance tax of 20% will effectively apply on the full value of farms and rural estates above £1m.